I have been writing here at NinjaBudgeter for two and a half years now. Most of the opinions on this site are my own. Last week however, I was having a conversation with my wife about a big financial mistake we made a few years ago and it got me thinking – I wonder what other blogger’s biggest money mistakes are?
So rather than write another post from my point of view, I went onto a few of my favorite Facebook blogging and finance Facebook groups and asked this question: What’s the worst financial mistake you have ever made?
I was surprised by the diversity of responses that I received. I just assumed that for most people, their biggest regret would be a large, personal purchase such as a home, timeshare or pickup truck.
It turns out that we finance bloggers have gotten ourselves into a variety of sticky financial situations. Keep reading to find out what mistakes personal finance bloggers recommend that you avoid.
Top money mistakes made by personal finance bloggers
Jeff Proctor from DollarSprout
The biggest financial mistake I have ever made was not saving up more money before quitting my job to start my own business. I had read everywhere that you “should have at least a years’ worth of expenses” saved up, so I followed that advice. The only problem was, it only took me 9 months to burn through 12 months of cash (life happens). Also, my business wasn’t even remotely close to profitable after 9 months, so I had to go back and get a real job.
Starting 100% over with virtually zero dollars to my name (in addition to outstanding student loan debt and a car payment) was extremely deflating, but it taught me a valuable lesson: always err on the side of caution when it comes to your finances!! Bad things do happen and things will never go as smoothly as you think they will.
Kelan Kline from The Savvy Couple
Our biggest financial mistake was purchasing a house too quickly. We got married and bought a house a few months later. My wife Brittany was still in school finishing her masters in education. I landed a good paying job in law enforcement as a Jail Deputy. Somehow we got pre-approved for our mortgage and I had not even received a paycheck yet. They approved us with just my acceptance letter, crazy!
Buying our house well before we should have financially basically took away all of our freedom to move to different jobs at the time. I feel into a deep depression working as a Jail Deputy with the crazy hours, negative environment, and stress. I was forced to work there until we could save up enough money for me to quit and try a different career. We also had to pay PMI the entire time because we had such a small down payment. Looking back I would have waited at least another year before jumping into home ownership.
Drew DuBoff from DrewDuBoff.com
Without a doubt, my biggest financial mistake is paying for subscriptions that I don’t use. That’s the gym membership that I hold on to because I *think* that I will one day get to the gym or the Amazon prime membership that I think I will use even though I don’t purchase anything to qualify for shipping, I constantly missed out on money in other aspects in my life because I dismissed these costs as minimal and insignificant to my bottom line.
Well, when you’re trying to pay off loans, any and every unnecessary and superfluous cost should be eliminated. It all adds up, even the small charges. The same applies for any work or business subscriptions you may have.
Tim Jordan from Atypical Finance
My biggest financial mistake was financing things I had the money to pay for with cash. It was always interest free financing and the total balance just kept growing and growing. This started in 2012 when I bought a house and financed a bunch of stuff to put in it, plus bought a car on top of that. My total monthly bills just from all this new interest-free debt was more than $800!
I would always make plans to pay it off by the time the interest-free promo period was done but something would always come up. I had to balance transfer the money to avoid interest but this resulted in balance transfer fees. Even though I have a solid plan to pay it off now, and I stopped abusing interest-free credit card offers, I am still paying for it nearly 7 years later.
Jamie from Mr. Jamie Griffin
I paid for college with student loans. Then to make matters worse, I changed my repayment plan to the “extended repayment”. So instead of paying my student loans off in the standard 10 years, I was scheduled to pay them off in 25 years. The fact was I couldn’t afford my payments, so I took the easy way out instead of confronting my lifestyle choices.
I spent money willy nilly, went out with friends, and had no real plan to pay off my debt. I was in survival mode because I didn’t know anything different. I’m so glad I married a woman who wanted to be smarter with money and through a lot of hard work, and a lot of lifestyle changes, we paid off our student loan debt in 5 years instead of 25.
David Cahill from Finance Superhero
During my college years, I spent 4 weeks in Europe doing missions work and performing with my university concert band. I was pretty careful with my cash, credit, and debit cards, but I didn’t factor in the exchange rate impact on debit card transactions. To make a long story short, I ended up going into overdraft by a few dollars in my checking account when I bought a Whopper meal at Burger King on the last day of my trip. The overdraft fees ended up costing me several hundred dollars, even after I fought with the bank to reduce them. To date, that Whopper is still the most expensive meal I’ve ever purchased!
Andrew from Wealthy Nickel
Probably my biggest financial mistake was buying a half duplex as an investment property. We found out after closing that it had been illegally subdivided and the neighbor (who had done the illegal subdivided) was not willing to work with us to make it legal. We looked at all of our options including getting lawyers involved, and decided to sell at a $30k loss to let someone else inherit the problem (with full disclosure of course).
Logan Allec from Money Done Right
My biggest financial mistake was not refinancing my student loans early enough! When I graduated college, I had over $35,000 of student loans at a weighted average interest rate of something like 6.8%.
I shuffled my feet and ended up not even looking into refinancing until six years after I graduated college. If I had refinanced my student loans earlier, I would have saved hundreds if not thousands of dollars in interest!
Amira Irfan from A Self Guru
The biggest financial mistake we made as a family back in the day was hiring a freelancer to help us with my dad’s business without entering into a legal contract. My dad was friends with an independent contractor that he paid thousands to do some work for his business but he failed to sign a written contract with this person. We never expected the legal ramifications of this mistake! My dad got slapped with a $90,000 lawsuit few months later because this freelancer decided to sue him for all kinds of things.
The lawsuit lasted almost a year and needless to say, our life completely turned upside down. In the end, we settled the case for $50,000 but that was my dad’s entire one year income that he just lost in a snap! I never forget this financial mistake because it left a permanent scar on me and this mistake didn’t only affect my dad but our entire family suffered and paid the price for it. It’s also one of the big reasons why I became a lawyer and why I’m so passionate today to help other business owners avoid the same financial and legal mistakes.
Russell Barbour from Unconventional Prosperity
The biggest financial mistake that I ever made was that I bought an established website on Flippa. The site cost $4500 and the claimed revenue was about $200 per month. Unfortunately after I bought the site, the traffic and revenue all vanished and I have never been able to recover it. The lesson I learned was to do a lot more due diligence before buying a business!
Todd from Invested Wallet
Out of all the money mistakes I made, this one bothers me the most. In my mid-twenties I did not understand or bother to learn about my 401k. Going into my first real job, they offered a 401k after 6 months. My parents explained what that is, why it is important, and that I should sign up. Little did I know, I was not contributing enough to get the company match (free money), nor did I know what was invested or how to look at the account.
So when I was let go from said job, it was cool to see I had about $5,000 saved, but then to realize how much I probably missed out on was a kick in the teeth. It was a good learning experience, but I left plenty of money behind by not spending a bit of time learning about it.
Allan Liwanag from The Pratical Saver
My biggest financial mistake was building a retail business in 2008 (when the great recession was happening). I took a gamble without a solid business plan and spent almost all of my savings, which at that time amounted to around $60K. I ended up closing the business after 3 years and accumulated over $40K in debt. I should have invested the money in the stock market instead, and I would have come out with a larger amount of money.
Jonathan from Mr. Centsible
Becoming complacent with my job and not growing my career. I have been at the same company for a decade, which is great for stability but not for growth. I have only received minor salary adjustments for most of those years. I would recommend young adults to change jobs every so often, unless you really are on a growth trajectory at your current employer. You will likely grow your income, re-energize yourself, develop new skills, and make new connections.
Sara from Frozen Pennies
For me, the biggest money mistake I ever made was convincing myself I was not good with money. It was something that was instilled in my subconscious as a child. Then as a young adult, I racked up a lot of credit card debt and blamed it on ignorance. It took me YEARS to realize I was good at money and just needed the tools to do so. As of today, we have paid off nearly $100,000 including our house.
Fo Alexander from Girl Talk with Fo
My biggest financial mistake was believing that a financial advisor could solve all of my money problems. I believed that they had all of the answers to my uncontrolled spending and lack of budgeting, but they didn’t. Instead, I needed to put in the work and be vested in myself. Fortunately, this was a lesson earlier in my financial journey that I can now leverage to help others. I recommend that everyone get personal with their personal finances. Learn as much as you can on your own and employ help once you’ve reached a point where you can no longer teach yourself.
Adebayo Fasanya from Dr. Breathe Easy Finance
My biggest financial mistake was letting FOMO (fear of missing out) get the best of me with cryptocurrency. Bitcoin and its alt coin friends has been a fad for a while and I was doing awesome ignoring its allure and seduction. Well until the later half of 2017. I gave in to the pressure and dabbled with $7,000. It was fun for few months, my woney grew about 10X. I got greedy, and started diversifying into some questionable coins like dogecoin, electroneum, and so on.
To cut the long story short, the whole crypto market crashed. Bitcoin that was worth 21k at its highest went all the way down to $3500 or so. The alternate coins mostly dissapeared. Anyways, I wish I cashed in my profit, but barely made it out with my principal. Lesson 1 – Invest in what you understand or at least acquire the knowlege. Lesson 2 – If it sounds too good to be true, it is. Lesson 3 – Don’t FOMO.
Daniella Flores from Iliketodabble
One of the biggest financial mistakes I’ve made was signing up for a gym membership without reading the contract fully. What I thought was a pay as you go was actually a 15 month long membership I couldn’t get out of. That and a bad smoking habit I’ve since quit, take the cake for the worst purchases and money mistakes I’ve made for sure!
Enoch from Savvy New Canadians
One of my regrettable financial decisions was believing that I could find the ‘Holy Grail’ of stock trading and make it to millionaire status overnight.
I spent a fortune (based on my net worth at the time) attending trading seminars and ‘Traders University’ style training, attempting to learn how to day trade stocks, commodities, and currencies using technical analysis and various other techniques.
After nearly losing my shirt in my late twenties while trading the S&P 500 and Dow Jones e-mini futures, I finally came to understand the differences between ‘gambling’ and ‘investing.’ These days, I keep my investments simple using low-cost index funds and ETFs. Now, I also tend to my portfolio with a long-term mindset.
Jon from Compounding Pennies
My biggest financial mistake was buying a second car as my bike rack. I had a small sports car and my mountain bike didn’t fit in it. I refused to buy a bike rack for fear I would scratch the paint. So I dropped $5K on a used car so I could mountain bike. Adding in repairs, insurance, gas, etc. I spent close to $10K when I could have simply spent $300 on a great bike rack.
Ashley Patrick from Budgets Made Easy
The biggest financial mistake I ever made was taking out a 401(k) loan. That loan ended up costing us almost $1 million dollars! We took out the based off of bad advice. My husband then lost his job shortly after. We were unable to pay it back within 60 days and it counted as a withdraw. It cost us almost $10,000 just in taxes. Since we were so young when we took out the loan, we lost almost $1,000,000 in compound interest at retirement age.
Bryan from Bucks and Cents
Probably the biggest financial mistake I made was that I stopped contributing to my retirement at a young age. I had a money makeover done by a financial planner and the results were published in a major metro newspaper. The results were that if I contributed the max into my retirement, I would have $1.1M at age 46, $2.6M at age 55, $7.0M at age 70, and a whopping $23.0M at age age 80.
Anna Bee from The Land of Milk and Money
Analysis paralysis caused what is easily the biggest financial mistake I’ve ever made – and a costly one, at that! After all, I’d managed to master the whole concept of saving a significant portion of my income, but was so scared of taking the next step and investing what I’d saved that I just left it sitting in a 0% interest account for several years. Unfortunately for me, my fear of “doing the wrong thing” easily cost me tens of thousands of dollars in investment returns and compound interest over my life. That’s not to say that you shouldn’t do research into where you put your money – but getting started based on an informed decision is absolutely an important step that I should have taken years earlier!
Leigh Louey-Gung from Life Operating System
Not checking the financials of the company I was merging with before negotiating terms. The owner was my business partner’s best friend and we both thought he was trust worthy. It turns out he wasn’t and it cost us 6-figures. I will definitely never make that mistake again.
Sayan Neogie from Prosmartrepreneur
My biggest mistake was to continue my college education in engineering even though I was making a full-time income from my blog. It was not only a waste of money but it also halted my blogging growth. I had to take care of my college stuff so much that I sometimes barely had time to focus on my blog. If I would have just dropped out it would’ve saved me a ton of cash (since I lost interest in engineering anyway) but I could have focused that time and energy on my business and would have made my Income grow a lot quicker.
Jarek from Time in the Market
My biggest money mistake is not taking charge of my career earlier. I sat in a boring job for years with limited increases because I wasn’t driven and missed out on the potential for something exciting and much bigger salary increases. It’s important to take advantage of your early years and try to get as many big increases as possible to really maximize your salary by 30. I eventually got around to getting some promotions and moving into a managerial path that kick started my earnings but my first few years were a missed opportunity that could have put me at a better pay grade right now. If I had to do it again, I’d probably jump ship faster and get my pay growing in the early years as I was definitely underpaid back then and didn’t take any steps to fix it!
Kathryn Mancewicz from Money and Mountains
My biggest financial mistake was not starting a Health Savings Account (HSA). When you’re young, an HSA is easy to put on the back burner. You think you won’t need it for years. But you never know when unexpected medical expenses could come up. I just had to shell out a good chunk of change for some medical bills, and it sure would have been nice to have had that money coming from a tax free savings account. Live and learn. I plan to open up my HSA as soon as possible and start contributing so that if I have a need for medical expenses in the future (which is bound to happen sooner or later), I’ll have some set aside already.
Jacqueline Gilchrist from Mom Money Map
My biggest financial mistake was thinking that the only way to build wealth is getting a better paid full-time job. While this works for some, I should have focused on building multiple income streams that are more passive like rental income and stock dividends from the beginning. This would have significantly accelerated my net worth and options.
Marissa Sanders from Simple Money Mom
My biggest financial mistake was letting my husband take out his 401(k) when he switched jobs. He was working at this job for more than 3 years and then decided to apply somewhere else. The new place had a pension so he felt he didn’t need to 401(k) and didn’t know/believe/want to roll it over into a Roth. I tried for months to get him to make the switch but he was convinced he needed the money for something else, like his credit card debt.
He is over 30 years old and has zero dollars in and 401(k), Roth, or IRA. He literally started saving for his retirement from scratch with a pension at 32 years old. Not only did we inflate our income and pay more in taxes, we didn’t get the full amount of the 401(k) due to early withdrawal penalties. He knew this. Looking back, I wish I would have pushed harder to convince him that it wasn’t a good idea. Despite my financial education efforts, his decision was made. I did tell him from now on to leave his retirement alone.
Gary Weiner from Super Saving Tips
My biggest financial mistake was when I invested a large sum of money into my former brother-in-law’s so-called sports business venture. It turned into an actual con complete with fake stock certificates, phony office setup, and an eventual arrest and conviction for fraudlent activities. Two years later and $10,000 never to be seen again. I learned when something is too good to be true, it usually is.
Sara from Gathering Dreams
My biggest financial mistake was to wait to invest until I was in my 30s. I’ve always thought of investing as gambling. It wasn’t until I learned more about it that I understood how many years of compounding interests I lost! Investing in index funds is very different from picking individual stocks. It’s not as risky as you are investing in the whole market for the future, not for short-term gains. I wish I educated myself on how to make the most of my money sooner.
Carey Zielke from Realities and Dreams
My biggest financial mistake was trying the stock market. I read a few things on the internet and thought I knew everything and was going to make soooo much money!! I opened a brokerage account, dumped 15 thousand dollars in it. Only a few months later I had lost it all! I plan on trying the market again someday after I educate myself a great deal more!
Jeremy Ong from HUSTLR
Not investing the right way early enough. I always thought of investments as an exciting endeavour when I was younger, which made me pursue more risk than I should have. I didn’t have a plan, just cash (my parents helped me save up a small fund when i was little) and foolish bravado.
I lost 90% of that money in a heartbeat because I confused trading and investing. Thankfully, I’ve learned my lesson and I diversify my investments in asset classes that I understand but have no time to do research on. No more stock picking until I have the time.
Francesca from From Pennies to Pounds
My biggest financial mistake was marrying the wrong person. Now, I am definitely on the side of not depending on someone else for money, but when I had my daughter quite young, I kinda assumed that my now ex-husband would cover the money that I had lost due to being on maternity pay. I was wrong.
Cue the hardest years of my life, having no extra money for myself – and I really do mean nothing. So I guess my 2 mistakes were marrying the wrong guy, and assuming that I would receive help from my partner when I needed it. Money is a huge part of relationships, and my partner now wouldn’t hesitate to support me and do whatever he could, so I definitely think that the way your partner is with money is something important to look at – that’s not to say that people can’t change, but they have to want to.
Simon from Pennies for the Piggy Bank
There have been plenty over the years but in terms of impact on my long-term wealth, it has to be avoiding investing in the stock market for too long. I only started investing about 5 years ago as before that a combination of fear of short-term losses and lack of understanding of the true power of compounding meant I stuck all my money in cash at rubbish rates. I’d probably be financially independent now if I’d started in my mid-20’s rather than my mid-30’s, but you live and learn!
Rob and Heather from Empty Nestin’
Over the past 27 years, Rob and I have made our fair share of money mistakes. Our largest mistake was comparing ourselves to others. We allowed the financial shortcomings and missteps of others limit our potential savings rate. As long as we were doing better than so and so, we were happy.
Once we stopped comparing ourselves, and we began setting our own money goals, we were able to see the years of missed opportunities. The opportunities that were available to us over the years to save money and build wealth.
Riley Adams from Young and the Invested
When in college, I made the mistake of thinking too highly of my investing prowess. I Invested blindly in a company without a certain future on pure optimism which the market felt was undeserved. But this wasn’t my actual mistake. What I did wrongly was proceed to double down on my investment after the stock plummeted 95+% as a pure gamble.
I threw good money after bad and Fortune was kind to me. The stock rebounded significantly and I sold virtually break-even. However, that decision wasn’t investing, it was a pure gamble.
Amanda L. Grossman from Frugal Confessions
The biggest (and most annoying) financial mistake I’ve ever made was not getting in writing a conversation I had with my apartment leasing manager. I had been laid off from work, and needed to move to another state, but my lease was not up for 7 more months. So, I called my leasing manager and explained the situation to him. He said that if he could find another person to assume my contract, then I would be off the hook.
A month or so later, he called to say that he had found someone else to rent my apartment, and everything was good to go. Guess what happened next? The recession hit, employment in that area of Florida tanked, and I’m guessing they were sore for money. Because several months later, I got a collection notice from a collection agency claiming I owed them over $3,000 from my original lease agreement.
I now know that anything someone says that has to do with money, promises, and an agreement needs to be put into writing.
Brittney from Millennial Twist
I always thought personal finance was scary and weird so I let someone else (significant other) take care of my finances for me (my biggest financial mistake). That resulted in me waiting YEARS to invest, and other terrible decisions like taking a loan out from my 401(k), not saving up an emergency fund, and paying the minimums on my credit cards (don’t judge me too much).
R.J. Weiss from The Ways to Wealth
My biggest money mistake was buying a home before I knew what I really wanted out of a home. My wife and I bought our first home at the age of 24. At the time, we thought that was the right thing to do, as prices were fairly low. However, after moving in we began to realize we made a mistake. We missed living close to fiends and family. Two years after buying we sold for less than we had paid for the home, losing our down payment and then some.
Tom Blake from This Online World
The greatest money mistake I made was to not use a cashback credit card during college and my early 20s. I’ve never had a problem with overspending on my credit card and have been pretty frugal throughout school and my first job, so not earning cashback has left a lot of money on the table.
Additionally, I’ve also put many business related expenses on my personal credit card during various internships or jobs (which were reimbursed later on), so this was another missed opportunity for some free money. I highly recommend that young adults learn how to effectively budget and spend with a credit card and then take advantage of the best cashback card they can find!
Ryan J from Arrest Your Debt
My biggest money mistake was letting my emotions control my spending. When I first obtained my career, I was making more money than I ever had and I felt I needed to buy a house right a way. The year was 2004 right before the housing market crashed. Due to the high home prices, I decided to purchase a condo at the top of my pre-approval with a 5 year adjustable rate mortgage. Long story short, I couldn’t afford the mortgage after the 5 years and had to foreclose.
Mr. Poor Swiss from The Poor Swiss
My biggest investing mistake was to sell too early because I was afraid of loosing. I started investing early, around 20 years old. However, I sold out very early, after only a few months once one my fund started losing about 10%. I made about 1% profit on this early investing. But had I held to these funds and continued investing, I would have made $50,000USD by now!
Sara Mitchell from Budget and Bliss
My biggest financial mistake was buying a brand new travel trailer and not researching the manufacturer before hand. We had major issues with the craftsmanship of travel trailer that resulted in thousands of dollars of damage to the roof. We tried to work with the company but unfortunately they are known for not backing their products. We lost a lot of time and money because we didn’t do our research before making a major purchase.
Nathan Clarke from Millionaire Dojo
My biggest mistake was not building credit before buying our house. My credit score was in the low 600s when we got our mortgage. If it had been in the 700s, we would have been able to get a considerably lower interest rate and that would have saved us tens of thousands of dollars over the lifetime of our loan.
Rand Shoaf from Well Traveled Mile
Being gun shy to take bigger investment risks at a young age. It took almost 4 years of searching for the perfect deal before investing in real estate. During this time I missed out on some great opportunities.
Forrest Webber from ForrestWebber.com
Investing $650,000+ into 7 websites in just under 10 months was probably the BIGGEST money mistake I’ve ever made. One or two great blogs are more profitable, meaningful, and manageable than 7 websites that spread you thin (AND make less money).
Lisa Hebert from Money Minded Mom
My biggest financial mistake was not saving a large enough emergency fund before paying off debt. I was so focused on getting out of debt and threw every penny I could at it. About three months after paying off our mortgage and final debt, our septic system failed. I didn’t have the $10,000 needed to replace it so I ended up having to take out a personal loan to pay for it. It was totally discouraging to have to take on more debt after working so hard to get rid of it.
Cyrus Vanover from Frugal Budgeter
When I was in my mid-twenties I got into stock trading pretty heavily. I read books on trading for a living and even paid $1,000 (not counting air fare and lodging) to attend a weekend conference by a stock trading guru. At first I had some winning trades, and I thought I was going to trade stocks for a living.
Thinking all of this stock trading stuff was easy, I put about $20,000 (a large chunk of my life savings at the time) into one particular stock I had been monitoring that was spiking up and down. I caught it on the down swing and went all in, and then nothing happened. The stock didn’t go up again.
Turns out, one guy had been engaging in an illegal “pump and dump” scheme that was causing the stock price to fluctuate wildly. He went to prison for his crime — and I ended up losing the $20,000 I invested. That was a tough lesson to learn. I haven’t traded one single stock since then..
Jerry Brown from Peerless Money Mentor
The biggest financial mistake I ever made was purchasing a brand new Nissan Altima in 2012. At the time, I was only making around $22,000 annually and the car was $23,000. As a result, I had no leverage at my job. I wanted to leave, but I trapped myself with this $400 a month car payment.
If I rewind the hands of time, I would have purchased a used car instead and contributed the difference to my credit cards or student loans. I’d be in a much better financial position if I didn’t make this dumb financial mistake.
Jay from Dope Dollar
A big financial mistake I made was going to College because I was told “that is what you’re supposed to do”. I ended up taking many courses I had no interest in and wasted a lot of money on tuition and books. Looking back, I would have taken time to really understand what I want to do with my life instead of jumping right into secondary school.
GP from Entirely Money
My biggest financial mistake was buying a house in 2005 as prices were skyrocketing. I was 24 years old and thought if I didn’t buy a house right now, that I would never be able to afford to buy one with how fast prices were rising.
Fast forward a couple of years, and the housing market crashed in the Great Recession. I watched as my house dropped in value by over 40%. Instead of benefiting from continued home price appreciation, I ended up with negative equity in the house and a negative personal net worth that took years to dig out from.
It’s now 14 years later, and that house is now finally worth about the amount I paid for it way back in 2005.
We finance bloggers are just people. We’ve all made mistakes, some of them huge! What makes a successful financial life is being able to recognize those mistakes for what they are, correct course and move on.
I’m sure that most of these bloggers have recovered from their mistakes and taken the lessons to heart.
Question for you:
What has been your biggest money mistake? If you’re willing to share, let us know in the comments below!