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Your Most Painful Financial Mistake (never to be repeated)

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  • Your Most Painful Financial Mistake (never to be repeated)

    Ooops.  It happens.  What would you consider your biggest financial blunder...one that you have corrected or at least realize is no bueno and will be rectified in the future?  Or is simply water under the bridge now.

    • WCI touched on mine this week in his post about being an unintentional landlord.  Man, that hurt.  

    • But there are others: private medical school that cost  SEVEN times the state school I was accepted to.  :roll:

    • really bad first contract out of residency that wasn't legit.

    • Not contributing to (knowing about!) IRAs early.


    So yeah, the learning curve has been a bit rough.

     

  • #2
    Not learning enough about finance to avoid my mistakes.

    1. Cashing out my prior 401ks from HS/college and residency to pay for moving/school expenses. Egads. I didnt have a ton from hs college but that was nearly 20 years of time. *slaps self*

    2. Private med school and long residency. Great education, but man.

    3. Bought a house and accidental landlord after residency.

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    • #3
      Zaphod, my Brother! High Five to you for not making my Friday suck so bad.  Just kidding...a little.  *smh

      I appreciate you sharing and not making me feel like a freak.

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      • #4
        Rex,

        Did you break all ties?  Cancel the whole policy?

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        • #5
          My biggest mistake was building a large, waterfront home when I got my first "permanent" job.  It's not that I hadn't done due diligence.  I worked there as a locum for months and listened to the administrators' talk of how well the hospital was doing.  They might even expand and build a surgical center, they said.  The place went bankrupt within 4 years, and I eventually sold the home for a quarter million dollar loss.

          In 2010, when the income limit on the ability to do Roth conversions was lifted, I converted a sizable SEP-IRA to Roth all at once.  The thinking at the time was that the income limit would be imposed again before long.  I paid about $120,000 over 2 years in income taxes on the conversion.  The income limit still hasn't been reinstated and now I've got a sizable Roth IRA, but it was probably not the best move.

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          • #6
            Too many.

             

            1. Accepted at UCLA (in state) but attended NYU for dental school (for more than 2x the cost/loans) because I wanted to "live in NYC" once in my life.

            2. Purchased our first house at the peak of the housing bubble in 07.  About to sell it later this year to barely break even.

            3. Didn't know what an IRA/saving for retirement was until I was in residency.  Yes - I was that ignorant.  Thank goodness I had a co-resident that was well versed in personal finance (he came from a very wealthy family) to teach me the basics.  By then, it was already late in the game as I had 0 in retirement/savings and had a net worth of negative 500k in student loans.

            4. Signed an awful contract for an associate position because I couldn't find another full time position (and it had a 20 mile restrictive covenant).

             

            Hope this makes everyone feel better lol

             

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            • #7
              And a High Five to you too, nyu04.  

              Echo. Echo.

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              • #8
                I also had a bad contract, renegotiated 2x in the first year. Slight tweaks to overall model thereafter. Now its pretty fair and awesome. At least residents can see this site and try not to commit the full breadth of our mistakes in the future. Its our contribution to lifelong learning.

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                • #9
                  All my ex girlfriends were pretty costly.

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                  • #10


                    All my ex girlfriends were pretty costly.
                    Click to expand...


                    But much less so than an ex-wife (I hear).

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                    • #11
                      Been there, done that- on too many of these...

                      -No idea of IRAs or Roths or any of this until half a decade out of training

                      -Home owner in residency and accidental landlord until now. Going on the market in a week, keeping our fingers crossed!

                      -Sold whole life and annuities by "advisors"

                       

                      Misery loves company    

                       

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                      • #12
                        Switching from doing it myself with Fidelity to an advisor at ML for a few years.  ops: Rather costly mistake but repented and now using Vanguard thanks to WCI and post by Konstantin Litovsky (thanks) last summer.

                        Others? Sure, being sold a variable annuity

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                        • #13
                          I guess that time I accidentally tipped a bellboy $50 thinking it was a $5 doesn't count :-) I was pretty poor then.

                          In case anybody is interested, my biggest financial mistake was thinking certain internet companies were "for real" around about...1999. Listened to CNBC too much and hung out on Yahoo stock message boards. Thought I was hot poop. And convinced my sister, too. I would have been one of those people who called investing a hobby, and not a serious one at that. After the dot-coms handed me my lunch and a big LTCG carryforward, I decided to quit dabbling in stocks and get serious. Thankfully, today my philosophy is 180 degrees opposite and I give the financial media the respect it deserves (that would be none).

                          Confession may be good for the soul, but it really hurts to admit that.
                          Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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                          • #14
                            Thanks for keeping it real, Johanna.  Your humility puts a lump in my throat.

                            I am glad that you have gotten serious with your investing strategy!

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                            • #15
                              1.  Investing through an "angel" investing group into a startup founded by a Harvard PhD who had invented a new incubator for neural tissue.  This person who seemed nerdy weird walked into a staff meeting at the local University and shot up the room killing 3 people.  The company went bankrupt.  Some risks are unknowable.  I learned "angel" investing is not for me.

                              2.  I also thought I was "hot poop" in 1999.  I also compulsively watched CNBC and was trading from the treadmill at the gym.  In retrospect it was just gambling.

                              3.  I also made a detour through Merrill.  I have seen the light and do it myself with Vanguard.

                               

                              I could go on but the point is everyone makes mistakes.  Learn but do not dwell.  If you save the money you are ahead of most of your peers even if you make some mistakes along the way.

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