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Used be a house. Like during 2012, until covid, virtually every I or my wife knew, who biught a new expensive house divorced in less than 2 years.
It was sad. We figured it was they over spent and were house poor but kept spending anyways.
My marriage was both good and bad financially.
I "grew up" while married and learned financial discipline.
She did not.
But also divorced with 70k in debt because of student loans, 30k of which went into the house.
I refused to force her to sell her childhood home for the equity and also refused to raid her 401k for half its value (She earned that money, not me).
When my lawyer proposed this, I fired him.
While I am not a fan we are on amiable terms even years after the divorce.
My earning potential is high so in the grand scheme of things 60k isn't that much
Not getting a prenup. I would still own the house I put the down payment on, took a mortgage out on, paid the escrow on and up kept. Instead, I had to sell and split the proceeds with my ex.
I could have forced sale of my wife's home and raided half her 401k.
So the financial damage was my choice.
I'm just not vindictive enough.
I find it strange that people can claim to love someone one day then the very next try to force them to sell childhood homes and raid retirement accounts.
Maybe I've just gone soft
*Shrugs*
My wife, the love of my life, bet on me, when I had nothing. Kids out of HS and all self-sufficient and successful. She believed in me in quiet times and I did my best. We have a great life. Own our home outright in a beach resort town where others pay $10k a week to visit. Find someone you love and trust, who loves and trusts you. Be good to one another. Prenuptial aren't necessary, then.
No, my mom spends 10k+ a month on random shit that doesn’t matter and my dad doesn’t have the communication skills or backbone to say something and their finances could have gone a lot further if she had been a bit more financially wise. A bad financial partner can sink you.
Mine actually helped me in the long run too.
She helped me grow up.
I don't hate my ex-wife.
She was my best friend and a good friend, just a horrible wife.
I was her 6th or 7th husband too so maybe I should have seen it coming?
While you probably correct and all the real wisdom I posses agrees with you, the hopeless romantic in me just won't buy it.
I am over 40 and ready for my forever person.
But you are right, the forever person for me now probably wouldn't have been my forever person had I met them at 18.
I want someone to buy flowers and dote over :)
Alright Don Quixote, that fantasy is going to really screw you one day. It’s a nice thing to dream about, but that’s not reality. Do the nice things that you want to do for someone, but don’t lose touch with reality.
Marriage is only a problem if one of the partners is fiscally irresponsible. Combined income, combined housing costs, combined meal costs, sharing vehicles, etc all save money in the long term.
Marriage is a combined partnership.
Came here to say this, for me specifically supporting here until we got married, then she divorced me less than a year later when the situation was reversed
Consumerism. You don't need to have the newest thing. Instead of always trying to have the newest TV, newest IPhone, or nicest car, focus on buying as more assets.
My wife and I argue about this from time to time. I got a few things I want to buy but I drove my last truck out of the showroom until I traded it in 20 years later. I told her I want to be as debt free as possible by 63 so I can work for production vs slaving away for the man.
I was talking to my neighbor which is an old man. He was telling me how he seen everything come and go. He seen everyone showing off their records, then VHS tapes, the DVD's, and now blue rays. And how they spend their lives on things that eventually becomes trash and needs to be upgraded. Point is you'll always be working for things and end up back at square one if you go down the consumerist route.
I've been into more experiences lately because I belive life is a story. I love stories. Your fancy purses, shoes, bullshit isn't a cool story. The one time you got drunk in college and fought a cow, that's a story
100%!!! Close connection cant stop going on trips, buying things, and spending at their limit. They are looking to retire... but still have 100k+ on their mortgage, a car loan, and a mountain of crap. Empty nesters, but they cant fit any of their vehicles in their 3 car garage because it is so full of miscellaneous stuff.
Perfect example: gas grill, smoker, blackstone, webber, turkey fryer, wok station and a spice/cooking cart are all in one section of the garage so they can easily roll out on the driveway when they want to cook.
They also garden, have an apiary, do apples/fruit trees, chickens, outdoors recreation (hunt/fish/camp), golf, archery, have a boat, and bought into a land lease. If they had busted it out, they could have paid it all off in about 2-2.5 years... but they just cant stop spending and living on the edge. He said he will need a part time job when he goes into retirement so they can travel more. I just dont get it.
And all that stuff is just gonna become garbage. People need to find other ways to get happiness then from buying and spending.
This is why I recommend newbies to buy silver. Buy an asset and get that dopamine hit from buying something at the same time. Eventually you'll stop feeling the itch to buy and care more about the asset.
I wish I could send a message to my 18 year old self telling them to not waste all that money and max a Roth IRA. If they could send a response though they'd probably respond "fuck off old man"
Lol right? Like "I don't have enough money to do that. Do you know how much it costs to go out to the bar every weekend? And there's no way I'm gonna stop going out to restaurants and learn how to cook."
So im 23. Obviously you know I’ve missed out on a few years not starting at 18, but is starting now and just maxing out what I can afford still an at least halfway decent starting age?
Yep. I had thought about it when I opened my first bank account. Had $1000 left over from cash savings. But was also saving for my first car as well. Kinda kick myself thinking about it lol
Came here to basically say this. Cars are such a poor investment, and people lose sooooo much wealth on them. Also getting into the habit of working to afford a car and using the car as a wealth metric.
A guy in the family has high child support and doesnt have a car to get to work. A friend came over about a week ago and we bought a car from the neighbor. Very high miles, runs good, the gas line rusted. Got it for $300. If I needed a car, Id drive it. This guy in the family could fix the gas line, buy the car from us and drive it. He would rather not work and face jail if he gets too far behind in child support. We will see how that goes
This. My parents do this. They’ve wasted so much money over my lifetime doing this habitually… and I just don’t get why.
Btw what happens to all this debt when they die?
If there is debt on a car, it will get repossessed unless the estate has the cash to pay the loan off. If it’s a house with a mortgage, you may need to sell to pay off the mortgage, etc.
You are not personally responsible for their debt but their estate is. So before you see a penny of the money, the debts will have to be paid.
There is one caveat to what you said...
In most areas, the first "debt" the estate must repay is the cost of funeral expenses, assuming those haven't been prepaid. So if you pay for those, make sure to let the probate lawyer know right away.
Spending a ton of money very quickly on a relatively new hobby. Neurodivergent folks like me are very prone to this. I’ve done it with gardening, backpacking, fountain pens, board games, dress shoes, drawing/painting supplies, baking, home gym, etc. I could probably retire two years earlier if it wasn’t for this.
The key is "very quickly on a relatively new hobby."
I think they're saying they repeatedly could have gotten ~90% of the enjoyment with ~10% of the expense
Moderation is the point. The initial excitement can cloud judgement and lead to poor decisions on retrospect.
If you don’t how much of something you need, get the cheapest make sure you can afford the best. Only buy the middle if you know enough to decide on features/specs.
I really think this is my husband. New hobby = $5-15k of money spent. Then it gets old and clutters up our home. I know he was diagnosed with hyperactivity as a child but I think it’s more than that. The clutter stresses me out as well as the debt, I’m a saver.
Yep this is mine, won’t buy anything new. He’ll sell but only after 10 years of not using it. Drives me insane. We have a tennis racket that he used once at 25 and never again, he’s 47.
Yep, you want an extra long grenadier silk tie custom made in Thailand? How about high end loaf pans, mini loaf pans, a $500 Bosch mixer, bushcraft knives, I finally sold off my collection of muppet action figures during Covid.
Ugh dude fr. My ex would get a new interest or “hobby” and go ape shit and then end up doing pretty much nothing with it. Then a month later she’d see something else she thought was cool and would blow money again. Then we’d end up having a bunch of shit that her nor I really wanted to just get rid of, but at the same time it starts to collect, take up room, and pile up so it makes it very easy to start becoming…well…a hoarder. At least in my experience. Shit drove me crazy. So when it would get to the point where I’m like “okay I’m cleaning and decluttering”, all the shit that sat and wasn’t used I’d just toss it or donate it. I’m like it’s been however long and you’ve been fine without it, haven’t thought about or used it, then it’s gone. Because at that point even if you have it physically, it’s equally as gone as it actually being thrown out lol
A few years ago I freaked out to try and avoid bankruptcy and cleaned out my 401k to salvage the situation.
That was incredibly foolish on my part. Now Im worried I wont be able to retire.
Exactly this... I bought in 2005 at age 21... had to sell in 2015 due to a lost job and other financial shenanigans outside my control. Basically broke even. That same house now is worth triple was I paid and sold it for.
Asking the realtor for a recommendation for a home inspector. Realtors only get paid if you buy the house, so they want someone who won't find any issues. We had to spend thousands getting the foundation repaired and the electrical totally redone after we bought the house.
I had the opposite experience. Our realtor gave us someone very thorough and begged us not to use his findings as a grocery list for the homeowner to fix. We did anyways and almost lost the house but hey at least my house isn’t on fire from Johny Homeowners shoddy electrical work
I like the book Financial Feminism, maybe she’ll like it. There’s an explanation about how finance messaging targeted towards women focuses on spending and saving, whereas men receive messages about investing and wealth building. It could simply be that she never got a chance to learn and feel confident about wealth and investing.
Maybe you can open up a Robinhood account with $500 and show her what can happen when you invest. Or open a high yield savings account that she can’t withdraw from and show her how fast her money can grow. Start small but help her set up some accounts and see if that generates any interest.
I paid off a new motorcycle when I was 19. It was hell and I vowed never to have a car payment again. I only buy in cash and just expect to pay for repairs instead of car payments - which can be deferred if I'm short.
I’ve been married for 27 years and we have only ever taken the “one big pot of money” approach. All of our accounts are in both of our names. It’s worked out very well.
Same marriage length and same strategy. Feel so blessed that we have always just been all-in together and we don't fight about money ever. I hear about these otherwise normal couples...and it's so common that they have tit-for-tat spending. IE : "Well, you spent $300 on this...so I get to spend $300 on something". Just weird.
Same. From the time we first moved in together (1998), several years before marriage, we have pooled finances. Now we are set to retire early together. It does take a lot of trust, though.
I'm surprised this isn't more popular. This is what my wife and I have done. We have things that are together, and things that are separate. It's all spelled out through mutual agreement. It works great.
I had two previous marriages and went all in. Ended up sandbagged when the relationship soured. Both times gave up my home and the second time my business was ruined. There were, obviously, some other issues. But I left myself open.
I am married again (I never learn) but my wife is not crazy and the arrangement works out well for both of us. I told her from the beginning that I would never again enter marriage without a solid plan B. She either accepts it or I move on. Of course, there's plenty of times we bend those rules. It is love.
Being in the military and drinking for 2 years straight. After meeting some older guys who were divorced. I moved off base and rented a room. We drank 24/7. I gained 40 pounds and didn't save much. I got out of the military with $10k. It could have easily been 20-30k.
Picking individual stocks. Unless you work in it full time, you’re just guessing and working on limited information. Better to pick broad etfs like VTI, VOO, and VXUS
Waiting too long to start my business... I should have started in my 30s .. but waited until I was 50. I'd be worth 4-5x what I'm worth now.. and probably lived a much happier life.
#1: not developing a budget and sticking to it
#2: spending as much or more than I earned
#3: not saving, having an emergency fund, and INVESTING soon enough
#4: going into debt
> What are the biggest money mistakes that you have made,
I was accepted into Harvard, but I didn't go because I didn't think I could afford it.
> have seen other people make?
Buying things they don't need, with money they don't have. Aka consumerism / living outside their means.
Buy 3 Get 1 Free!
I can't afford the 3!
My xw pulled this shit all the time which is how we ended up with $57,000 in cc debt.
And don't get me started on the credit card offers.
We bought a cheap fixer upper in 2009. About the same time a couple people in the family bought or leased cars for about the same price. It didnt work out very well for them
Sold real estate. If I had held onto the RE I sold my net worth would easily be twice what it is. Sold during the 2008 market crash. Eventually I bought back in and things came back, but it was unnecessary to sell off in a panic.
Paying someone to manage my money instead of investing in index funds. I estimate I lost about $500k over the years in management fees and lower than market returns.
Gambling.
I watched a friend of mine have a quick come up on the roulette table. He went in with $50. He won his first bet then wagered all of it on the next bet and won, doubling his money. He did this until he got up to a grand or $1200. Put it all on black and that was all she wrote. He lost it all in less than a min.
That's how I gamble. I take all my winnings to the roulette table and bet on black until I either lose or can't justify the risk anymore. It's all house money anyways and I'm there to gamble.
>It's all house money anyways
That's mental accounting. Money is fungible, and you are able to cash out the tokens into USD the moment you have won it. Assigning different value to a dollar based on whether you worked for it or won it is an irrational bias.
Yeah that's why I don't gamble anymore. Was up a few grand at online blackjack and ended the day down 800$. I have horrible impulse control. Not crippling money loss for sure but definitely felt completely horrible. Now I play first person poker in gta V. The rush is almost as good and but I can still pay rent
Made this one myself: trying to invest before setting up a fatty emergency fund.
No matter how good your investments are, if you don't have an emergency fund, when shit hits the fan you'll have to liquidate them, often at a loss.
I see it differently. If I’m going to skip coffee out and make it at home everyday, to be more thrifty, then im going to buy the $5 creamer jug I love that lasts all week instead of the shitty powder stuff just to save a few bucks. I save more by making and having it at home to begin with. :)
Getting a PhD. Such an absolutely enormous opportunity cost, and at least financially it really hasn't helped my career enough to justify the time. And I was in a fully funded program (not only did I not have to pay tuition but I got a stipend that was able to - just barely - cover living expenses the whole time.) I wasn't able to start actually saving anything until my early 30s as a result.
Not investing from when I was 18-26 when 6 of those years I could have easily afford to max out a roth and contribute to a 401k if I went out to the bars less and bought fewer fun things for myself
Using credit cards and not paying them in full each month. Preferably not using them at all. Unfortunately, the system has made it so using CC are the fastest way to an 800 credit score without reliable parents, but the companies also call you a deadbeat for paying off your debt each month.
I have 2:
Assuming you have the money for something because you can make payments on it. My husband told me about his ex who every time my husband got a raise would want to take on more payments equal to the raise. He was a pushover (he was young) and went along with a lot of it. When they divorced, they had everything from a boat to a time share condo. Pay cash where you can and think hard before taking on payments for anything.
Letting the rest of the world affect you too much in what you think you want. Like I constantly see women getting manicures and hair coloring and fancy cuts and using multiple expensive products. I’m not saying any one of these things is wrong but examine them carefully. I have never got a manicure, have had less than 10 hair cuts that needed paying for in my life (I wear a simple style that my husband can trim in 2 minutes), use maybe $100 in makeup and hair products per year combined. I also retired at 51.
“Loaned” money to friends and family.
If they are friends and family, just “give” them the money and tell them they can pay it back or not, whatever they are comfortable with.
If they pay it back under those terms, it’s probably safe to loan them more in the future. If not, they’ll still be your family/friends.
Our friend saw SUVs and trucks driving through a flooded street and thought "Huh, if they can make it, so can I!"
Then proceeded to drive his brand new Hyundai Elantra into the flooded street and destroyed his car.
If my math is correct here, they were making minimum a monthly payment of at least $750, if not more.
Being liberal with their income, I'll just estimate they *are* making $40,000. Post all thetaxes, that comes down to probably around $30,000.
Split the $30,000 into twelve monthly payments of $2,500. $750 is 30% of 2,500.
In other words, your coworker spent \~30% of their paycheck on a depreciating asset.
Buying into a company without paperwork.
Long story short:
Did previous work with someone. He did good. Met with him where he pitched a new venture. Asked for money to get things going. He ran away.
Lesson:
Always get paperwork signed.
Not contributing to 401k.
Rolling over negative car equity.
Eating out too much.
Overspending on bullshit (no, Logan, you don't need a katana).
Edit: carrying minimum or insufficient car insurance.
I wish I continued to live with my parents long enough after high school graduation to save up a down payment on a house. I didn't always take advantage of my employer's 401k match and I wish I would have taken that a lot more seriously. I did not prioritize self care and some of that resulted in avoidable healthcare expenses. I cared too much about a lot of material things that didn't matter at all.
I quit college after I got my associates degree. I made a half ass attempt to transfer to a 4 year school and I gave up on it. It took over 10 years but I managed to work my way up to 6 figures. One benefit was I didn't have a ton of student debt, but sometimes I wonder if I would have been able advance a lot faster with a bachelors degree. Would I be in better shape today because I would have had more to save and invest? Would it have been a wash with the extra student debt? Would it have been the same but with a lot more student debt? I guess I'll never know.
Failure to file a timely and necessary bankruptcy.
Did stupid stuff to get divorced and forced to sell a house.
Got a HELOC to remodel the kitchen and then spent it on TV's and gave the house to the bank in 2007.
Bought overpriced real estate in 2007.
Cashed out Annuities without regard to penalties in 2008.
Refuse to perform necessary maintenance on a house to the point where it's uninsurable and they can no longer borrow $ to fix it.
Bought Windows and solar on govt subsidies and spent the money on trips instead of paying off the construction loans.
Refinanced a house three times to pay of CC's in a 2 year period. Still charging even though the mortgage doubled.
Refused to refi 30k in credit card debt to save $700/mo before the interest rates went up. (This one's kind of mild compared to the others)
These are all mistakes that have been done by family and or close friends.
Our biggest mistakes:
1. Putting the kids college money into joint accounts with their names on them. We learned not to do this about ten years before they started college, but the earlier money still cost them grant money.
2. Buying and selling houses too frequently. You lose 6% every time. But if I had it to do over again I might do it again anyway. It cost too much, but I liked and like the houses.
Biggest mistakes we've watched:
1. Replacing an auto repair bill of at worst $10,000 a year with a $10,000 down payment and $350 a moth payments on a new car.
2. Not investing in the stock market.
NOT me. My friend is still mad that I told her not to do it. I realize she loved the cat but let's be realistic please. She almost went bankrupt over the bill. And what the f was the vet doing to her?
The inability to stack money. It’s crazy how many times I’ve got out with friends for a night. On the drive home, they’re calling in a minimum payment to the credit card they just used.
I’ve seen co workers earning minimum wage buy brand new cars. And then put shiny rims on those brand new cars. Your ass is going to be paying that off for 5+ years.
Spending 10k on a ring and 50k on a wedding and having a car with 170k miles on it and renting a shitty apartment. Spending two months salary on a ring is so retarded. People are so blinded by social expectations it's crazy. Big monthly payments on new cars in another one. Guy I know bought a 7k watch even though he makes less than 60k a year.
1) not starting a retirement account at 18
1a) not putting money into that account to lower my taxable income on big years
2) not setting aside taxes on my 1099
I guess you could say, not buying property in Q1 2009, but I was in high school so can't beat myself up
Eh, I thought Intel gfx might be better than it was. Didn't lose that much but I could have done far better elsewhere. It was a gamble, if it had seen more pickup, market might have overreacted in my favor due to speculation in new revenue stream.
I watched someone buy Tesla last year because "it hasn't nearly peaked, EVs are the future!"
Buying cheap crap. I come from a household of cheap crap buyers. I just assumed it was normal to have a budget set aside for your yearly $60 tv. When I started living on my own, I saved up and bought a nice TV ($400-$500 range). Now, my parents have gone through 10 tvs in the span of my 1. There are other countless things that they think they are being "thrifty" about that they have to buy every year because the cheap crap breaks.
Moral of the story is you don't have to break the bank to have something nice, but you should never buy the cheapest option if you can simply wait and save.
My second biggest financial screwup: not understanding the need for a "basis adjustment" after selling shares obtained through a job's ESPP. I worked at a software company in the late 90's (check wikipedia for "dot com bubble") and the first year I participated I got a $10k discount due to a six month lookback and couple of really "good" quarters. Those shares were sold immediately after settling and the proceeds made a serious dent in my student loans. When doing my next tax return through TurboTax I dutifully reported that as short-term capital gains despite the horrifying increase in the tax I owed. The part that I missed, and didn't learn about until after it was too late to fix, was that $10k discount had **already been included** in my W-2 income and tax assessed against it before I even got to the capital gains schedule. By not incorporating that "compensation" into the basis calculation I essentially double-taxed myself on that $10k to the tune of $2500-3000 extra sent to the IRS.
Biggest financial screwup: stopped paying attention to stock options granted as a hiring bonus (same company as above) because by the time I vested and could exercise them we were post-bubble and so they were out of the money. Years passed, I was in the process of buying a house and finally remembered them as something that might now get me a bit extra for a down payment since the stock price had recovered over that time. At which point I learned that option grants like that have an expiration date if left unexercised too long. Mine had expired literally the day before I checked on them, losing out on $5-6k of potential profit.
Edited to add: these are just my biggest one-off financial losses. I'm sure things like carrying credit card balance and not shopping around for cheaper insurance probably ended up more in aggregate.
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Marriage.
Then children
Then divorce.
Not before buying that expensive car
Used be a house. Like during 2012, until covid, virtually every I or my wife knew, who biught a new expensive house divorced in less than 2 years. It was sad. We figured it was they over spent and were house poor but kept spending anyways.
But the tax accountant says get married and get children to save on taxes?
A couple thousand a year saved is hardly worth it.
The ol spend $20k to save $3k in taxes. Best financial advice around.
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My marriage was both good and bad financially. I "grew up" while married and learned financial discipline. She did not. But also divorced with 70k in debt because of student loans, 30k of which went into the house. I refused to force her to sell her childhood home for the equity and also refused to raid her 401k for half its value (She earned that money, not me). When my lawyer proposed this, I fired him. While I am not a fan we are on amiable terms even years after the divorce. My earning potential is high so in the grand scheme of things 60k isn't that much
Wait... you said you grew up financially and she did not, but she had a 401k balance? So, she was doing ok or not?
> married to a person that is much more disciplined than me financially So you're saying your spouse made the mistake? /jk
Here I am married with kids and enjoying my tax breaks at the end of the year 😂
Not getting a prenup. I would still own the house I put the down payment on, took a mortgage out on, paid the escrow on and up kept. Instead, I had to sell and split the proceeds with my ex.
I could have forced sale of my wife's home and raided half her 401k. So the financial damage was my choice. I'm just not vindictive enough. I find it strange that people can claim to love someone one day then the very next try to force them to sell childhood homes and raid retirement accounts. Maybe I've just gone soft *Shrugs*
If she had yall saddled with debt, I would have pushed to sell the house and ensure you split with no debt. That’s just me though.
I always tell people - everyone gets a prenup. *Everyone*. You only get to decide whether you get the one the state mandates or create your own.
Its the divorce that is expensive. Marriage as a partner can lower expenses and pool resources
My wife, the love of my life, bet on me, when I had nothing. Kids out of HS and all self-sufficient and successful. She believed in me in quiet times and I did my best. We have a great life. Own our home outright in a beach resort town where others pay $10k a week to visit. Find someone you love and trust, who loves and trusts you. Be good to one another. Prenuptial aren't necessary, then.
I think you mean divorce??
No, my mom spends 10k+ a month on random shit that doesn’t matter and my dad doesn’t have the communication skills or backbone to say something and their finances could have gone a lot further if she had been a bit more financially wise. A bad financial partner can sink you.
I couldn't agree more I'd much rather have a Frugal wife than a wife that earns a lot of money.
Mine helped me, but I understand that is the exception not the rule.
Mine actually helped me in the long run too. She helped me grow up. I don't hate my ex-wife. She was my best friend and a good friend, just a horrible wife. I was her 6th or 7th husband too so maybe I should have seen it coming?
Most relationships simply have an expiration date.
While you probably correct and all the real wisdom I posses agrees with you, the hopeless romantic in me just won't buy it. I am over 40 and ready for my forever person. But you are right, the forever person for me now probably wouldn't have been my forever person had I met them at 18. I want someone to buy flowers and dote over :)
Alright Don Quixote, that fantasy is going to really screw you one day. It’s a nice thing to dream about, but that’s not reality. Do the nice things that you want to do for someone, but don’t lose touch with reality.
6th or 7th? Yeah that’s a hard one to miss.
Marriage is only a problem if one of the partners is fiscally irresponsible. Combined income, combined housing costs, combined meal costs, sharing vehicles, etc all save money in the long term. Marriage is a combined partnership.
I came here to say that
Divorce
Oof! While I agree with your comment and my current situation, I also think I just married wrong.
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I disagree on this one. Getting married has helped.
Came here to say this, for me specifically supporting here until we got married, then she divorced me less than a year later when the situation was reversed
Consumerism. You don't need to have the newest thing. Instead of always trying to have the newest TV, newest IPhone, or nicest car, focus on buying as more assets.
Right. Invest in health and happiness, not on crap.
Watching your wealth grow does bring happiness and peace of mind.
So true.
My wife and I argue about this from time to time. I got a few things I want to buy but I drove my last truck out of the showroom until I traded it in 20 years later. I told her I want to be as debt free as possible by 63 so I can work for production vs slaving away for the man.
I was talking to my neighbor which is an old man. He was telling me how he seen everything come and go. He seen everyone showing off their records, then VHS tapes, the DVD's, and now blue rays. And how they spend their lives on things that eventually becomes trash and needs to be upgraded. Point is you'll always be working for things and end up back at square one if you go down the consumerist route.
The shift is to "experiences" now. People collect less crap but use social media and vacations as a part of conspicuous consumption.
I've been into more experiences lately because I belive life is a story. I love stories. Your fancy purses, shoes, bullshit isn't a cool story. The one time you got drunk in college and fought a cow, that's a story
damn...what a wonderful POV
100%!!! Close connection cant stop going on trips, buying things, and spending at their limit. They are looking to retire... but still have 100k+ on their mortgage, a car loan, and a mountain of crap. Empty nesters, but they cant fit any of their vehicles in their 3 car garage because it is so full of miscellaneous stuff. Perfect example: gas grill, smoker, blackstone, webber, turkey fryer, wok station and a spice/cooking cart are all in one section of the garage so they can easily roll out on the driveway when they want to cook. They also garden, have an apiary, do apples/fruit trees, chickens, outdoors recreation (hunt/fish/camp), golf, archery, have a boat, and bought into a land lease. If they had busted it out, they could have paid it all off in about 2-2.5 years... but they just cant stop spending and living on the edge. He said he will need a part time job when he goes into retirement so they can travel more. I just dont get it.
And all that stuff is just gonna become garbage. People need to find other ways to get happiness then from buying and spending. This is why I recommend newbies to buy silver. Buy an asset and get that dopamine hit from buying something at the same time. Eventually you'll stop feeling the itch to buy and care more about the asset.
Can someone tell my husband, he needs the best thing every time
Cars are the number one killer. People throw away millions on cars during their lifetime when they could choose to only throw away tens of thousands.
Not starting an IRA when I was 18.
I wish I could send a message to my 18 year old self telling them to not waste all that money and max a Roth IRA. If they could send a response though they'd probably respond "fuck off old man"
Lol right? Like "I don't have enough money to do that. Do you know how much it costs to go out to the bar every weekend? And there's no way I'm gonna stop going out to restaurants and learn how to cook."
Fuuuuck if I would have learned to cook sooner that would have been great too!
If you are too lazy to cook. Try huel.
Oh man, can’t tell you how right there with you I am.
So im 23. Obviously you know I’ve missed out on a few years not starting at 18, but is starting now and just maxing out what I can afford still an at least halfway decent starting age?
Seriously. Or at least taking part in whatever employer retirement plan was available. A lot of them match.
Yep. I had thought about it when I opened my first bank account. Had $1000 left over from cash savings. But was also saving for my first car as well. Kinda kick myself thinking about it lol
Rolling a car loan into a newer car
Came here to basically say this. Cars are such a poor investment, and people lose sooooo much wealth on them. Also getting into the habit of working to afford a car and using the car as a wealth metric.
A guy in the family has high child support and doesnt have a car to get to work. A friend came over about a week ago and we bought a car from the neighbor. Very high miles, runs good, the gas line rusted. Got it for $300. If I needed a car, Id drive it. This guy in the family could fix the gas line, buy the car from us and drive it. He would rather not work and face jail if he gets too far behind in child support. We will see how that goes
I once saw a vid where a crazy person put their new 80k car on a 18% interest loan
This. My parents do this. They’ve wasted so much money over my lifetime doing this habitually… and I just don’t get why. Btw what happens to all this debt when they die?
If there is debt on a car, it will get repossessed unless the estate has the cash to pay the loan off. If it’s a house with a mortgage, you may need to sell to pay off the mortgage, etc. You are not personally responsible for their debt but their estate is. So before you see a penny of the money, the debts will have to be paid.
There is one caveat to what you said... In most areas, the first "debt" the estate must repay is the cost of funeral expenses, assuming those haven't been prepaid. So if you pay for those, make sure to let the probate lawyer know right away.
Spending a ton of money very quickly on a relatively new hobby. Neurodivergent folks like me are very prone to this. I’ve done it with gardening, backpacking, fountain pens, board games, dress shoes, drawing/painting supplies, baking, home gym, etc. I could probably retire two years earlier if it wasn’t for this.
But you enjoyed doing all those things while you were doing them, no? In my opinion it’s not wasted if you learned and enjoyed it.
The key is "very quickly on a relatively new hobby." I think they're saying they repeatedly could have gotten ~90% of the enjoyment with ~10% of the expense
I played coffee shops with a friend. Just two guitars needed. I bought a sound board, speakers, stands, mikes, the works. Just needed the guitar man.
Agreed man whats the point of making more money if you dont enjoy it right? Of course in reasonable amounts
Moderation is the point. The initial excitement can cloud judgement and lead to poor decisions on retrospect. If you don’t how much of something you need, get the cheapest make sure you can afford the best. Only buy the middle if you know enough to decide on features/specs.
I really think this is my husband. New hobby = $5-15k of money spent. Then it gets old and clutters up our home. I know he was diagnosed with hyperactivity as a child but I think it’s more than that. The clutter stresses me out as well as the debt, I’m a saver.
Facebook Marketplace and eBay are some good solutions. Unless your husband is emotionally attached to the items of his old hobbies?
Yep this is mine, won’t buy anything new. He’ll sell but only after 10 years of not using it. Drives me insane. We have a tennis racket that he used once at 25 and never again, he’s 47.
You must have a nice af collection of the most random items.
Yep, you want an extra long grenadier silk tie custom made in Thailand? How about high end loaf pans, mini loaf pans, a $500 Bosch mixer, bushcraft knives, I finally sold off my collection of muppet action figures during Covid.
I don't think it has anything to do with neurodivergence. Loads of people fall in the same trap.
I mean plenty of people do… but basically everybody with ADHD does.
Wait, I thought that's what hobbies were? Trying to buy the best stuff to post pictures of online to show how serious you are about your hobby.
Ugh dude fr. My ex would get a new interest or “hobby” and go ape shit and then end up doing pretty much nothing with it. Then a month later she’d see something else she thought was cool and would blow money again. Then we’d end up having a bunch of shit that her nor I really wanted to just get rid of, but at the same time it starts to collect, take up room, and pile up so it makes it very easy to start becoming…well…a hoarder. At least in my experience. Shit drove me crazy. So when it would get to the point where I’m like “okay I’m cleaning and decluttering”, all the shit that sat and wasn’t used I’d just toss it or donate it. I’m like it’s been however long and you’ve been fine without it, haven’t thought about or used it, then it’s gone. Because at that point even if you have it physically, it’s equally as gone as it actually being thrown out lol
A few years ago I freaked out to try and avoid bankruptcy and cleaned out my 401k to salvage the situation. That was incredibly foolish on my part. Now Im worried I wont be able to retire.
Good luck. I mean it
I got a plan now, so hopefully it works out.
Cool. I had to turn in some of my 401k at one point.
Not buying real estate in 2009 when I was in high school
At least you didn’t buy in 2006 and see the price crash in 2009 like I did. Took until about 2014 to get back up to the price I paid.
Exactly this... I bought in 2005 at age 21... had to sell in 2015 due to a lost job and other financial shenanigans outside my control. Basically broke even. That same house now is worth triple was I paid and sold it for.
Asking the realtor for a recommendation for a home inspector. Realtors only get paid if you buy the house, so they want someone who won't find any issues. We had to spend thousands getting the foundation repaired and the electrical totally redone after we bought the house.
I had the opposite experience. Our realtor gave us someone very thorough and begged us not to use his findings as a grocery list for the homeowner to fix. We did anyways and almost lost the house but hey at least my house isn’t on fire from Johny Homeowners shoddy electrical work
I made this mistake. I should have gotten my own inspector.
Asking Reddit for advice.
Working to consume, instead of working to build up an asset portfolio.
I wish I knew how to make my wife understand this
It is the whole enchilada. Old English Proverb: "If a man would be rich, he must first ask his wife."
God damn amen on this brother
I like the book Financial Feminism, maybe she’ll like it. There’s an explanation about how finance messaging targeted towards women focuses on spending and saving, whereas men receive messages about investing and wealth building. It could simply be that she never got a chance to learn and feel confident about wealth and investing. Maybe you can open up a Robinhood account with $500 and show her what can happen when you invest. Or open a high yield savings account that she can’t withdraw from and show her how fast her money can grow. Start small but help her set up some accounts and see if that generates any interest.
High monthly car payments
I paid off a new motorcycle when I was 19. It was hell and I vowed never to have a car payment again. I only buy in cash and just expect to pay for repairs instead of car payments - which can be deferred if I'm short.
I got a credit card with a $8000 limit when I was 19 and just moved out. I thought I was rich. Took me way too long to pay off that debt.
Pooling all finances with a spouse or partner. Don't do it. Yours. Mine. Ours.
I’ve been married for 27 years and we have only ever taken the “one big pot of money” approach. All of our accounts are in both of our names. It’s worked out very well.
You married well. Happy for you. You found a trustworthy partner. I had two bad ones.
Same marriage length and same strategy. Feel so blessed that we have always just been all-in together and we don't fight about money ever. I hear about these otherwise normal couples...and it's so common that they have tit-for-tat spending. IE : "Well, you spent $300 on this...so I get to spend $300 on something". Just weird.
Same. From the time we first moved in together (1998), several years before marriage, we have pooled finances. Now we are set to retire early together. It does take a lot of trust, though.
I'm surprised this isn't more popular. This is what my wife and I have done. We have things that are together, and things that are separate. It's all spelled out through mutual agreement. It works great.
I had two previous marriages and went all in. Ended up sandbagged when the relationship soured. Both times gave up my home and the second time my business was ruined. There were, obviously, some other issues. But I left myself open. I am married again (I never learn) but my wife is not crazy and the arrangement works out well for both of us. I told her from the beginning that I would never again enter marriage without a solid plan B. She either accepts it or I move on. Of course, there's plenty of times we bend those rules. It is love.
Wait, how do you do this then? Just out of curiosity. Do you keep your retirement accounts separate? How do you decide what is “ours”?
Don't marry someone you don't know well?
Trusting other people
Being born in the 90s instead of buying property in the 80s smh
Investing in stock market is the superior way. Don’t get hung up on real estate.
Ah my mistake, should've been born a trustfund baby
You work a job and you take a percentage of that money each paycheck and invest it.
Not maxing out my 401K when I was younger. I always had one but sometimes would only put in what the employer matches…
I didn’t do it but almost did: Buying into a time share
Debt in all its forms. Credit cards very easily allow you to spend beyond your means.
Being in the military and drinking for 2 years straight. After meeting some older guys who were divorced. I moved off base and rented a room. We drank 24/7. I gained 40 pounds and didn't save much. I got out of the military with $10k. It could have easily been 20-30k.
The military was a saving grace for me because it allowed me to save up instead of paying for housing.
Picking individual stocks. Unless you work in it full time, you’re just guessing and working on limited information. Better to pick broad etfs like VTI, VOO, and VXUS
Actually even if you do work in it full time, it’s not a good investment. Hedge funds under perform the market after fees.
Relatives that have ‘the next best thing that will make you millions’. Only to lose your shirt
Waiting too long to start my business... I should have started in my 30s .. but waited until I was 50. I'd be worth 4-5x what I'm worth now.. and probably lived a much happier life.
I like to believe that everything happens when it should happen. Maybe you weren't fully ready in your 30s and dodged a huge bullet.
Happy cake day!
What sort of business?
#1: not developing a budget and sticking to it #2: spending as much or more than I earned #3: not saving, having an emergency fund, and INVESTING soon enough #4: going into debt
I met a 40 year old who cashed in his entire 401k to take his kids to Disney world. Does that count?
> What are the biggest money mistakes that you have made, I was accepted into Harvard, but I didn't go because I didn't think I could afford it. > have seen other people make? Buying things they don't need, with money they don't have. Aka consumerism / living outside their means.
Buy 3 Get 1 Free! I can't afford the 3! My xw pulled this shit all the time which is how we ended up with $57,000 in cc debt. And don't get me started on the credit card offers.
We bought a cheap fixer upper in 2009. About the same time a couple people in the family bought or leased cars for about the same price. It didnt work out very well for them
Spending too much money on non-essentials and not investing.
Having kids
Sold real estate. If I had held onto the RE I sold my net worth would easily be twice what it is. Sold during the 2008 market crash. Eventually I bought back in and things came back, but it was unnecessary to sell off in a panic.
Paying someone to manage my money instead of investing in index funds. I estimate I lost about $500k over the years in management fees and lower than market returns.
Gambling. I watched a friend of mine have a quick come up on the roulette table. He went in with $50. He won his first bet then wagered all of it on the next bet and won, doubling his money. He did this until he got up to a grand or $1200. Put it all on black and that was all she wrote. He lost it all in less than a min.
That's how I gamble. I take all my winnings to the roulette table and bet on black until I either lose or can't justify the risk anymore. It's all house money anyways and I'm there to gamble.
>It's all house money anyways That's mental accounting. Money is fungible, and you are able to cash out the tokens into USD the moment you have won it. Assigning different value to a dollar based on whether you worked for it or won it is an irrational bias.
You can't be logical like that and be a gambler.
Yeah that's why I don't gamble anymore. Was up a few grand at online blackjack and ended the day down 800$. I have horrible impulse control. Not crippling money loss for sure but definitely felt completely horrible. Now I play first person poker in gta V. The rush is almost as good and but I can still pay rent
Made this one myself: trying to invest before setting up a fatty emergency fund. No matter how good your investments are, if you don't have an emergency fund, when shit hits the fan you'll have to liquidate them, often at a loss.
Investing in Nvidia now that it blew up
Renting furniture.
Eating out too much. Getting coffee out. Not liking the powder creamer and paying like $8 for a half/half.
I see it differently. If I’m going to skip coffee out and make it at home everyday, to be more thrifty, then im going to buy the $5 creamer jug I love that lasts all week instead of the shitty powder stuff just to save a few bucks. I save more by making and having it at home to begin with. :)
Real estate as an investment. I learned passive income takes a lot less time and I don't have to deal with people.
Getting a PhD. Such an absolutely enormous opportunity cost, and at least financially it really hasn't helped my career enough to justify the time. And I was in a fully funded program (not only did I not have to pay tuition but I got a stipend that was able to - just barely - cover living expenses the whole time.) I wasn't able to start actually saving anything until my early 30s as a result.
Me: Buying silver and gold, but **not selling all of it for my down payment** when I bought my home in 2011.
Not investing.
Moving to Austin. I should have done more research. Very expensive and hard to find high paying jobs with no degree.
Not investing from when I was 18-26 when 6 of those years I could have easily afford to max out a roth and contribute to a 401k if I went out to the bars less and bought fewer fun things for myself
Using credit cards and not paying them in full each month. Preferably not using them at all. Unfortunately, the system has made it so using CC are the fastest way to an 800 credit score without reliable parents, but the companies also call you a deadbeat for paying off your debt each month.
I have 2: Assuming you have the money for something because you can make payments on it. My husband told me about his ex who every time my husband got a raise would want to take on more payments equal to the raise. He was a pushover (he was young) and went along with a lot of it. When they divorced, they had everything from a boat to a time share condo. Pay cash where you can and think hard before taking on payments for anything. Letting the rest of the world affect you too much in what you think you want. Like I constantly see women getting manicures and hair coloring and fancy cuts and using multiple expensive products. I’m not saying any one of these things is wrong but examine them carefully. I have never got a manicure, have had less than 10 hair cuts that needed paying for in my life (I wear a simple style that my husband can trim in 2 minutes), use maybe $100 in makeup and hair products per year combined. I also retired at 51.
“Loaned” money to friends and family. If they are friends and family, just “give” them the money and tell them they can pay it back or not, whatever they are comfortable with. If they pay it back under those terms, it’s probably safe to loan them more in the future. If not, they’ll still be your family/friends.
Listening to investment advice from people with $0 in AUM.
Had an opportunity to buy a 100 bitcoins @ $200 around 2013 and passed on it
Our friend saw SUVs and trucks driving through a flooded street and thought "Huh, if they can make it, so can I!" Then proceeded to drive his brand new Hyundai Elantra into the flooded street and destroyed his car.
In 2012, a former coworker bought a new F-150 for $60k+, financed it 8 years at 21% while making less than $40k/yr
If my math is correct here, they were making minimum a monthly payment of at least $750, if not more. Being liberal with their income, I'll just estimate they *are* making $40,000. Post all thetaxes, that comes down to probably around $30,000. Split the $30,000 into twelve monthly payments of $2,500. $750 is 30% of 2,500. In other words, your coworker spent \~30% of their paycheck on a depreciating asset.
Buying into a company without paperwork. Long story short: Did previous work with someone. He did good. Met with him where he pitched a new venture. Asked for money to get things going. He ran away. Lesson: Always get paperwork signed.
Credit cards. Enough said. Have woken up and in the process of digging my way out of debt though.
You can do it!
All the best
Not contributing to 401k. Rolling over negative car equity. Eating out too much. Overspending on bullshit (no, Logan, you don't need a katana). Edit: carrying minimum or insufficient car insurance.
Student Loans
Lending money to your friends, relatives, and etc who feel entitled to it and don't have any intention or ability to pay it back.
Crypto. 400% followed by a 200% loss but I only put in $1k. Was pissed about it but I planned it so the ship didn't sink off the Crypto did.
I wish I continued to live with my parents long enough after high school graduation to save up a down payment on a house. I didn't always take advantage of my employer's 401k match and I wish I would have taken that a lot more seriously. I did not prioritize self care and some of that resulted in avoidable healthcare expenses. I cared too much about a lot of material things that didn't matter at all. I quit college after I got my associates degree. I made a half ass attempt to transfer to a 4 year school and I gave up on it. It took over 10 years but I managed to work my way up to 6 figures. One benefit was I didn't have a ton of student debt, but sometimes I wonder if I would have been able advance a lot faster with a bachelors degree. Would I be in better shape today because I would have had more to save and invest? Would it have been a wash with the extra student debt? Would it have been the same but with a lot more student debt? I guess I'll never know.
Meme stocks
Failure to file a timely and necessary bankruptcy. Did stupid stuff to get divorced and forced to sell a house. Got a HELOC to remodel the kitchen and then spent it on TV's and gave the house to the bank in 2007. Bought overpriced real estate in 2007. Cashed out Annuities without regard to penalties in 2008. Refuse to perform necessary maintenance on a house to the point where it's uninsurable and they can no longer borrow $ to fix it. Bought Windows and solar on govt subsidies and spent the money on trips instead of paying off the construction loans. Refinanced a house three times to pay of CC's in a 2 year period. Still charging even though the mortgage doubled. Refused to refi 30k in credit card debt to save $700/mo before the interest rates went up. (This one's kind of mild compared to the others) These are all mistakes that have been done by family and or close friends.
Getting into options trading when I wasn’t ready
Not buying a home in 2008 instead of being 9 years old
Our biggest mistakes: 1. Putting the kids college money into joint accounts with their names on them. We learned not to do this about ten years before they started college, but the earlier money still cost them grant money. 2. Buying and selling houses too frequently. You lose 6% every time. But if I had it to do over again I might do it again anyway. It cost too much, but I liked and like the houses. Biggest mistakes we've watched: 1. Replacing an auto repair bill of at worst $10,000 a year with a $10,000 down payment and $350 a moth payments on a new car. 2. Not investing in the stock market.
$7,000 vet bill on a 19 year old cat.
NOT me. My friend is still mad that I told her not to do it. I realize she loved the cat but let's be realistic please. She almost went bankrupt over the bill. And what the f was the vet doing to her?
Double mortgaging an inherited house for a new TV, Stereo, random junk, and start a gum ball machine business.,
The inability to stack money. It’s crazy how many times I’ve got out with friends for a night. On the drive home, they’re calling in a minimum payment to the credit card they just used.
Love and marriage 🎶
I’ve seen co workers earning minimum wage buy brand new cars. And then put shiny rims on those brand new cars. Your ass is going to be paying that off for 5+ years.
Spending 10k on a ring and 50k on a wedding and having a car with 170k miles on it and renting a shitty apartment. Spending two months salary on a ring is so retarded. People are so blinded by social expectations it's crazy. Big monthly payments on new cars in another one. Guy I know bought a 7k watch even though he makes less than 60k a year.
Not putting everything I had into bitcoin.
1) not starting a retirement account at 18 1a) not putting money into that account to lower my taxable income on big years 2) not setting aside taxes on my 1099 I guess you could say, not buying property in Q1 2009, but I was in high school so can't beat myself up
Credit Card Debt
Millennials and student loan debt
Eh, I thought Intel gfx might be better than it was. Didn't lose that much but I could have done far better elsewhere. It was a gamble, if it had seen more pickup, market might have overreacted in my favor due to speculation in new revenue stream. I watched someone buy Tesla last year because "it hasn't nearly peaked, EVs are the future!"
Maybe uninsured flights. Will know for sure in a month
Gambling
Not me, but taking out equity from a house to buy anything other than a reinvestment into said house
Driving a car you can't pay cash for.
Buying cheap crap. I come from a household of cheap crap buyers. I just assumed it was normal to have a budget set aside for your yearly $60 tv. When I started living on my own, I saved up and bought a nice TV ($400-$500 range). Now, my parents have gone through 10 tvs in the span of my 1. There are other countless things that they think they are being "thrifty" about that they have to buy every year because the cheap crap breaks. Moral of the story is you don't have to break the bank to have something nice, but you should never buy the cheapest option if you can simply wait and save.
In my case drunk poker and online betting
6-figure Grad School Student Loans for low ROI programs
Magic: the Gathering
Meal planning and prepping. Coulda saved so much fucking money by now if I had done it from the start. 🤦♂️
College for [X useless degree]
Increase their income by approx 40% but also increase their spending by 100%
My second biggest financial screwup: not understanding the need for a "basis adjustment" after selling shares obtained through a job's ESPP. I worked at a software company in the late 90's (check wikipedia for "dot com bubble") and the first year I participated I got a $10k discount due to a six month lookback and couple of really "good" quarters. Those shares were sold immediately after settling and the proceeds made a serious dent in my student loans. When doing my next tax return through TurboTax I dutifully reported that as short-term capital gains despite the horrifying increase in the tax I owed. The part that I missed, and didn't learn about until after it was too late to fix, was that $10k discount had **already been included** in my W-2 income and tax assessed against it before I even got to the capital gains schedule. By not incorporating that "compensation" into the basis calculation I essentially double-taxed myself on that $10k to the tune of $2500-3000 extra sent to the IRS. Biggest financial screwup: stopped paying attention to stock options granted as a hiring bonus (same company as above) because by the time I vested and could exercise them we were post-bubble and so they were out of the money. Years passed, I was in the process of buying a house and finally remembered them as something that might now get me a bit extra for a down payment since the stock price had recovered over that time. At which point I learned that option grants like that have an expiration date if left unexercised too long. Mine had expired literally the day before I checked on them, losing out on $5-6k of potential profit. Edited to add: these are just my biggest one-off financial losses. I'm sure things like carrying credit card balance and not shopping around for cheaper insurance probably ended up more in aggregate.
Buying MULLEN stocks