If I Could Turn Back Time - Money Mistakes I’ve Made
Posted on February 20, 2008 |
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Thinking back over my years I can think of a number of different money mistakes I’ve made. Some of them were foolishness. Some were ignorance. If only I knew then what I knew now…well I might not have listened to myself but maybe it would have helped some.
Here are some big ones that come to mind:
- Getting credit cards and not understanding them - Here’s the biggest one. Imagine being on college campus. There’s a little table with forms to fill out for a credit card. Also on the table are those little Koosh balls (remember those?). Who can resist playing with a Koosh ball on a nice Spring day? I got one for free for signing up for a credit card. Well that started a long adventure. Next would come retail credit cards. Then some more credit cards. Next thing I know I’m thousands in debt. It took a long time to free myself of credit card debt.
- Spent bonds and savings to move - The time came to move out on my own. As you may know living in NYC is not cheap. And I needed first and last month’s rent as well as a broker fee. For birthdays and such over the years I received a number of bonds from my grandmother. I pretty much cashed them all out and blew any savings I had in order to move. Though I don’t regret moving out, I could have waited a little longer and saved more first. Those bonds would have matured nicely if I didn’t cash them out!
- Not being serious enough about school - I gotta admit, I used to do pretty well in school without working too hard at it. Unfortunately that set up really bad study habits for me that would catch up and bite me in high school and college. Honestly, I didn’t try hard in high school. I got by, not thinking much of the future. I knew I was supposed to do good to go to college, get a job, etc…but it never clicked in my brain to make the effort (or how important it truly was). College wasn’t much different. I went but without much focus. I’ve been attending classes again with the intention of finishing up my bachelor’s and I’m finding it difficult remembering everything I need that was much easier when I was younger. I do OK at my job now but my career path and earnings could have been totally different had I applied myself earlier.
- Not singing up for my 401(k) earlier - When I started at my employer I had to wait a year before I could sign up for the 401(k) plan. So when the year passed and they sent me my pin number did I sign up? Nooooo. I waited and waited. I told myself I couldn’t afford to contribute and it was for retirement anyway which was so far off. I needed money now! Eventually I signed up for 1 or 2%. Somewhere down the line I realized the benefits of the 401(k) plan and how the company matches a certain percentage so I started to contribute more (I currently contribute up to the company match). If only I understood how important time and compounding were in investing! I wouldn’t be rich now but I’d be a little more secure for my retirement years.
- Spending too much for “stuff” - I used to be a real impulsive shopper. That and credit cards is real dangerous. I have hundreds of CD’s in my music collection. Many of them I love and wouldn’t give back for anything but a lot of them were bought out of boredom and impulsiveness. I’ve had so much “stuff” like that. Clothes I’d buy but didn’t need. Books I’d see on sale but never finished. I would be bored and go window shopping. It didn’t feel right if I didn’t come back at the end of the day with a new purchase. I know better now and try to think out my purchases but I could’ve saved a lot on credit card charges as well as increased my savings if I hadn’t been so impulsive.
- Not opening up a Roth IRA sooner - As I’ve mentioned in previous posts I first opened up a Roth IRA last year. That in itself is great. But I should have opened one up much sooner. It was short-sightedness that kept me from doing it sooner. What if I needed the money? How can I afford it now? Why do I need to save more for retirement now? Well, it’s open now but I’ve missed out on a lot of time and compounding.
I don’t regret my past decisions (well not much). Some things I had to learn the hard way. Besides, what’s done is done. But every now and then I think “what if?” What’s important now is I can see these mistakes for what they are and make sure not to repeat them. Hopefully I can pass my experience on to my children so they can learn from their old man’s errors.
What money mistakes have you made?
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We Will Retire
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- Christina said: We took almost identical steps when we went to one income just over a year ago.
One thing we did, that you didn't mention, is to raise our insurance deductibles on our vehicles. Yes, it's a risk if we're in an accident, but you do tend to drive more cautiously.
You could on What We’re Doing To Adjust To One Income - That One Caveman said: That sounds like the exact same steps we took two years ago as we prepared to go to a single income. I'm so glad we did it and you will be, too! on What We’re Doing To Adjust To One Income
- MeLu said: Do I ever know what you mean, we went to a one family income over a year ago. Our income was cut in half, but our spending did not stop. I've now realized that we are in deep trouble. Lucky I'm old enough to draw social security but that is not enough so I'm on What We’re Doing To Adjust To One Income
- Nicole said: Good for you. It must be a tough change to make but it sounds like you are doing all you can to make it work. on What We’re Doing To Adjust To One Income
- Mercedes said: I saw this earlier but now I can comment now that the kids are in bed. I just wanted to drop by and offer support to both. I was miserable in my job thinking of everything I was missing with my child. And I did miss a lot, now that I have a second on What Is Raising A Child Worth - We’re Going To One Income
- Christina said: We took almost identical steps when we went to one income just over a year ago.
One thing we did, that you didn't mention, is to raise our insurance deductibles on our vehicles. Yes, it's a risk if we're in an accident, but you do tend to drive more cautiously.
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My biggest mistake is buying too much stuff. I’m a packrat but now I am in the process of selling it off.
My biggest mistake was not getting life insurance when I was younger. I would have qualified for much cheaper rates due to a better health status. Even at 40, I now have to pay due to several health issues that have come up in the past 5 years.
@Kim - I have too much stuff syndrome too. I’ve been getting better though. Especially when I think about what everything costs.
@Carin - That’s a good point! It’s something my wife and I need to look into ourselves. Thanks!