Back when I lived a more financially challenging life, I used to find myself wondering how the so-called money experts lived their lives without making money mistakes. They always seemed to be have the right advice for every situation. How did they this get all of this knowledge? And more importantly, do they every make any money mistake?
Before I was the Broke Architect my life seemed to be a series of bad money decisions. Listed below are the worst money I have every made:
- #4 Having A Car Repossessed
- In my early twenties when I was a member of the Armed Services, I bought a brand new car. While I was in the military the payment seemed affordable. But I bought the car near the end of the time in the service and not long after being discharged I had to give up the vehicle. I not only ruined my credit, I also ruined the credit of my my co-signer.
- Lesson: Never trust anyone with your credit
- #3 Buying A Car From A “Buy Here Pay Here” Dealership
- I not only bought one car this way; I bought three of them from a buy here pay here dealership. At the time I had a very low credit score and it seemed like the only option I had. So, for years I would make weekly car payments on subpar vehicles. One of vehicles was so bad that I had to return it to the dealership several times for repairs. The dealer eventually became tired of fixing the same problem and took the car back. But, they did not return the months of payments I had made.
- Lesson: Do not pay excessive fees and cost for subpar items or any item for that matter. Many of these cars were bought at a auctions for pennies on the dollar and resold with a very high profit margin.
- #2Taking Money Out Of A 401K
- When I graduated from college I still owed the University around $4,000. They let me graduate, but they would not give a degree until my account was paid in full. This became a problem when I decided to obtain an architecture license. In addition to taking seven tests, you have to submit a copy of your college transcript and several letters of recommendation. Although I had a few years to save up and paydown the $4,000, I did not. I marched my happy ass into the accounting office and cleaned out my 401k. Taking out $4,000 from my 401k will cost me more than $45,000 over the course of my working career in lost interest.
- Lesson: Before you make any money decisions, think of the long term cost.
- #1 Trusting Others With Your Money
- While I was in the in the Armed Services every month I had money from my check placed into a bank account to save for a future. I gave a one family member access to the account because they said they wanted to manage the money for me. Who doesn’t trust a close family member? To make a long story short, when I was discharged from the military I when to check on the account and there was less that $100 in the account. Thousands of dollars missing from the account. Maybe if this money had not been stolen from me I would not have had to let my car get repossessed?
- Lesson: No one will care about your money more than you.
Remember, no one will care about your money more than you, not even your financial advisor.
The Broke Architect