What is your single most expensive mistake?

Questions on how we spend our money and our time - consumer goods and services, home and vehicle, leisure and recreational activities
WyndowsFone
Posts: 1
Joined: Tue Sep 25, 2018 8:17 pm

Re: What is your single most expensive mistake?

Post by WyndowsFone »

LAW SCHOOL. Looks like this is a common one!

I went to undergrad for Computer Science, and entered the tech industry in January 2000. Exactly two months before the dot-com bubble burst. I spent the first 5 years of my career averaging a layoff every 9-12 months. The only places hiring junior-level warm bodies such as myself were consulting firms, so I bunkered down in that world for several years doing 100% travel to survive the downturn.

I hated EVERYTHING about being a consultant. At that time it also seemed like the entire profession was moving to India, and I had made a tremendous mistake in selecting a major. So around 2006, I took the LSAT and got accepted to a law school with an evening program.

That was probably the most intellectually stimulating period of my life. Although it put a strain on my marriage, and hit the pause button on my career, it was so exciting to have a "second chance" at being a university student again! As far as mid-life crises go (which this basically was), it was probably a better choice than the stereotypical convertible-and-affair-with-a-secretary!

Unfortunately, through interacting with mentors, I realized about 2 years in that this was not an escape from the consulting world. In essence, the typical lawyer is little more than a consultant on steroids. The profession is everything that I hated about consulting, multiplied several times over. It also didn't help that the 2008 financial crises came along while I was halfway through my degree, and wiped out the job market for legal grads. First the dot-com crash as a computer programmer, and then this as an attorney... I think the universe was trying to teach me to buy-and-hold a career path rather than daytrading them!

I finished the degree (and the bar exam) out of stubborness, and to this day I still pay an annual "inactive dues" to my state bar. Because although I'm 99.999% sure that I'll never practice law, I would have to re-take the bar exam if I let my license lapse... and I'm NEVER studying for that thing again!

However, I stayed in the tech field. And as things turned around in the tail end of the past decade, I came to realize what a silly mistake I had made in not simply staying the course. I left the consultant world and just went "in house" as a regular employee at companies. In 2010, I was doing better than probably 2/3'rds of my law school classmates. Today, I'm probably ahead of 90% of them... and that doesn't even count the roughly half that have left the field. Not just better in terms of salary, but in terms of working a healthy 40 hour week in jeans and sneakers and being able to spend time with my family each night. While any job can get crazy at times, things ultimately worked out better than I could have hoped for a couple decades ago.

For several years after graduation, I used to tell people how intellectually stimulating the law school experience was, and that I had no regrets about it overall. My views have changed since then, as I started educating myself about retirement planning... and realized that my little adventure probably pushed out my retirement date by 5 years or more. It wasn't THAT rewarding!
IngognitoUSA
Posts: 206
Joined: Sat Mar 11, 2017 6:54 am

Re: What is your single most expensive mistake?

Post by IngognitoUSA »

Would be nice to start a thread on what mistake People are currently making and how people can give sound advice, instead of a new thread each time. For ex. I have money in bank earning 2%, would love to know if I can do better without putting in stock.
Nissanzx1
Posts: 605
Joined: Wed Jul 18, 2018 11:13 pm

Re: What is your single most expensive mistake?

Post by Nissanzx1 »

1) I bought a hot tub on a credit card.

2) had 10 credit cards with balances.

3) had 10 vehicles registered to me with a $45k/yr job.

4) bought a house with a girlfriend and had to borrow mortgage assumption money from parents (whom were not flattered at the situation) after the relationship ended.

5) purchased hundreds of thousands in wrist watches over my life.

Yep I've done dumb things. Lots of dumb things.
User avatar
JamalJones
Posts: 247
Joined: Sat May 28, 2016 12:53 pm
Location: Virgo Super Cluster

Re: What is your single most expensive mistake?

Post by JamalJones »

About 15 years ago, I did a short-term work assignment overseas that lasted four months. It was fairly lucrative by my standards. After taxes I had roughly $25,000 in my savings account upon my return. However, because my actually salary was low, I spent those early years of my career coasting on fumes and essentially living paycheck to paycheck. So I used that extra income to just "live my life". I turned that money into a slush fund for going out with my friends, buying drinks, eating at restaurants, ordering stuff online, tickets to whatever (I also bought an expensive vacuum cleaner, which I did need). It made me not feel like I wasn't always hurting for cash and putting things off until pay day.

I ended up piddling away that 25K over the course of about 18 months.

One of the things I did purchase though was a digital scale that, along with your weight, showed your body fat percentage. I got the biggest kick out of that! Was weighing myself everyday to see that percentage tick up or down. Totally fascinating.

I still have that scale and use it regularly.
TSP + Vanguard + Fidelity CMA: 80% equities / 20% bonds | "I don't shine shoes, I don’t tape ankles, I don't cut checks - straight cash homie!!" --R. Moss | Winner 2021 Hedge Fund Contest
audioaxes
Posts: 212
Joined: Tue Feb 13, 2018 6:16 pm

Re: What is your single most expensive mistake?

Post by audioaxes »

Not the most expensive mistake but as a fresh college kid I had a flat with no spare for my 300zx. Towed to nearest tire shop who I allowed them to upsell me on new tires for all 4. Now as a pretty frugal guy who exhuastively checks that im getting a good deal I kick myself for just blindly buying those tires. I think all the tires I've bought combined since then over 15 years ago probably is less than the amount I paid for those 4.
rixer
Posts: 758
Joined: Tue Sep 11, 2012 4:18 pm

Re: What is your single most expensive mistake?

Post by rixer »

Investing too conservatively when I was working.
RollTide31457
Posts: 259
Joined: Tue Nov 28, 2017 7:06 pm

Re: What is your single most expensive mistake?

Post by RollTide31457 »

Subaru Forester. Lots of issues - nonstop check engine lights, Bluetooth freezes, seats falling apart, etc. Maintenance costs were horrendous. Went back to a F150 as soon as possible.
JW-Retired
Posts: 7189
Joined: Sun Dec 16, 2007 11:25 am

Re: What is your single most expensive mistake?

Post by JW-Retired »

Classic investing mistake! In 1996 I just knew the stock market couldn't keep rising much longer, so I made a big reduction down to about 50% equities in my 401k. Then I got to watch the roaring bull market re-balanced me back to my usual 70-80% stocks. :oops: I was three years too soon!

Don't know what that mistake cost me in $, but I have to admit it was probably worth it because I learned it's lesson. Never ever again tried to guess what the market would do. So I'm sure I've come out ahead in the long run. :D
JW
Retired at Last
foamypirate
Posts: 142
Joined: Sun Jul 09, 2017 9:36 pm

Re: What is your single most expensive mistake?

Post by foamypirate »

Turning off my 401K contributions completely (not even getting the 5% match) when in my early 20s to pay down debt... Thanks Dave Ramsey! :annoyed :oops:

Definitely still annoyed over that one, but making up ground quickly!
User avatar
augryphon
Posts: 304
Joined: Wed Mar 02, 2016 10:35 am

Re: What is your single most expensive mistake?

Post by augryphon »

My wife and I married right out of college and we were woefully unprepared to handle financial matters, even though we made very good money. That gap cost us in lost savings opportunities, and allowed us to make poor mortgage, car purchasing, insurance and other financial decisions.

In our 20s we figured it out, but it was painful, particularly the burden it put on our relationship for a couple of years. I wish I could go back and be a better man through that struggle, but I value the struggle because we wouldn't be where we are without it.

The good news is, by the time we were 27-28 we had our issues under control and have done very well since, and our relationship survived and thrived. Truly a blessing!

About 5 years later, I heard about this Dave Ramsey guy on the radio, but too late to help us other than reassure us we were headed in the right direction. Where were you when I needed you Dave! And why didn't I think of starting a radio show?
xenochrony
Posts: 116
Joined: Mon Mar 26, 2018 11:24 pm
Location: California

Re: What is your single most expensive mistake?

Post by xenochrony »

PhD..
alfaspider
Posts: 4816
Joined: Wed Sep 09, 2015 4:44 pm

Re: What is your single most expensive mistake?

Post by alfaspider »

WyndowsFone wrote: Tue Sep 25, 2018 9:04 pm LAW SCHOOL. Looks like this is a common one!
Law school can go either way. For me, law school was probably the best financial decision I ever made. I've also found a niche I enjoy.
User avatar
JamalJones
Posts: 247
Joined: Sat May 28, 2016 12:53 pm
Location: Virgo Super Cluster

Re: What is your single most expensive mistake?

Post by JamalJones »

xenochrony wrote: Thu Sep 27, 2018 10:45 amPhD..
Can you elaborate? Did it have to do with the lost years of low pay and not being able to save anything for a decade or so?

Just wondering because I have a few PhD friends and they regularly complained about the peasant grad school wages and that they weren't saving anything when they were in school.

It seems like they didn't start earning a decent salary until they were around 31 (most of them did a post doc).

And I think back to when I was 31 - I had around 6 figures saved up in retirement accounts, etc. But they started at 31 with what I assumed was $0 or close to it. Even though they all began with fairly good salaries, they were in the hole savings wise.

It would be different if they had started out after their PhDs making $300K a year, but they all were around $85K-$120K.
TSP + Vanguard + Fidelity CMA: 80% equities / 20% bonds | "I don't shine shoes, I don’t tape ankles, I don't cut checks - straight cash homie!!" --R. Moss | Winner 2021 Hedge Fund Contest
michaeljc70
Posts: 10843
Joined: Thu Oct 15, 2015 3:53 pm

Re: What is your single most expensive mistake?

Post by michaeljc70 »

The degree responses are interesting. I always thought I'd get an advanced degree. Most of my friends had advanced degrees. I made very good money though with my bachelors degree (not even in my field) (well within a couple years) right out of college and concluded an advanced degree would have very minimal impact on my income.

I'm sure if you are a partner in big law, it paid off. Same for MBA from top school. Most people I know with law degrees don't practice law.
McCharley
Posts: 422
Joined: Tue Apr 12, 2011 5:45 pm

Re: What is your single most expensive mistake?

Post by McCharley »

Well, I sold $25,000 in AMZN stock in 2004 to buy a boat. That would have been a 50 bagger. :greedy

Well over a million $$$ today. That's OK: I'm glad I had a boat. Although I was sure glad when I sold it! :sharebeer
Brent S
Posts: 8
Joined: Thu Nov 03, 2011 11:55 am

Re: What is your single most expensive mistake?

Post by Brent S »

Bought a semi-classic car about a decade ago for $19k, sold after a few years for $24k, now worth $50k.

Bought a house about a decade ago that has depreciated and been a money pit.

I thought it was supposed to be the other way around?
SQRT
Posts: 1792
Joined: Sat Feb 05, 2011 8:44 am

Re: What is your single most expensive mistake?

Post by SQRT »

Marrying my first wife. I figure total cost in the $5-10 million range. Was able to overcome this but it was touch and go for a while. One good result was now have a wonderful daughter. Impossible to put a price on that.
Perkunas
Posts: 294
Joined: Tue May 10, 2016 7:24 pm

Re: What is your single most expensive mistake?

Post by Perkunas »

Most expensive mistake: not learning a good work-ethic until I was age 30+. I wasted a lot of time during high school and throughout 4 years at a fancy-pants college, while friends were studying to become engineers and physicians.
YeahBuddy
Posts: 2503
Joined: Tue Oct 31, 2017 12:55 pm

Re: What is your single most expensive mistake?

Post by YeahBuddy »

So one since most expensive mistake? Well this pales in comparison to many others with 5M - 50M mistakes, but ...


---> Not changing careers earlier or choosing different major in college - >$100k mistake


Resulted in
- lost income yearly from age 21 until 31 ( I worked lower income job(s) )
- lost pension earnings
- lost raises, adjustments, I would've been making 20% more today
Light weight baby!
Hulu
Posts: 212
Joined: Wed Oct 22, 2014 7:55 pm

Re: What is your single most expensive mistake?

Post by Hulu »

Thanks for the wonderful question. The million dollar mistakes seem to be (1) delaying saving/investing, (2) choosing the wrong field/education and (3) marrying/procreating with the wrong person. All of these mistakes happen early which illustrates the time value of money.

For me (3) and (2). Forgoing a mid-level MBA and partnering with a better fit would have me projecting 10s of millions more when I'm really old. Such is life, still a lot to be thankful for. And can hopefully pass on the knowledge :)
Sachay
Posts: 78
Joined: Mon Apr 04, 2011 12:40 am

Re: What is your single most expensive mistake?

Post by Sachay »

JamalJones wrote: Thu Sep 27, 2018 6:40 pm
xenochrony wrote: Thu Sep 27, 2018 10:45 amPhD..
Can you elaborate? Did it have to do with the lost years of low pay and not being able to save anything for a decade or so?
Certainly the low wages and zero savings in early working years does not help, but for me I feel shoehorned in this role that won't really change salarywise. There is no room to grow- my title may change but the money will not. Tenure is not really an option anymore in my field, so the rug can be pulled out and then I'd be really in trouble. My work is extremely specialized and I'm getting older. I'm happy with my path in a lot of ways, but it was certainly a financial mistake for me- choosing law (back in the day...) or medical school or even accepting jobs who were after my math or programming skills would have put me in a far better position financially with room to grow far beyond where I am at now.
Last edited by Sachay on Fri Sep 28, 2018 12:45 pm, edited 2 times in total.
cdu7
Posts: 366
Joined: Thu Feb 02, 2017 1:34 pm

Re: What is your single most expensive mistake?

Post by cdu7 »

$4900 for a custom WHITE sectional from a high end company.....................
fujiters
Posts: 548
Joined: Tue Mar 06, 2018 1:17 pm

Re: What is your single most expensive mistake?

Post by fujiters »

Buying a house in 2007. Peak of the local market. It's still worth 40k less than we paid for it despite spending another 20k on renovations.
“The purpose of the margin of safety is to render the forecast unnecessary.” -Benjamin Graham
xenochrony
Posts: 116
Joined: Mon Mar 26, 2018 11:24 pm
Location: California

Re: What is your single most expensive mistake?

Post by xenochrony »

JamalJones wrote: Thu Sep 27, 2018 6:40 pm
xenochrony wrote: Thu Sep 27, 2018 10:45 amPhD..
Can you elaborate? Did it have to do with the lost years of low pay and not being able to save anything for a decade or so? Absolutely. A decade of lost earnings/savings is a tremendous handicap.

Just wondering because I have a few PhD friends and they regularly complained about the peasant grad school wages and that they weren't saving anything when they were in school. Yes, I was unable to save anything in school and was in grad school for a VERY long time. what exacerbated the problem is that I also took out some student loans to help pay for food and housing as living on $11,000 per year in a large metro area was tough.

It seems like they didn't start earning a decent salary until they were around 31 (most of them did a post doc). Yes, I also did a post-doc and didnt start saving until after 31 years old.

And I think back to when I was 31 - I had around 6 figures saved up in retirement accounts, etc. But they started at 31 with what I assumed was $0 or close to it. Even though they all began with fairly good salaries, they were in the hole savings wise.

It would be different if they had started out after their PhDs making $300K a year, but they all were around $85K-$120K. Yes, I was in this same situation as well.
I would also like to add an additional important point that, while it may not be true for government or University workers, is most certainly true in private industry. The idea that with a PhD, I would have more earning potential than without the PhD, or that I would have higher level powers, responsibilities, or control within an organization. While this may be true when one compares the AVERAGE PhD vs the MS/BS worker in govt or Uni, and even true in industry for the AVERAGE PhD vs AVERAGE MS/BS worker, what is incontrovertibly clear, is that exceptional bright industrious, high EQ BS/MS workers can attain similar, and even, higher wages/responsibilities/control within industry than PhD employees. The "glass ceiling" does not seem to exist for those exceptional BS/MS folks. Some of them are top managers/directors that have PhDs reporting to them, the latter of which, make far less. This may not be the typical scenario, but i consider myself bright and industrious and could skipped the PhD, entered industry with a BS or MS and been far ahead in net worth as to where I am today. This handicap has had substantial impact on my life as well as that of my family.
H-Town
Posts: 5905
Joined: Sun Feb 26, 2017 1:08 pm

Re: What is your single most expensive mistake?

Post by H-Town »

fujiters wrote: Fri Sep 28, 2018 1:49 pm Buying a house in 2007. Peak of the local market. It's still worth 40k less than we paid for it despite spending another 20k on renovations.
Ouch.
Time is the ultimate currency.
User avatar
wabbajack
Posts: 282
Joined: Sun Mar 25, 2018 8:05 pm
Location: Indianapolis

Re: What is your single most expensive mistake?

Post by wabbajack »

H-Town wrote: Fri Sep 28, 2018 3:11 pm
fujiters wrote: Fri Sep 28, 2018 1:49 pm Buying a house in 2007. Peak of the local market. It's still worth 40k less than we paid for it despite spending another 20k on renovations.
Ouch.
A common misconception is that spending $ on renovations somehow increases the value of a house beyond the $ spent.
Don't take my word for it. Look at the data for yourself: http://www.remodeling.hw.net/cost-vs-value/2018/
dknightd
Posts: 3727
Joined: Wed Mar 07, 2018 10:57 am

Re: What is your single most expensive mistake?

Post by dknightd »

I sold some MicroSoft stock in 1987 (+/- a year of so)
Retired 2019. So far, so good. I want to wake up every morning. But I want to die in my sleep. Just another conundrum. I think the solution might be afternoon naps ;)
gvsucavie03
Posts: 1460
Joined: Sat Feb 16, 2013 7:30 am

Re: What is your single most expensive mistake?

Post by gvsucavie03 »

Dropped $700 on a grad school deposit and went to a different school. Broke a rental agreement and lost a $650 security deposit. Wife paid over $1,500 for a class she doesn't plan to use for a career. Several student loans were lifestyle and other expenses and not school.

Fairly low-key, but most of this was when I made around $50,000 or less.
Moneta
Posts: 51
Joined: Fri Jun 22, 2018 12:08 pm

Re: What is your single most expensive mistake?

Post by Moneta »

Mistake #1 of many...

After college, I went to China to teach English. I was out of the country and totally out of contact -- this was before email, and international phone calls were expensive. I forwarded all my mail to my boyfriend's place and left.

While I was gone, my forgetful roommate finally cashed one of my rent checks from several months before. Since I never balanced my checkbook, I didn't know it was outstanding. That dropped my minimum below the $1,000 threshold that I needed (I had one of those checking accounts where you have to keep at least $1K in it and then you would get a tiny amount of interest).

That would have been OK, except somehow my forwarded mail wasn't getting forwarded, so my boyfriend never saw the warnings from the bank. When I got home from China, my account was totally zeroed out.

I went to the bank with the first paycheck from my new temp job to reopen my account. They looked at my records and told me that I had been reported to "ChexSystems" as a deadbeat, so now I couldn't get any bank account in the USA for the next 7 years! I tearfully asked how I was supposed to live without any bank accounts at all?!?! They replied that I would just have to get money orders and live on cash. For 7 years?? Are you freaking kidding me??

I ended up having to plead with the district manager to reinstate my account. After that, ChexSystems still thought I was a deadbeat. A month or two later I couldn't check out at Target because my card was declined. I will never forget the feeling of shame as I abandoned my shopping cart in front of at least 30 other people, and walked out, cheeks burning. It was awful and I have so much more sympathy now for people who are in a money crunch.

Mistake 2)

After temping for a bit, I decided to move to Seattle for graduate school. If I'd lived in-state for a year, I could have slashed the cost by 2/3. But at the time, it didn't seem like an option to just move away from my family "for no good reason" -- I thought I needed something official, like going to grad school, to show them that it was OK. So, it never occurred to me that I could live in the state for a year and get cheaper tuition. I paid the out-of-state rate, taking out a $15,000 loan to fund the first year, in a degree that had no real job prospects (but that's a different story!).

Mistake 3)

My second year of graduate school, I was at last paying in-state tuition (yay!). And things were looking up -- I was awarded a grant! I remember it was over $3,000, which was a HUGE amount of money to me at that time of my life. The award letter said I would need to write a letter to officially accept the grant, so I immediately wrote and signed the letter, and filed it with my department chair.

And then... nothing ever happened. My tuition never went down by $3K, and I never got any $3K. I felt too embarrassed and proud to ask anyone about it and I didn't even know whom to ask. Somehow it seemed "shabby" or "beneath me" to go scrounging around for something as low as money. (A lot of weird built-in assumptions in that thought, right??) I guess I thought I shouldn't ever worry about money? Like I should be "above" the need for money? (Spoiler: I was not above the need for money! I opened a bank account just so I could get their reward of 10 packages of free ramen noodles. I ate at grad school buffets every chance I could get.)

I never did get that $3K, and I never did find out what went wrong there.

Mistake the Fourth...

Going to work for a crazypants small business owner who consistently underpaid the workhorses of the company (I started at $26K). He was also easily swayed by charismatic salesmen, wasted the company's resources on technology that looked slick but didn't meet our needs, and refused to match our 401(k) contributions because it would be a waste of his money. I stayed there 16 years (!), and didn't contribute to a 401(k) at all during that time because there was no company match. D'oh!

Coda: I never did use that graduate degree and I am still paying it off. Almost done, though!
User avatar
Rocco Sampler
Posts: 54
Joined: Wed Aug 23, 2017 6:59 pm

Re: What is your single most expensive mistake?

Post by Rocco Sampler »

I spent a lot on booze and women. The rest I just wasted. 8-)
datadatum
Posts: 28
Joined: Sat Sep 29, 2018 7:16 pm

Re: What is your single most expensive mistake?

Post by datadatum »

Have to say I this thread is pure schadenfreude... so enjoyable for all the wrong reasons! I see the following themes (not including opportunity costs and not being able to time the markets):
1. Divorce
2. Loaning money to friends/family
3. Not investing early in career
4. Expensive toys


Mine are not particularly entertaining...

1) Rented an expensive apartment and bought a car after getting my first job. I thought I was slicker than a cowboy with a new hat. One year later, I was in debt. Took two years to climb out of that hole.

2) Twice I picked the wrong date for buying an online airline ticket. Once for my wife ("Honey - my return ticket is no good?" LOL!!!), and once for myself + son, ending up stranded in Dublin and having to spend $$$ for same day tickets to get to London.

3) Measure twice, cut once. I buy products that don't fit, break products that should fit, and break other things while fitting products. I've been doing my own car maintenance for 20+ years, and have probably broken even on expenses due to a few costly errors.
brajalle
Posts: 363
Joined: Tue Jul 13, 2010 12:03 pm

Re: What is your single most expensive mistake?

Post by brajalle »

Miscalculating an income-based down payment assistance grant program by about $200 in income, grant was worth about $10k.

I'd say eating outside the house is probably far worse though in terms of $$ and health.
ClemsonBogle
Posts: 60
Joined: Fri Apr 07, 2017 9:11 am

Re: What is your single most expensive mistake?

Post by ClemsonBogle »

I didn't see anyone else say it but riding a losing stock down is mine.

I acquired a lot of company stock while employed with an average cost basis of around $18 dollars. Saw this over the years increase to more than $60. Left the company and then held on to the company stock on the way down to 45, then 30, then 20. I think this probably cost me more than 50K.

Lesson learned, when you are done working at a company probably should sell the stock and move it to a simple 3 fund. Although to be fair i am not doing that with my current company right now so perhaps i am still an idiot.
Finridge
Posts: 1096
Joined: Mon May 16, 2011 7:27 pm

Re: What is your single most expensive mistake?

Post by Finridge »

Keeping "dry powder" to invest into index funds on market dips. The investments I made doing this did well, but I would have done even better if I'd just invested the funds immediately as they became available. I didn't think of what I was doing as market timing, but that is what I was doing, and it cost me.
TimeMan
Posts: 42
Joined: Sun Feb 21, 2016 11:44 pm

Re: What is your single most expensive mistake?

Post by TimeMan »

Finridge wrote: Mon Oct 01, 2018 7:01 pm Keeping "dry powder" to invest into index funds on market dips. The investments I made doing this did well, but I would have done even better if I'd just invested the funds immediately as they became available. I didn't think of what I was doing as market timing, but that is what I was doing, and it cost me.
This is my biggest current realization and frustration over the last 4 years since a winfall.

I definitely made some bad decisions on toys and whatnot, easily $200k, but I have a great salary and the vast majority of my winfall, almost enough now in NW to cover the initial tax hit I received at the time, so not bad. Could be better though.

However, I put a large sum into Vanguard at 70/30, including international bonds and stocks. While it has done well and I'm now at about 82/18, I also kept a year's gross salary in Ally in case I wanted to invest in myself or I lost my job. I didn't take into account that's what the bonds were for. Had I put all my vanguard into stock at the time, I would have been 75/25 across both cash and stock, and skipping international, I would have made a lot more.

On top of that, Ally is now at about par with my total return from those bonds.

Now after 2 years of flat returns and 2 years of big gains, I'm afraid to correct by at least moving my bonds into stock as the market is so high.

Of course I could have put it all in stocks and had a big drop and would have been kicking myself too, so hindsight and all...
User avatar
unclescrooge
Posts: 6265
Joined: Thu Jun 07, 2012 7:00 pm

Re: What is your single most expensive mistake?

Post by unclescrooge »

Not majoring in architecture, which was my first and only choice. :oops:

And then instead of going into medicine, I went into engineering which I hated... And hated even worse during grad school. :oops: :oops:

And then turning down a full ride to business school at UCSD, and a half ride to USC :oops: :oops: :oops:
User avatar
sunny_socal
Posts: 2732
Joined: Tue Mar 24, 2015 4:22 pm

Re: What is your single most expensive mistake?

Post by sunny_socal »

I may be in the middle of a Big Mistake right now:
- Moved from CA to TX, kept our CA home as a rental
- Pulled 120k equity from the CA home as a HELOC, used to buy our TX home and do improvements on it (fence, yard, patio)

If things go well:
- Renters will be paying off the CA home at the rate of 20k/year
- CA home will appreciate about 30-50k/year (as it has over the last 5 years)
- We will 'break even' on the HELOC withdrawal in a few years!

If things go sideways: (rates rise a lot, home values crash, or both...)
- Renters will still be paying off the CA home at 20k/year
- Home won't appreciate
- Will 'break even' in about 6 years

I would like to refi the HELOC into a fixed rate, but that's proving difficult since I can't find a lender that will do the mortgage on an investment property :|


Part of me says I should have just sold the CA home in the first place. Another part says it will be worth keeping it since the CA housing market has much more potential for upside than other parts of the country due to excellent weather all year round.
pejp
Posts: 159
Joined: Thu Jan 04, 2018 3:12 pm

Re: What is your single most expensive mistake?

Post by pejp »

I have two:-

1) I collect watches and have done for years. Not to be boastful, but I would consider myself highly knowledgeable and for a time was very actively involved in the watch market. A few years ago, an opportunity came up to buy a Rolex 6265 'Big Red' for around $10k lower than market value, so I took it. I told myself that the Daytona market would continue to go up, and I should just hold on to it, even though it did throw my collection off balance somewhat, and was more money than I would normally feel comfortable holding in one watch. Despite all my instincts telling me that this was one to keep, I folded when someone offered me full market value at the time, and took the quick $10k profit. If I'd held the watch to today, that would be more like a $60k profit.

2) I moved to the US in 2007, and knew I'd be moving home in a couple of years, so didn't see the point in starting a 401k. You guessed it...I'm still here, and I didn't start a 401k until 2015, missing a large chunk of one of the longest bull markets in history, at a time where I could have easily maxed out my contributions and benefited from a very high match. I ran some simulations recently, and I have about 1/10th of what I could have had in my retirement savings right now.
michaeljc70
Posts: 10843
Joined: Thu Oct 15, 2015 3:53 pm

Re: What is your single most expensive mistake?

Post by michaeljc70 »

sunny_socal wrote: Thu Oct 04, 2018 3:22 pm I may be in the middle of a Big Mistake right now:
- Moved from CA to TX, kept our CA home as a rental
- Pulled 120k equity from the CA home as a HELOC, used to buy our TX home and do improvements on it (fence, yard, patio)

If things go well:
- Renters will be paying off the CA home at the rate of 20k/year
- CA home will appreciate about 30-50k/year (as it has over the last 5 years)
- We will 'break even' on the HELOC withdrawal in a few years!

If things go sideways: (rates rise a lot, home values crash, or both...)
- Renters will still be paying off the CA home at 20k/year
- Home won't appreciate
- Will 'break even' in about 6 years

I would like to refi the HELOC into a fixed rate, but that's proving difficult since I can't find a lender that will do the mortgage on an investment property :|


Part of me says I should have just sold the CA home in the first place. Another part says it will be worth keeping it since the CA housing market has much more potential for upside than other parts of the country due to excellent weather all year round.
Are incomes keeping pace with the price of homes? If not, there has to be a top. CA seems to have more housing busts than the rest of the US (but maybe Florida is up there too). The weather was good during the last several housing busts in CA :shock:

Good luck. It seems it could go either way.
User avatar
sunny_socal
Posts: 2732
Joined: Tue Mar 24, 2015 4:22 pm

Re: What is your single most expensive mistake?

Post by sunny_socal »

michaeljc70 wrote: Thu Oct 04, 2018 4:29 pm
sunny_socal wrote: Thu Oct 04, 2018 3:22 pm I may be in the middle of a Big Mistake right now:
- Moved from CA to TX, kept our CA home as a rental
- Pulled 120k equity from the CA home as a HELOC, used to buy our TX home and do improvements on it (fence, yard, patio)

If things go well:
- Renters will be paying off the CA home at the rate of 20k/year
- CA home will appreciate about 30-50k/year (as it has over the last 5 years)
- We will 'break even' on the HELOC withdrawal in a few years!

If things go sideways: (rates rise a lot, home values crash, or both...)
- Renters will still be paying off the CA home at 20k/year
- Home won't appreciate
- Will 'break even' in about 6 years

I would like to refi the HELOC into a fixed rate, but that's proving difficult since I can't find a lender that will do the mortgage on an investment property :|


Part of me says I should have just sold the CA home in the first place. Another part says it will be worth keeping it since the CA housing market has much more potential for upside than other parts of the country due to excellent weather all year round.
Are incomes keeping pace with the price of homes? If not, there has to be a top. CA seems to have more housing busts than the rest of the US (but maybe Florida is up there too). The weather was good during the last several housing busts in CA :shock:

Good luck. It seems it could go either way.
In SoCal there is still room for growth, incomes and houses 25-50% less than BA
Lucien786
Posts: 64
Joined: Wed Aug 01, 2018 3:16 pm

Re: What is your single most expensive mistake?

Post by Lucien786 »

Let me try to give some comfort to my fellow PhDs . . .

What I feel, is that by doing a PhD I essentially took my retirement early. "Retirement?!" you say. "But I worked my butt off in grad school!" Right, but that's exactly what I would WANT to do in retirement as well -- work my butt off, but for something I really cared about. Mind you, I went into the PhD with that mentality, as opposed to a really means-to-an-end mentality, since I pretty much knew the end wasn't all that realistic/worthwhile.

But I feel like in the end I got ahead, enjoying some of the highest value years of my life by putting them directly in the bank rather than sacrificing them for some unknown future. And because of that time I know exactly what I'm going to do if/when I get financial independence, picking up where I left off. Essentially, I have had some practice with independence/freedom.

But yeah, the financial sacrifices are enormous, much greater than I ever imagined now that I understand the time value of money, etc.
xenochrony wrote: Fri Sep 28, 2018 2:31 pm
JamalJones wrote: Thu Sep 27, 2018 6:40 pm
xenochrony wrote: Thu Sep 27, 2018 10:45 amPhD..
Can you elaborate? Did it have to do with the lost years of low pay and not being able to save anything for a decade or so? Absolutely. A decade of lost earnings/savings is a tremendous handicap.

Just wondering because I have a few PhD friends and they regularly complained about the peasant grad school wages and that they weren't saving anything when they were in school. Yes, I was unable to save anything in school and was in grad school for a VERY long time. what exacerbated the problem is that I also took out some student loans to help pay for food and housing as living on $11,000 per year in a large metro area was tough.

It seems like they didn't start earning a decent salary until they were around 31 (most of them did a post doc). Yes, I also did a post-doc and didnt start saving until after 31 years old.

And I think back to when I was 31 - I had around 6 figures saved up in retirement accounts, etc. But they started at 31 with what I assumed was $0 or close to it. Even though they all began with fairly good salaries, they were in the hole savings wise.

It would be different if they had started out after their PhDs making $300K a year, but they all were around $85K-$120K. Yes, I was in this same situation as well.
I would also like to add an additional important point that, while it may not be true for government or University workers, is most certainly true in private industry. The idea that with a PhD, I would have more earning potential than without the PhD, or that I would have higher level powers, responsibilities, or control within an organization. While this may be true when one compares the AVERAGE PhD vs the MS/BS worker in govt or Uni, and even true in industry for the AVERAGE PhD vs AVERAGE MS/BS worker, what is incontrovertibly clear, is that exceptional bright industrious, high EQ BS/MS workers can attain similar, and even, higher wages/responsibilities/control within industry than PhD employees. The "glass ceiling" does not seem to exist for those exceptional BS/MS folks. Some of them are top managers/directors that have PhDs reporting to them, the latter of which, make far less. This may not be the typical scenario, but i consider myself bright and industrious and could skipped the PhD, entered industry with a BS or MS and been far ahead in net worth as to where I am today. This handicap has had substantial impact on my life as well as that of my family.
dknightd
Posts: 3727
Joined: Wed Mar 07, 2018 10:57 am

Re: What is your single most expensive mistake?

Post by dknightd »

I don't regret getting a PhD. Sure it cost me 6 years of earning and compounding. And really did not increase my salary above my BS engineering degree. But honestly if I could have found a graduate school that had a retirement program, I would have probably stayed in it.
There is more to expense than money
Retired 2019. So far, so good. I want to wake up every morning. But I want to die in my sleep. Just another conundrum. I think the solution might be afternoon naps ;)
Plymouth56
Posts: 40
Joined: Sun Mar 30, 2014 5:44 pm

Re: What is your single most expensive mistake?

Post by Plymouth56 »

It didn't cost me millions, but in terms of aggravation time and money spent, my buying a new GM vehicle was a mistake I won't EVER make again.
rashad3000
Posts: 314
Joined: Fri Feb 24, 2017 10:20 pm

Re: What is your single most expensive mistake?

Post by rashad3000 »

Made a boneheaded mistake and hit someone with a $2000 deductible and no rental car coverage. Will cost me about $2500 total, as well as the inconvenience.
SteadyOne
Posts: 688
Joined: Fri Mar 22, 2019 5:26 pm

Re: What is your single most expensive mistake?

Post by SteadyOne »

Playing with random stocks
“Every de­duc­tion is al­lowed as a mat­ter of leg­isla­tive grace.” US Federal Court
jello_nailer
Posts: 571
Joined: Sun Apr 07, 2019 10:20 pm

Re: What is your single most expensive mistake?

Post by jello_nailer »

Rocco Sampler wrote: Fri Sep 28, 2018 6:15 pm I spent a lot on booze and women, <and cars>. The rest I just wasted. 8-)
Edit for you < and cars> :D
Puyi
Posts: 43
Joined: Thu Nov 17, 2022 10:30 am

Re: What is your single most expensive mistake?

Post by Puyi »

Unlike most of my classmates, I graduated from college fully employed with a nice paying engineering job in the spring of 2009. I dutifully put away 15% of my paycheck in my 401k starting on day 1. But either through laziness/ignorance/uncertainty, I neglected to fund my Roth IRA even though I easily could. I didn't end up putting any money into my Roth until 2014! 5 years of the best accumulation years pissed away.
User avatar
K72
Posts: 440
Joined: Wed Dec 05, 2018 7:04 pm

Re: What is your single most expensive mistake?

Post by K72 »

Keeping my IRA with a megacorp brokerage for 15 years with high advisor fees and poor results.
All we want are the facts...
Herekittykitty
Posts: 930
Joined: Wed Apr 16, 2014 8:11 pm
Location: Flyover Country

Re: What is your single most expensive mistake?

Post by Herekittykitty »

onedayer wrote: Tue Sep 18, 2018 5:07 pm I’m only 23 so there haven’t been that many mistakes (yet), but my biggest mistake so far was going to college. I went to college for 2 years right after high school and quit with no degree and about $11K in student loan debt which I plan to have paid off in the next couple years. Looking back on it, there was no point in going to college as my career does not require a degree. On the other hand, I may not be where I am today if I hadn’t gone to college so it was probably for the best in the long run.
I don't see the education as a loss at all.

Just for fun when you have the time, look into what of those credits a local two year college would take in transfer and what degree you could get from that college. Maybe you could polish off a 2 year degree without a lot of time and expense. A completed 2 year degree seems to me to be worth more than a collection of credits.

The degree I am the most proud of is my 2 year degree. It showed me I could do it. It hangs on my wall and makes me happy to see. You might want to consider posting your situation in a separate thread and see what people say. OTOH if you are happy as you are - the good for you, too!
I don't know anything.
EFF_fan81
Posts: 435
Joined: Sat Jan 07, 2012 10:23 am

Re: What is your single most expensive mistake?

Post by EFF_fan81 »

I have done things that have resulted in me having less money now, but it is difficult to call them mistakes because I was acting with the information I had at the time, and can't tell if things actually would have turned out differently if I went a different path given my knowledge and maturity level at the time the decisions were made.

I *suspect* if I focused on a career in high finance and got an MBA I would be making a lot more now and perhaps enjoy my job more, but plenty of people burn out of that profession (and one of my few friends still in it doesn't like it) so who knows. But, my bosses boss seems to have a more interesting and more profitable job than I do, so there's that.

I took a big paycut for a job for partially ideological reasons and then ended up later undoing that and jumping back to something more like my old career, so I could have just taken a more linear path and had more money. But, I learned a lot, and all that wander are not lost.

I lost my retainer and that was pretty dumb and cost me $700 but that was in my early 20s.

As a data point on the lawyer stuff, while at various times I have been frustrated with my career, right now I am paid well and have a good work life balance, so it is not all horror stories out there. I sit in a comfy chair and read dry but complex papers and provide advice to businesspeople about them. One can do a LOT worse in life so I am grateful for that, but I did go to a tippy top law school and did the biglaw grind first to get here.

At some point I would love to jump off and do something entrepreneurial, but THAT could be a very expensive mistake so I am still accumulating, and waiting, and learning. We shall see what the future unfolds.
Post Reply