Your Biggest Money Mistake
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All of us have made mistakes. I’ll hazard a guess that most of us have made some money mistakes.
Whether it’s a lack of budgeting (been there), spending more than one makes (been there, too) or poor investments (ahem), you’re probably not alone in having had some red on your ledger.
FishBoy13 asked me about the stock market crash today. That led to a conversation about investments and speculative financing. Of course, the topic of our rental house came up. It probably ranks very near the top, if not the pinnacle of financial mistakes we’ve made over the years. And we’ve made plenty of them. It’s the one that continues to hound us.
While I would advise most people against investing in rental property, there are probably plenty of people who do really well in that business. More power to you!
That has not been our experience. There have been a series of tenants over the years who have flaked on paying rent, trashed the house, stolen the appliances, and otherwise left us with thousands of dollars in clean up and repairs. When the court won’t enforce a ruling, there’s really nothing you can do. Especially when said person skips town.
If you rent, I recommend that you not assume your landlord is sitting pretty. That certainly has not been the case for us. We have lost money on this property every year since we bought it in 2005. If it wasn’t a bad tenant, it was something breaking or a roof that needed to be repaired. Currently, we owe more than the house is worth. Once the market and our mortgage match up, we’re selling as soon as you can say, “How much?”
That said, I’m thankful that we have (mostly) gotten our finances in order. God has been very gracious. We only invested in one measly rental property, instead of the dozen that we once dreamed of. One headache, not twelve. I’m sooooooo very thankful for that.
I can manage this, as much as it stinks. I can do this. We have a good management company, our personal finances are in order, and we’ve got a plan to fix this mistake as soon as possible. It still stinks, but it’s doable.
Have you got a money mistake to share?
No judging allowed. Just a chance to know you’re not alone. Tell us your biggest money mistake. If you solved it in a great way, share that with us, too. We can always use a good redemption story!
This is Frugal Friday. In an effort to make these weekly financial discussions more interactive, I’m no longer posting a link-up. Feel free to leave a link in the comments. But better yet, chat with us on today’s topic.
first our biggest money mistake was using credit cards for just “small” things but gradually went to larger items ……..we are now working on paying that down….sigh………………………..second as owners of rental property it isn’t all bad, we went into it knowing there would be bad renters……YES we have been left set w/ several months rent before more than once, but the pros have far out weighed the cons…….we bought a place literally next door to us & if someone else would own it we may still 2 years later have a drug dealer in our neighborhood but my husband asked if he would be willing to move after we found out & he was, if someone else owned it, it could be a scary thing for not only our family but several other families as well. ………..thus saying you should never let a realtor manage any rental you may own…..all they think of is there commission & not your best interest. you have to remember NOTHING is a “bed of roses” so any investment whether it be rentals, timeshares, etc is going to have problems….the ? is are you up to the challenge. thanks for letting me share
I know I’m coming to this comment section late, but my story is a little bit different and might need to be heard by others. My biggest money mistake was buying $10,000 worth of day care equipment without consulting my husband. I was running a small day care and looking to expand it into a much bigger endeavor but wasn’t there quite yet. I rationalized that it was “my” business and that “my” business could afford this $10K purchase and the business would be paying for it, not our personal finances. You can imagine how gut-punched my husband felt when he found out I bought out a day care that was closing and had sunk us into debt $10K. He didn’t see the difference between “my” expenses and “our” expenses. (imagine that!) Obviously, since we were married, any debt I incurred effected him also. In the end, I never expanded my business to the degree that I would need that much equipment and I ended up selling off the remainder of the equipment. I am confident that I recouped my entire $10K but since I sold it off a little at a time, it’s hard to know for certain. My husband still questions whether I ever recouped it all. However, the lesson learned was certainly not about whether it was a good deal or not a good deal or whether or not I got all my money back when I sold it all. The bottom line was I should’ve never gone behind his back with a $10K debt.
Thanks for sharing your story. That was a hard time, I’m sure.
With those words changed after the fact poof away went all my military retirement!
I’m so sorry that happened to you. The thought of that literally made me nauseous. Thank you for your service
My biggest Money mistake cost me $2 Million dollars yes that is right 2 million!
When I was getting divorced I believed my ex husband and it turns out it was all lies the one change of “in addition ” to ” In The Event” cost me at least 2 million dollars!
Watch out for the FINE PRINT!!!!
I very much regret sinking 30K into my master’s degree. While I don’t recommend student loans, I gained a lot from the true undergraduate experience and don’t regret that…but I would’ve managed my earnings from part time jobs and the loans better so I wouldn’t have needed as many loans as I took out.
Even though my husband is using his degree (optometry), taking out student loans was his biggest mistake. He graduated with 130k of debt; 9 years later, we still have 74k left. Looking back, he wishes that he’d gone into a branch of service upon entering optometry school. Then his school would have been free (even though he would give just 4 or 5 years in return working for the service).
Having a husband who had the military pay for his schooling… Its not as awesome as it seems.
Although it might be “free” he would pay for it in other costs. He would not have been home several days, weeks, months or even over a year. There is a little war going on in the middle east. Then there is always the possibility that just when he had graduated, and was ready to start his practice he could be called up for a deployment.
My husband still had to take out roughly 15,000 in student loans to cover what the VA didn’t. The paperwork for it was terrible, and he literally lived on bologna sandwiches for 6 weeks one semester while waiting for his money to come in. Remember it is run by the government 😉
With all that said, my husband and I are both very proud of his service, and we commend anyone who joins any branch of service. But there are two sides to the “free” education story
I think we have made every money mistake out there, pretty much ;). I think the worst one is my student loan debt to the tune of $30k. I did get my degree, but I’m still a SAHM. We did start a business last year that I work from home, and my husband works with me on the weekends. It has the potential to make a lot of money, and we have increased revenue every month since we started. We have been on Dave Ramsey’s BS2 (the debt snowball) for the last 5 years or so, and we will be on it for several more. I think a lack of organization and momentum (at times) has really not helped, but we are recognizing the problems and working to not ever have them again. We are making progress, and that is better than no progress :).