Financial Mistakes I Have Committed
Posted on August 23, 2007
Everybody has made financial mistakes. Personal finance is a complex and broad subject matter with countless variables and decisions. I found it interesting reading interviews with some of the top personal finance authors and hearing their financial mistakes. Liz Pulliam Weston talks about carrying a credit card balance as well as holding onto underperforming, high expense mutual funds. Suze Orman states in this article that she has the majority of her investments in ”triple-A-rated and insured zero-coupon municipal bonds,” which is much too conservative of an investment strategy for much of her audience. The point is everyone makes mistakes (although you could argue Suze Orman’s investment strategy was not a mistake, rather she was not practicing what she preached). Recognizing those mistakes and learning from them is the key. In an effort to learn from some of my mistakes, here are a few financial blunders I have committed:
- Carrying a credit card balanace. At my previous job I was traveling frequently and purchasing thousands of dollars of airline tickets, hotel rooms, computer hardware, and meals on my personal credit card. I had a points based card so I was earning tons of points. However, there were times I was traveling so much and would not have time to fill out the expense report or log on to WebBillPay to pay the bill and the balance would roll over incurring an interest charge. I would kick myself for not catching it sooner but the mistake had already been done. Now that I hardly ever travel at my current job it is not an issue, and in retrospect I got tons of frequent flyer miles and points that I feel like made up for paying interest a few times. Lesson learned.
- Buying too much car when I was 18. I joined the Marines shortly after my 18th birthday. After completing basic training and being sent out to the California desert for my first year, I knew I needed a car to get off base on the weekends. I flew back to Florida for a week and purchased a car and with my sisters and dad drove it back to California. It was a great trip, but when I got back I was the one making the monthly payments. While they were moderate payments, on a Private’s salary it was tough that first year. Luckily, I had a lot of friends help out with gas as we went out on our weekend trips. I will never overspend on a car again.
- Not selling underperforming stocks and mutual funds. I think this has to be a fairly common financial mistake. I have held onto stocks out of emotion rather than unloading them and moving on. I held a Dividend Reinvestment Plan (DRIP) with Intel for the longest time. The DRIP had high expenses and Intel’s stock was underperforming during the majority of the time. I finally got out of that last year and have been glad to be done with it.
In conclusion, I am sure I have made other mistakes but these are the major ones I could remember. Everyone has mistakes, but learning and rebounding quickly from them are what is key.
Here are a few other confessions from around the blogsphere:
- Wisebread and her fellow bloggers tell all.
- Scary Financial Mistakes at Fearless Money
- My Money Mistakes at Canadian Capitalist
- The Ten Biggest Money Mistakes I’ve Made Since My Financial Meltdown 12
- How we lost $14,500 by stupid mistakes at Cleverdude
- Managing Credit And Debt, My Credit Mistakes and Lessons at The Digerati Life
- Mistakes are Expensive at Money for Military
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2 Responses to “Financial Mistakes I Have Committed”
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Hi, unfortunately, I’m glad I can help you out with a mistake story.
I noticed that we haven’t exchange links. I would be interested in exchanging links. Thanks.
Brandon J
Money for Military
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