My biggest financial Mistake….
I have written a lot about my mistakes in the past, this post is about financial mistakes made by others! Most of the people were past their 60’s.
I asked a few people about their BIG financial mistakes and I heard the following:
1. NOT investing early: Almost everybody had a regret that they did not invest in their 20’s. However, to be fair ALMOST all of them had a big joint family to support and did not have much of a surplus.
2. MANY people had a regret that there were NO mutual funds to invest – or they would have started some kind of an investment earlier.
3. MOST of them wish they had known about the power of equities and compounding in school / college.
4. MOST of them HAD no regrets that they did not invest in equities, because they STILL do view it as a place for rich people playing with OTHER people’s money.
5. SPENDING too much money on things that they did not find of great value.
6. MANY of them who had not kept accounts ever had no clue about how their life would have been different if they had NOT frittered away money on things that they actually did.
7. STARTING to track expenses and investments too late.
8. FATHER / ELDER BROTHER not having ANY insurance putting TREMENDOUS pressure to earn money. This changed the career option for many – one person did ICWA (CA was a 3 year not paying anything course), one potential doctor became a Bcom, …
These were the major ones. The minor regrets were :
Supporting over demanding parents, helping siblings and friends who did not bother to return the money, none of them were regretful on the money spent on the kids education – that could also be because for people in their 60s and 70s the REAL expensive education was not really a choice….till about 10 years ago even IIMs used to cost only Rs. 2-3L, not Rs. 25 L the current cost.
WHAT DO YOU THINK ARE YOUR BIGGEST financial mistakes? Please list them here, not on the FB page 🙂
Narayan
My self 36 years old and redeemed all my my three mutual fund units for some expenditure two years ago. Now that expenditure looking funny to me as it can be avoided.
Feeling low.
sansvk
Everyone would relate to all of the above. The biggest mistake would be is to read subramoney.com and yet not start to save & invest for the future. I started investing in equities about 5 years back, trust me its really difficult to move away from FD’s and move to MF’s.
Anish
Hi Subra Sir,
My biggest regret is never saying no to anybody and lending money to every tom, dick and harry who asked for it. I kept on taking loans to support such rubbish people. Because of that my sons had to suffer so much. It was only because of my sons that I was able to come out of debt. But they sacrificed their life, their dreams, their hobbies for it. My youngest son had so much interest in dancing, cricket, travelliing (just as a hobby not career) and i couldnt fuflfill his wish, couldnt gave him money to join a good trainer/instructor. 🙁 God please let me make time travel once ..!!
Karthik
Today I met LIC Agent and He promised on camphor that ” New Jeevan Anand” is the best policy in India giving 10.5 % returns as IRR and LIC is THE best Insurance company. But he told that it will not be available in policy document. after my right questions and he replied that LIC means Trust, So you should believe. I got angry and replied that i earning money not getting from Lottery and I just left place.
God save educated Persons.
Tilak
My biggest regret was , In year 2001, had surplus money of 10 lakhs and lot of real estate were available to buy and thought who has time to maintain the land and thought will buy when I start building my home in my town and years passed by and by the time I realised in 2006 it is getting expensive, it was too late. Second one, 10 years ago, didn’t start investing when my daughter was born. third one, had money to pursue MBA but didn’t had the inclination to enhance my skills. I repent it very often for the missed opportunities.
Gourav
Hi Sir,
My mistake are as follow
1-Use/Misuse of credit card.Now I do not use any credit card.
2-Post paid connections(mobile,internet).Once I had to pay a big amount to
airtel
3-Buying ULIP fro tax saving.Was not aware of ELSS at that time.
4-Only focusing on increasing income and not on cutting expenses.
Regards
Gourav
Shankar
Hi Subra,
1) Direct stock:
My biggest mistake is investing directly in stocks based on tips from friends, on my relative’s company and some guess work. Earned profits but also lost , really don’t know which is more as I don’t want to record my losses.
I sold the profit ones when I need money but waiting on the red ones expecting it to come back to purchase price. It went deep red and realized this is basic mistake any new investors do without realizing that they are doing it. Then sold it one fine day thinking atleast I got back something.
2) Pre-paid bulk amount towards my already low interest home loan. At that time I even read your article discouraging it but I could not sleep with huge debt (as I got bonus money sitting in bank). So I pre-paid towards home loan as much as I can, now feeling bad that huge amount if I would have invested I could have earned huge profits.
I incurred direct / oppourtunity loss but feeling happy as the damage is not that bad and also I think I consider that as my tuition fees to learn that valuable lesson 🙂
satya
1. Invested all money in term FD for buying a shelf use flat.
2. Waiting for a long time to comedown the property prices and laterbuy in higher price for self use.
3. Not making a goal based investments
4. Paying hafty taxes on FD
Krish
Not getting into equity early and focussed on clearing all the debts including home loan. Worse, after clearing loans, fixated with FDs for 5 yrs and got only 6-7% net return. Even uglier, to have less tax on FD interest income, opted for Insurance for 80C.
Sold one of my flat on loss after 11 years. Did not bargain hard with the recent buy of one more property and lost 10% opportunity within a month.
Started building gold portfolio when it reached peak price 3-4 years ago and yet to see any gains.
Came close to buying two excellent stocks but ended up by buying two junk stocks in jiffy. It was not a mistake but blunder. Two excellent stock gave +50% return in one quarter but I had to sell my junk stocks at -50% loss in the same quarter.
What saved me was a great income, nearly 200% in 8 yrs and also an appreciated property whch I sold for 800% gain 10 yrs.
Nikhil
Hi,
Well I am 26, my financial mistakes so far are.
1. Focused on reading but not on actions : Have been reading financial blogs from almost 2 years, I had not acted on advises. Six months before selected 1 MF and started investing in it. After that nothing much active in investing.
2. Home interior : Spent some 30-40 thousand on home interior which i later regretted spending them as that was not at all necessary.
coolcurry
Investing “averagely” in mutual funds from 2004. All funds gaining little above average. Always did lumpsum investment in Mutual fund at bottom of market.( Not by market timing ,,,it was fluke as i just had bulk money at that time.) my MF distributor is a average guy but he gained knowledge by meeting lots of fund manager of hdfc,birla,icici,( he brings big business from eastern india).My biggestregret not having a demat acc till a couple of months back.
Did invest on good stocks at a little above market value …but will evaluate and monitor stocks..i prefer to call my self long term investor..I gained some basic stocks ideas in last 2 years.
Still learning…For your information i am 47 years,NRI worker( Dubai) for 13 years.
Mira D
In 1994, family pressure forced me to joint sign as gurantor for a cousin’s business loans with a jointly inherited property in Ahmedabad as the surety. Of course there was a distress sale. I lost my share of a property which at today’s prices would be easily 5 cr+.
For what it is worth, the astrologer had warned me of this!
Killez
I am 26 year old and got married recently. My mistakes/regrets
1. Purchased 2 LIC Jeevan Tarang Policies to save tax. Paying almost 50K per year for that. One of the policy completed 3 years, so now I stopped paying the premium for it.
2. Purchased a house thru loan as soon as I got a job, because of which I am facing difficulty in not trying out business or explore other options. Almost 55% of my monthly take away went as EMI. House was bought before marriage, so I did not take much into account the expenses I would be having after marriage.
These 2 mistakes put me in a crunch situation until my wife started working recently, but they taught me a lot in life and finance. I have started putting budget, tracking my expenses, investing in mutual funds thru SIP, purchasing only absolutely necessary things and follow finance blogs like Subramoney.
Abhijit
My mistakes.
1. Started saving (not investing) late and that too with Endowment and ULIP policies.
2. When attracted towards stock market, entered it as a trader and not as an investor which cost a considerable amount.
(Now I am into long term investing via Mutual Funds and Direct equities from last two years after 6 earning years were lost)