your largest financial mistake to date?

[Totoro]

Bought $5k worth of bitcoin when they were $9 each a few years back. Sold at $20. It's now worth >$600. >$350k missed.

Not going full in stocks early 2009. Also several $100k missed. Good thing is, these are errors of omission. Those hurt less.

Biggest error of commission is taking bonus in the form of stock options that were locked up until end of 2008. The options were on a fund mostly comprised of financial institutions .. was only $20k or so, but it stinged quite a bit relatively speaking.

And special mention for having a dysfunctional family. Dad has a rather large stash but has become alienated. Worth a few mil.

 

[erkevin]

Fortunately, nothing too catastrophic. Purchased a small SUV and one year later convinced myself we need newer and bigger. Added 1 year to payments and $175 to each monthly payment. About a $15k mistake.
I have punished myself by still owning it and am going to drive it until it dies.

 

[HadEnuff]

I made lots of money during the run-up in the 80s and 90s. The same strategy that made me feel like a genius on the way up, made me feel like an idiot on the way down. But my biggest mistakes which cost me the most money during the late 90's were:
1. Not being diversified enough
2. Falling victim to the oldest mistake in the book, i.e. listening at social gatherings to how much money others were making in the tech bubble, and jumping in AFTER the run-up, just in time for the collapse. and
3. Thinking each new bottom, on the way down, was a "buying opportunity".

Lessons learned: Diversify, Index, and don't listen to what others are bragging about. Fortunately for me, those mistakes occurred early enough in my life to give me time to recover, and fund my retirement.

 

[John Galt III]

Married wrong girl. Or, as someone put it "I chose poorly". Net loss $120K. Best financial moves (for me, not everyone) : keeping 80 percent of my $ in stable value funds, and not getting married again, unless with prenup.

 

[DrRoy]

Bought some bonds from an S&L in the 80's, and then it went broke. Went with zero coupon since it oaid more. Lost $10K plus interest.

 

[Marita40]

Had I been wiser I would have moved in 1988 to a house in a good neighborhood, the neighborhood I wanted to live in. However, houses there were averaging $80,000 (gasp!) and I could not afford that. So I ended up literally "across the tracks" in a neighborhood that was stable at the time but started to slowly erode. I moved several times after that (long story) until I ended up in the ideal neighborhood where I should have moved in 1988! I lost money along the way in realtor's fees, overimproving, etc--not terrible but not great either. Ah, well, here I am now and live and learn!

 

[HadEnuff]

Married wrong girl. Or, as someone put it "I chose poorly". Net loss $120K. Best financial moves (for me, not everyone) : keeping 80 percent of my $ in stable value funds, and not getting married again, unless with prenup.

120K for "choosing poorly" or marrying the wrong girl is, in the long run, fairly cheap. I didn't choose my first marriage as my most expensive mistake, because I don't view it as a mistake, given the years of happiness it brought me, and 2 wonderful children and subsequent grandchildren.
Not to minimize your pain, in any way, both emotional and financial. Congratulations on "living and learning".

 

[Winemaker]

I spent most of my money on wine and women and wasted the rest....

 

[bclover]

Probably getting into debt right after college.

Ironically, I don't look at the money I blew in my young 20's as a waste. I look at my sons and their classmates and I see all the horrible stress they are under and truthfully I am beyond glad I grew up in a time when you could blow some money on a car and it not equal financial disaster. I remember my first new car, lol a green pinto, how proud I was owning my own car.
Sorry, I do feel bad for todays youngin's, seems like the message they get now is if they so much blow 100 bucks on beer at an Eagles game they are doomed.

When my late husbands old company cashed out their pensions we used it for a down payment on our house. probably wasn't the smartest move financially

 

[FIREmenow]

Buying employer company stock on its way down. The WHOLE way down. Month after month, saying "how much worse could it get?" and buying more. Never recovered.

Valuable lesson. Cost me 5-6 more years of w*rk to get to FIRE.

 

[Danmar]

Divorce. Yes know all about it. Quite surprising that I didn't list that as my biggest financial mistake. I guess that means I have put it behind me.

I separated at 42. She got everything except my career. She only got a portion of that. Probably cost me about $5-10million over the last 25 years. Worth it. Still paying but plan to buy her an annuity in a year or two that will finally get her off my back. Actually all in all it worked out very well. For everyone.

 

[Totoro]

Buying employer company stock on its way down. The WHOLE way down. Month after month, saying "how much worse could it get?" and buying more. Never recovered.

I remember a bar discussion with friends. One guy to the other guy: Fortis is down xx% now, how much lower can it get?

Turns out, all the way to zero. 2008 for you. Hindsight 20/20 ..

 

[HadEnuff]

Divorce. Yes know all about it. Quite surprising that I didn't list that as my biggest financial mistake. I guess that means I have put it behind me.

I separated at 42. She got everything except my career. She only got a portion of that. Probably cost me about $5-10million over the last 25 years. Worth it. Still paying but plan to buy her an annuity in a year or two that will finally get her off my back. Actually all in all it worked out very well. For everyone.

Good post. Just because it was expensive, doesn't mean it was a mistake.

 

[brucethebroker]

Fortunately, nothing too catastrophic. Purchased a small SUV and one year later convinced myself we need newer and bigger. Added 1 year to payments and $175 to each monthly payment. About a $15k mistake.
I have punished myself by still owning it and am going to drive it until it dies.

Great attitude...my favorite comment today!

 

[brucethebroker]

Not keeping the first two homes we purchased when we relocated here. We broke even on one, made a little on the second. If we had rented them out, instead of selling, they would be paid off now, worth about $450k and adding about $3500 a month income.

Had not started investing in rentals at that time, and did not understand the potential.

Best move was marrying my wife. Great head for numbers, kinda frugal, and is a real budgeting wiz! (Good looking, too!)

 

[Mo Money]

Investing in private placements, and buying Enron at its peak. No huge losses, and they taught me valuable lessons.

I do regret not buying Google at IPO, and Facebook when it tanked shortly after IPO, but by that time I was (and am) fanatically an index investor. I wanted to avoid the risk of single stocks. Enron taught me that, and it's probably for the better in the long run; for every Google and Facebook I might have bought, there would probably be ten total dogs I'd have been tempted to buy....

 

[kcowan]

Divorce. Yes know all about it. Quite surprising that I didn't list that as my biggest financial mistake. I guess that means I have put it behind me.

Married wrong girl. Or, as someone put it "I chose poorly". Net loss $120K.

DW convinced me to turn down on offer on our 5000 sq.ft. estate for $1,050,000 as I had wanted move 10 miles away and buy on a lake, putting $500k in our pocket.
7 years later we unloaded the house for $530k.

Best move was marrying my wife. Great head for numbers, kinda frugal, and is a real budgeting wiz! (Good looking, too!)

Yes I also excluded my first marriage. Total so far $907,000 and counting. But my current wife is a charmer and has her own money so I consider the money well-spent.

 

[dallas27]

This is the best thread in a long while.

 

[BeachOrCity]

One was "Investing" in an oil drilling parnership in mid 2014 right before prices collapsed.

Another was buying a vacation rental property in late 2003 that did not cash flow betting on appreciation rather than the core economics of the deal.

Threads like this are great as while we learn the most from our own mistakes, sometimes seeing the mistakes of others helps us avoid the same.

My own father gave me some advice when i graduated from college many years ago: "there will always be plenty of people who want to take your money"

 

[Danmar]

Good post. Just because it was expensive, doesn't mean it was a mistake.

Actually the divorce was one of the best things I have done. Very difficult though. 15 years of bitter litigation. I could say the original marriage was a big mistake, but not really as I got a great daughter out of the deal.

 

[Markola]

Selling at the almost bottom in 2009 . Luckily it was only $20,000.

+1. We were 100% Total Stock Index for years but, when it tanked, I discovered the value of diversification into 80/20. I blinked.

 

[socca]

thread statistics

Number of times that various areas in which mistakes were made were mentioned, ordered from most to least:
• common stock ownership: 13
• personal real estate: 11
• personal spending: 7
• marriage: 6
• employee stock options: 5
• employee stock ownership: 4
• business interest: 3
• investment real estate: 3
• partnership interest: 2
• bond mutual fund: 2
• choice of career: 2
• professional financial adviser: 2
• children: 1
• day trading: 1
• credit card debt: 1
• gambling - casino: 1
• disinheritance: 1
• individual bonds: 1

Most of the people posting on this thread seem to have made peace with their past mistakes, which I suppose is one of the keys to happiness.

 

[Totoro]

There is a nice poll hidden in there. Thanks for the summary.

 

[SpinDr]

I've had a few. A couple investing is stocks in my mid 20's at the recommendation of a father-in-law. Ouch! Single largest cost me $8,500 in an early mortgage loan pre-payment penalty.

In the early 2000s I did a refi at the unreal, lowest interest ever, cannot ever go lower rate of 6%. A few years later, when interest rates dropped to where I could do a 10 year at 3.25%, I bit the bullet and paid the penalty to get out of the loan. A lesson for sure in a number of ways.

 

[krldrummerboy]

Biggest financial mistake was to become emotionally invested in a start up and holding onto stock options at the urging of the crazy CEO. Lost ~ $100k early in my career when I had very little savings. Learned a valuable lesson there......