Custom Instructions and GPTs can both save you from repeating yourself, but they solve different problems.
Use Custom Instructions for the rules you want in most chats. Your usual tone, your audience, British spelling, how concise you like answers, and a reminder not to invent facts are all good examples. Keep this short and stable. If it changes every week, it probably does not belong there.
Use a custom GPT when you have one repeatable job with its own instructions, examples or reference files. Think of a proposal helper, a content brief checker, or a meeting-notes organiser. It gives that job its own little workspace, so your everyday chats do not become a filing cabinet with no labels.
A simple rule: start with Custom Instructions if you want better answers across the board. Build a GPT when you keep doing the same specific task and want a reusable starting point.
Before creating anything, write down the job in one sentence and test it in a normal chat twice. If the same instructions keep coming back, that is your cue to turn it into a GPT.
Which repeat task would you most like to stop explaining from scratch?