Ask the Readers: What's the Worst Money Mistake You've Ever Made?
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Two weeks ago, we asked about the best money move you've ever made. This week, we'd like to jump to the other end of the spectrum.
What's the worst money mistake you've ever made? What did you do to recover — or simply plow on — after the stumble? What lessons did you learn from the experience?
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I let myself get caught up in an estate auction bidding war for an antique Victrola record player. Not that the item wasn't really nice, but it was big and heavy and cost me $450 that I never recouped. I tried listing it on ebay but had no takers for it there, so eventually I freecycled it to some guy who wanted to play his dad's old 75 rpm records to remember his father by...
The worst money mistake was buying a home when prices were sky high.
My worst money mistake was a used vehicle buying incident. I was in the market for a used truck about two years ago. I was well aware of what steps to take while looking for a used vehicle. I knew I wanted to take it to a garage and have them give it a once over, I performed all the functions (4x4), cruise, windows, and etc, I visually inspected the truck including underneath. I took it to a garage, they told me a, b, c, and d will go wrong with the truck in the next 10-20k miles. It will also cost x amount of money. Well I went back to the dealership with these issues negotiated 2k off the price, and was thinking hey this is a steal! I bought the truck, down the line and the price of the truck later in repairs yes... the PROFESSIONAL who I did not heed the advice of was right (a,b,c, and d) went wrong. Currently the (d) aka my brakelines went. It is now sitting in my parking lot of my apartment complex, and I will be taking a large loss. I learned to heed the advice of the professionals, and I am trying to sell it taking a large loss at this point. I will go through the procautionary steps next time, and actually LISTEN to them.
Feeling rushed in the home buying process and buying a house that was too expensive!!
Worse money mistake was getting more than one credit card! Luckily I am paying them off and living within my means.
Bought something just to "buy something" on vacation. Had been so careful to stay within budget, but ended up spending $30 I didn't need to on something I didn't need. I know, $30, not a huge oops, but it was a turning point for me.
I kept spending money up to $1000 on my credit card when I didn't have any money left and had no income during college. Afterwards, I paid off the debt asap after I got a job. From that point, I have not been in credit card debt ever again (I am much more cautious than I was before).
the WORST $$$$$$ error i ever made was to not INSIST hubby spend my five-figure income on home repairs b4 my forced retirement & loss of my health...oh geez, i've kcked myself MUCH more than those acors on the V-8 commercial
Didn't ask to see the credit report of a guy I married. There's a lot more to this story, but that is the lesson learned. If it is that apparent that someone is not financially sound, go with your gut...it they resist this simple request, he/she is not for you.
The worst money mistake I ever made was not using coupons. How did I ever go to the store and not use coupons!?!?!
Not paying off student loans when I add discretionary income.
The worst money mistake I ever made was loaning a couple thousand dollars to my ex. I should've known I'd never see it again!
When I was in my 20's I co-signed on a truck for my boyfriend. Though it was only a $5,000 truck, I ended up paying for it and he kept the truck. He never repaid me. I never co-signed on anything else. I was a fool. If someone needs a co-signer you can bet they are irresponsible with money, hence why they need a co-signor. Now I'm recovered and obviously do not have that boyfriend. I'm glad I learned that lesson in my 20's. Now I'm smarter for it!
It's a three-way tie between:
going to an overpriced private college
racking up credit card debt
buying a house (or, at least, the specific house I bought in the area I bought it in)
Using my entire savings as a downpayment on a car. Eating ramens and rice was no fun the first 6 months before my savings started becoming stable again
the worst mistake was not buying a house when the real estate market was down
My worst money mistake was taking out a loan for laser hair removal when, first, I didn't need it. This is the worst because my car went kapoot a month later and I bought a new car. Now I have two loans out there plus all my student loans on top of that. Oi vey.
After lean college years I landed my dream job. Instead of saving a chunk from each paycheck, I blew though pretty much all of it, thinking $1000 was a massive amount of savings and would cover any emergency. Ha! (As you all chuckle knowingly). Anyhow, life and marriage and kids happened and it's been really tough at times. I used to beat myself up over the dumbness of youth but realized what my mom said it true, "If you can't be an example, be a warning". So our kids know better and hopefully won't go the same way
Renting for so long when I could have bought my own home - when I finally did, I realized the financial and personal satisfaction of having a place to call my own.
In this economy, my English degree.
The worst money mistake I made was lending money to an boyfriend, who eventually became my EX!!!
Paying my rent with my credit card during months when I wasn't getting enough hours at work to cover it. This was, oh, four or five years ago, and it put me in a pretty bad place that I've been steadily digging myself out of.
Worst money mistake => Taking out a home equity loan to pay off credit cards.
We just charged the cards back up again, and our mortgage is now higher than it would have been. (We combined first and second loans a few years later when we refinanced.) If we hadn't taken out the second we would never have been underwater with our home equity during the recession. And perhaps if we hadn't taken it out, we would have had our "come to Jesus" moment a lot sooner about our debt load and financial practices.
What I learned =>
1) Don't necessarily trust the advice we are given by so-called "financial experts" (most of whom were advising what a great idea home equity loans were because they were tax deductible).
2) Just because something is easy to do (i.e., obtaining the equity loan was easy!), doesn't mean it's a good idea.
3) Trust your gut! I didn't like the idea when we were doing but couldn't figure out why I was uncomfortable with it, and couldn't see another way out (at that time!) PLUS all the experts were recommending it.
The worst financial mistake I ever made was financing my living expenses via private student loans which racked up significant interest that was later capitalized. At the height of the loan the interest amounted to 50% of the original loan amount. It wasn't until I started working and paying bills that I realized the true cost of my decision to deal with it later. I know better now and when I am blessed with children, they will learn early.
Bought a condo at the height of the market.
I would say my worse money mistake was buying many useless trinkets and doodads from my Japanese anime obsession days, and charging it all on my only credit card. I racked up almost $5,000 in debt and it took me almost 8 years to pay it off.
Several years ago I placed myself in a financially vulnerable position and was taken to the cleaners by the person I trusted most. Lesson learned. I may seek counsel from others but will never hand over the reins again.
I never finished school because I was strapped for cash. Huge mistake. I wound up okay, but it took many years. I think about how far I could have gone.
using a credit card to get m car fix and not investing in (I think) google when the prices were cheap
Not having a budget and overdrafting all the time because I didn't know how much I should be spending or how much I had in the bank.
The worst money mistake I ever made was wracking up credit card debt when I was in college! It took me years to get out from under that burden of debt! #neveragain #liveandlearn
Oil changes from dealer when I bough my car (to be fair, my mom was co-signer and helped talk me into it). Twice as expensive and twice as often as I need them.
One the plus side, this did make me more distrusting of the dealer. They later wanted to charge me $130 for changing my air filter and cabin air filter- refused and found out later it would have been about $50 for parts, $80 for five minutes of labor I could have done myself. Buyer beware!
My worst money mistake was to use credit cards too often.
worse money mistake is not knowing how much you have in your account before making a big purchase
One of the biggest mistakes I can think of is signing up for some of those department store credit cards when I was 18. Luckily I used them once and paid them right off, but they were so unnecessary and not worth the trouble for whatever percentage they might have taken of my purchase that day. What was I thinking!?
Loaning a sibling a fairly large sum of money for something that, in retrospect, seems pretty frivolous. I made the mistake of thinking that I wouldn't feel weird asking for that money back because it was my sibling, but I was wrong! It's uncomfortable asking anyone for your money back! I never saw my money again.........
Gave credit card money even after a charge off. Dumb dumb
Using credit cards.
Forgetting to add my newborn son to the health insurance policy within the 30 day period. I had a rough delivery followed by pain meds, and completely forgot take care of the paperwork. Big fat $$$ mistake as of course he was a separate individual staying in the hospital for several days. That hurt.
Taking $10,000 out of my ROTH IRA principal to help pay for a down payment on a house bought with my new husband. We intended to pay the money back by increasing my monthy ROTH contributions, but two years later we still haven't started this process. We do still love the house and each other, however, so it could be a lot worse.
getting a credit card in college
My worst money mistake was NOT refinancing my house when I should have. Instead I went along with my (then) husband's plan to buy a lot to build on. Long story short, he lost his business, sold the lot, ended up with an IRS lien on our house, which I eventually had removed, but for many years I paid 11.75% interest on a house that I could not refinance. Divorced now and the house is free from the IRS & refinanced, but I wasted $1000s on that mistake.
My husband's student loan. No degree. But it did get us to where we are now. Wish the loan was paid...too many years later.
my worst mistake I made was getting a credit card when I was 18, I ran it up and made the minimum payment. it ended up ruining my credit which took 7 years to get off. worst mistake ever.
What's the worst money mistake you've ever made? What did you do to recover — or simply plow on — after the stumble? What lessons did you learn from the experience?
My husband and I purchased a timeshare back in 2007, we were both so excited at the time. Until we realized how much money it costs us to enjoy one week a year in the timeshare. Our monthly payment is 586.11 x 12 months equals $7,033.32 a year for 10 years plus $1,600 a year for maintenance fees a year, this doesn't include airfare, food, etc. the WORST money mistake we have EVER made in our 25 years of marriage. We are watching the market to see when it would be a good time to recoup our $$ and to dump this mistake. Lesson learned don't let the salesmen push you into purchasing a piece of the american dream that you can use once a year it's not worth it. Lesson learned.
My biggest financial mistake was getting into the habit of running up my credit cards and then paying them down in big chunks, but then I no longer had the income to pay them off.
Oh boy, where to start? Choosing 10-year level-term life insurance instead of the 20-year level-term policy that our agent rightly recommended, and when it ran out two years ago having to frantically throw together a whole-life package since we can't qualify for preferred rates now, or level-term for that matter, at the ages of 55 and 57. We're paying three times the premium for less coverage now. Refinancing our mortgage many times, folding in credit card balances and a car loan so that the principal went up each time. Paying several hundred dollars to set up an automatically withdrawn two mortgage payments a month vs. once a month, instead of having the sense to just do it on our own. Charging absolutely everything--dinners, new computers--and always carrying a balance and maxing out the cards, so that we're now working with the collections departments and our credit rating has tanked. Stupid, stupid, stupid.
The worst money mistake I've ever made was not learning to cook sooner AND by not forcing my husband to stop eating junk!!! I can't believe how economical and easy it is to cook and this could've convinced my husband to start eat right. Now, he is diabetic on insulin and had to give up his career of being a truck driver. He is now demoted to warehouse work with a huge cut in pay. He hates not having the freedom to be a driver and lost all of those over time hours being on the road. And I don't want to think about all the money we could've saved by not eating out all the time.
Buying a home that will be very difficult to resell. There was a reason this property was on the market for a whole year without a single showing.
I got in a (small) pyramid scheme.
Not getting a college degree. Keep in mind I graduated from high school in 1978 and lived in a very rural area, so not a lot of kids went on to college. I think I would be making a lot more money than I am now if I had a degree.
Opening my first credit card when I was approached by a solicitor on my college campus. It's finally paid off. I am 33 years old. Oops.
In college i took out way too many credit cards. im still paying for it today
getting into a big credit card debt.
My worst money mistakes are probably a number of eBay auctions. Sometimes "winning" isn't all its cracked up to be.
Taking a car loan on something we really did not need!
having to break a lease was my worst money mistake!
Loaning money to immediate family. It devastates your bank account and your relationships.
Trading in my paid off vehicle
My worst money mistake was paying full price, in cash, for a Mercdes Benz SUV and not negotiating a single discount with the dealer!!!
I let a friend borrow too much and never got paid back.
Buying this house at the top of the market. I have a 2500 sq ft albatross...
When I was a young man of 19 and in the Navy My best friend from high school who was a civilian and worked construction got laid off and asked for a loan. I made his 333.00 a month car payments for three months for him. I then went home on leave (vacation) and stayed with him for two weeks. It was 1986 and mario brothers home video game had just been released; I sat down and played a few games with him but could not figure it out. My best friend was hounding me for missing hidden coins and hidden tunnels. I thought I was dumb I could not figure this game out and he was an expert. Later I found out that while I was making his car payment he was sitting at home playing videos games. He never did repay me the loan. I stopped talking to him and twenty years later he finds me on faceboook and asks me to move to Indianana to keep him company. Help a man out when he is in trouble and next time he see's you he will ask for more help even when he can do it himself!
Worst money mistake: purchasing our first house too soon
The worst money mistake I made was loaning money to my brother a few years back. I still haven't been repaid and I've had to forego various different opportunities since that money wasn't available to me. Never again!!
Going to law school for one year, but deciding it is not the career you want. I decided to enter the working world, but now I have loans for a career I am not pursuing.
Having kids...
Realistically they are super expensive and almost always have terrible financial return on investment. With that said, they are far from a terrible investment and worth every penny.
On more normal terms, not investing sooner, both retirement and personal accounts. Buying a house just after the peak of the market and losing about 25%.
My worst money mistake was not starting a retirement fund earlier.
I had a boatload of Apple stock at $9 share and I sold it at $75..
The second worst thing I did is create a spreadsheet showing myself how much money I lost!
Used a debt settlement company to pay off my debt. I signed up four account to be settled by the the debt settlement company. I went from pay a little bit on each account to not paying for six months. The debt settlement company collected my money and delayed payment to my credit cards. It took me less time o settle 3 of my accounts on my own than for the debt settlement company to pay off one account and taking a nice chunk for their commission.
I am no longer in debt except for student loans and my car but my credit score is in the dumps
Not paying off our school loans as quickly as possible when we had the money.
Being required to cash in two retirement IRAs in order to be able to finance a down payment on my first house. Bad move. But one I couldn't avoid.
I often try to counsel young folks to think hard about starting an IRA and sticking with it, but very few of them pay heed. They think they're invincible and will be able to keep working. Not so. The American system is not structured to make full use of all employable people. We are not that enlightened yet.
So save, and save often. Putting away small amounts in an IRA early in your career can pay off big.
My worst money mistake was not starting investing earlier in my life!
We bought our house just before the market went down. Even though we weren't under water, its value is just now getting back up to what we paid for it.
The worst mistake I made was blowing a large portion of the inheritance I received when I turned 18. DO NOT GIVE 18-YEAR-OLDS LARGE INHERITANCES!!!! :/ I was in a particularly vulnerable place at 18, and while I am proud of some of the decisions I made with the money, such as giving some of it away and buying my first car in cash, it kills me to think of how foolishly I spent most of it. I would do things much differently now if I had the chance!
My money mistake was cashing in my 401K everytime I left a job.
When I was young and naive, I visited a health club and succumbed to the sign-up-now hard sell without thinking it through.
Not only did I rarely use the place (I was a single mom), several months later I moved across the river to a different state. Stuck paying for it for an entire year. Grrr.
Blogged about this:
http://donnafreedman.com/2013/06/27/a-get-out-of-town-roundup/
Buying an acre of land sight unseen for $2000. After we bought it, we attempted to see it in person but realized we would need, at the very least, a 4WD vehicle to be able to get to it. Fortunately, the seller refunded our money because he had falsely advertised that the land had water access.
My worst money mistake was using my credit card during college to pay for necessities! Seemed to add up so fast, and never had enough to pay it down! Took forever!
worst financial mistake we made as a couple was spending too much before he retired. We just basically spent like we were rich -out to eat a lot etc. Oh we would have been much better off now.
Rather than thinking of them as Money Mistakes, I choose to think of them as learning experiences.
Choose your mate carefully and treat the relationship like the extremely valuable thing it is.
Learn to cook your own food - the closer to scratch the better. Convenience usually is expensive and often not the healthy choice.
Learn to do your own simple home and auto maintenance, do them on a schedule to avoid expensive repairs in the future.
When making a substantial purchase ALWAYS get multiple quotes and don’t be afraid to ask for a better deal. But remember, the lowest price isn’t always the best deal, quality and service have value.
Mind what you spend on a recurring basis, utilities, entertainment, insurance, food, etc. You get to multiply your monthly saving by 12 times for your annual savings.
When paying your bills, “pay yourself first”. Create and contribute to your emergency fund, savings and retirement accounts regularly just like you pay the power bill.
I withdrew money from my 401k. I paid it back but it cost me.
Buying a car and not paying cash!!!!
My worst money mistake was lending an entire paycheck to a friend. The year was 1975 and I think my weekly take-home pay was around $75.00. After the money was lent I saw her a few times but she became scarce after a while - not reachable by phone; I had no forwarding address for her. I felt so abused, used: silly, really.
It took me years to trust anyone enough to lend them even a small amount of money. I will lend money now or accept payments for a private sale but not without a promissory note and a good address and telephone number for the lender/purchaser.
Having this experience at a young age taught me the valuable, if somewhat cliche lesson to not lend money you can't afford to lend; and not to expect it back (unless you have a written note).
I paid for a new car in cash, then traded it in less than two years later. I lost half the value on the trade and it took me 6 years to pay off the new car.
Buying my house from my in laws on contract. I will never subject my kids to the stress I received from my father in law!
My worst money mistake is a fairly recent one. I had my car inspected at a chain mechanic shop and did not know that in NY State, you didn't have to have the required repairs done at the garage that does the inspection. Had I known that at the time, my local mechanic would have charged half what I paid at the national chain garage. As it was, I depleted my short term savings, which I'm trying to rebuild now.
Starting grad school a week before finding out we were pregnant -- and then waiting to withdraw until AFTER the you-don't-get-your-money-back date. Over $5000 for two classes that I never finished. Ugh.
The worst money mistake I ever made was not setting up a budget. I totally did not know I was going to be jobless this summer and still have bills to pay. Another mistake was getting a credit card. I am not using it right and now I have a little debt to add to that. The third mistake was not shopping around and getting the best price for items.
Putting most of an inheritance into an old house we'd purchased. And then the market dropped out
Not insisting that my spouse use an accountant to do the taxes for a small business. The IRS has ruined us.
Invest in the start-up company I was working for because I felt so motivated by it. Lost 13k.