_____

I am the sort of person who learns best by doing, messing up, and doing differently. My first car purchase taught me not to accept dealer financing. My first apartment taught me not to fall in love with a place so much that you ignore all of the drawbacks (I lived there for 4 years, and even by the end couldn’t remember that running the toaster and the dryer at the same time would blow the fuses). My first time making Chicken & Stars taught me that you’re supposed to add water to soups marked “condensed.”

So when Brian asked me to write a Friday Financial Foul Up, I answered honestly, “I don’t make mistakes.” I just learn.

Most of my lessons come with minimal consequences. I probably paid a few hundred dollars extra in interest on the car loan before I wised up and refinanced through my credit union. I loved my apartment, and since my now-husband moved in shortly after I did, the only additional costs were a few extra calls to the landlord or running to the garage to reset the fuses. Adding water to the soup after the fact worked just as well as adding it in the beginning.

There is one mistake, however, that still bothers me, mostly because I’ve never gotten around to correcting it.

The Situation

I opened my IRA in 2007 under pressure from my father, from every financial website I read, and from my boss. The only problem was that I had no idea how to invest. Target retirement funds weren’t widely available, and Robert Kiyosaki had written an article about how mutual fund fees would eat up all of your returns.

Where I Fouled Up

Luckily, I had a subscription to Money Magazine! And they had an article on The Best Stocks To Buy NOW! Inexplicably, I decided to pick one company from this list and buy a few shares of their stock. To this day, I’m not sure why I thought that was a good idea. The company was General Electric, and if I’m not sure why I only picked one company, I’m 63857 times less sure why I chose GE. I’ve harbored a dislike of GE ever since they didn’t offer me a job in 2005.

I bought 50 shares at $36.89, for a total of $1844.50, on February 28, 2007. Today they are worth $18.30 per share, for a total of $915. That means I’ve lost $920.50, at least on paper. That’s over 50%! What’s worse is that I’m still holding onto those shares for all the stupid emotional reasons people always hold onto losing stocks. This mistake could even end up costing me more, and yet I feel powerless to extricate myself from the situation.

What I Learned

It sounds so simple now, but even the finance “experts” can’t predict the future. Blindly accepting recommendations from anyone without doing your own research will probably leave you shaking your fist in impotent rage at Money Magazine every time you check your account balance.

At the very least, I can satisfy myself knowing that GE is still down from their 2005 value, while my current company is up by $10 in the same period. People might argue that hiring one person couldn’t affect stock prices that much, but I know better.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #26 – Brian (My Next Buck) – Final Four Weekend
Foul Up #25 – Peter (Bible Money Matters) – Being Ignorant of Your Finances Means Money Lost
Foul Up #24 – Daniel (Sweating the Big Stuff) – Paying for Value
Foul Up #23 – Kristin (Instigationology) – Giant Elves and the $86 Movie I Never Finished
Foul Up #22 – Kyle (Suburban Dollar) – Being Down on High Interest Checking Accounts
Foul Up #21 – Brian (My Next Buck) – Pale Dude’s Shouldn’t Go Tanning
Foul Up #20 – Shawanda (You Have More Than You Think) – How Financial Knowledge Can Hurt
Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

Not only did I go to the school, but I worked for the Men’s Basketball program when they made it to their first Sweet 16 back in 2003. Their current coach was the third assistant at the time and was my boss.

The Situation

Well, obviously Butler is playing this weekend just 5 miles from where I went to undergrad. I have lots of friends still there and have plenty of people to crash with if I were to decide to go to the games this weekend.

Where I Fouled Up

I fouled up this weekend because I an NOT going. Part of this is because of the expense and the other part is because of the new job and the uncertainty surrounding when I would be coming home (pending a win on Saturday night for the Bulldogs).

Both of these reasons make sense. Afterall, between flights and tickets, it would probably end up being a $2500 weekend. That is certainly a lot. Especially because i would likely miss work on Monday, which wouldn’t be good for the projects I am working on nor for me finanacially as I would sacrifice income (one of the negatives of being hourly).

What I Learned

Obviously I didn’t learn jack from this post because I am not going this weekend.

How about you sports fans?  Am I missing out on something huge even though I could afford it and probably swindle the day off?  What would you do in my shoes?

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #25 – Peter (Bible Money Matters) – Being Ignorant of Your Finances Means Money Lost
Foul Up #24 – Daniel (Sweating the Big Stuff) – Paying for Value
Foul Up #23 – Kristin (Instigationology) – Giant Elves and the $86 Movie I Never Finished
Foul Up #22 – Kyle (Suburban Dollar) – Being Down on High Interest Checking Accounts
Foul Up #21 – Brian (My Next Buck) – Pale Dude’s Shouldn’t Go Tanning
Foul Up #20 – Shawanda (You Have More Than You Think) – How Financial Knowledge Can Hurt
Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

_________

Like a lot of other personal finance bloggers, I haven’t always been as engaged with my finances as I am now. When I was younger as long as I didn’t put my account into the negative, I thought I was doing pretty well. I wasn’t really getting ahead, I was just treading water. I didn’t question where the money was going, or try to find better deals, I just paid what I was told and didn’t question it. Today, I want to talk about one of my biggest financial foul-ups, not paying close enough attention to my finances and not trying too find a better deal, especially when it came to my regularly occurring expenses.

The Situation

When I bought my first car when I was in college I didn’t really understood how insurance worked. I didn’t know how to find a good deal when it came to insurance. I asked my father what to do, and he referred me to his insurance agent. My dad’s agent worked for an insurance company that dealt almost exclusively with teachers, and as a teacher my dad was getting a pretty good rate. At the time since I was buying the insurance through my dad, I assumed I was getting a pretty good rate as well since I really wasn’t paying that much for my old car.

Where I Fouled Up

Where I fouled up is that instead of actually verifying that I was getting a good deal on my insurance, I just assumed that I was getting a good rate, and continued paying inflated car insurance rates.

Once I left home, I bought a newer car, and insured that car through my dad’s agent as well. When my wife and I were married we insured her car through the same agent. What I didn’t realize through all of this was that we were grossly overpaying for our car insurance. Since I was no longer insured through my dad, I wasn’t getting the teacher’s discounted rate, and of course the agent wasn’t about to tell me this if I didn’t ask.

Finally one day a few years ago I was stuck at home after dropping my car off to get repaired, and I decided to make the day productive, and to look into my insurance rates for homeowners and auto insurance. I started sending in requests for quotes to get insurance on my family’s cars, and the numbers I started receiving were shocking. If I were to move to another company I would save over $1000 a year on our auto insurance, and still get better coverage!

When I started looking at our homeowner’s policy I found the same thing. We could save $150-200 a year by moving to another provider. In all by switching companies that day I was able to save over $1200/year on our insurance dues!

What I Learned

I learned a hard lesson that day when it comes to being indifferent or ignorant of your finances. The lesson? Don’t always trust your insurance agent (or other service provider) and assume they’re looking out for your best interests, because they may not be. Don’t always assume that you’ve got the best rate on your insurance, or other regular bill. Take the time to educate yourself and search for a better deal. If you don’t, you may end up paying more than you should have, like I did. You could be missing out on thousands upon thousands of dollars that you could have saved, invested or given to others.

Have you ever overpaid for insurance, a service or something else and only realize it later? Tell us about your experience in the comments!
———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #24 – Daniel (Sweating the Big Stuff) – Paying for Value
Foul Up #23 – Kristin (Instigationology) – Giant Elves and the $86 Movie I Never Finished
Foul Up #22 – Kyle (Suburban Dollar) – Being Down on High Interest Checking Accounts
Foul Up #21 – Brian (My Next Buck) – Pale Dude’s Shouldn’t Go Tanning
Foul Up #20 – Shawanda (You Have More Than You Think) – How Financial Knowledge Can Hurt
Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

_________

I used to hate confrontation. Like really hate confrontation. I would do anything to avoid it. I chalked it up to not caring enough but really I just didn’t want to have to deal with it and for a few dollars, it wasn’t worth the risk of embarrassment.

The Situation

When trying to buy a tv in college, I went on Craigslist with a very small goal: Get the largest tv for the lowest price. I figured there wasn’t much else to it. I wasn’t interested in spending a lot of money, and I wanted to do it as quickly as possible. It was baseball season, and every day that passed meant another day without watching baseball, and that was simply unacceptable.

Without a car, I was limited to a very small proximity. I could probably get a ride anywhere in town from a friend, but I didn’t want to ask for any large favors, so my options were very limited. Still, there were a few options, most above my price range. But there was one tv that peaked my interest: a 32 inch that was within a 4 minute drive. It was perfect, I called up and quickly got over there.

Where I Fouled Up

I checked out the tv, which was a little fuzzy and for $100, didn’t seem worth it. But I was already there, I had never bargained before, and I wanted a tv but didn’t know what my other options were.

Needless to say, I had the tv for 3 years and hated every minute of it because I couldn’t tell the difference between a 6, and 8, or a 9, and clear as HD is with my direct tv hd receivers, this was blurry. I probably hurt my eyes squinting, and with no place for a dvd place or xbox 360, it was basically worthless.

What I Learned

I learned two important lessons that day. The first was to always bargain. No matter what, it’s worth the potential embarassment to save money. I now bargain constantly and never let a purchase go by without haggling and at the very least asking for a better price.

The other, more important lesson that I learned is that I should pay for quality. $100 may have seemed like a bit of money as sophomore in college especially when you are broke and often needing a cash advance, but there’s nothing worse than being out $100 with little to show for it. For another $50, I could have gotten a significant upgrade and been able to watch while relaxing on the couch. I could have been proud of my entertainment system instead of having to stand inches from the screen. Since then, I’ve made a conscious effort to avoid possibly horrendous purchases and spend money on the things I feel are worth it.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #23 – Kristin (Instigationology) – Giant Elves and the $86 Movie I Never Finished
Foul Up #22 – Kyle (Suburban Dollar) – Being Down on High Interest Checking Accounts
Foul Up #21 – Brian (My Next Buck) – Pale Dude’s Shouldn’t Go Tanning
Foul Up #20 – Shawanda (You Have More Than You Think) – How Financial Knowledge Can Hurt
Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Mrs. Micah – Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

Need cash for the holidays? Christmas Payday Loans from CashAdvancer.com can get you cash immediately to enjoy your holidays.

Friday Financial Foul Ups has been nominated for a Plutus Award. Please go here and give it a vote for Best Multi-Part Series.  If you would like to add your own financial foul up to this series, please contact me here.

_________

The Situation

So, I was dating this guy (and really, shouldn’t all juicy financial foul ups start this way?), and this guy, he was a decent sized fellow (this is not relevant to the story other than to set the contrast to my rather elfish frame as a basis for understanding why on earth a lady of my …insert whatever attributes you see me as having here… would be intimidated).

Back to the guy: His evening plan involved watching the much touted (at the time) documentary Murderball, which was so touted that it wasn’t even available at the local Blockbuster and said Giant and I headed to the Sure to Have Whatever Random Indie or Foreign Flick Your Heart Desires for Only 99¢ video rental place.

Where I Fouled Up

The point of the story: my oh-so-cute-and-bashful college self went along and signed up for an account at that 99¢ video store and rented Murderball. Which later got lost in my car. Maybe after I hated the movie just a little bit and hated being intimidated into doing pretty much anything just a little bit more and maybe after dumping the giant in an email while he was in Peru with his family because, well, because he was still bigger than me. And I’m oh-so-cute-and-bashful, remember?

So, Murderball is sitting somewhere hidden in my car, maybe intentionally, and I’m thinking ‘I’ll bring it by the store tomorrow, or tomorrow, or maybe tomorrow.’ And this goes on for, oh… maybe a year? And by now I’m just intimidated by late fees that likely match my now ex in stature, so I think ‘It’s a little video store. They never called. It probably just went under the radar…’

Fast forward 3 years: (yeah, this came back to bite me that much later) and I’m dating a new guy who’s not so big but just the right size and we’re running around like a couple of crazies talking about destroying our relationship by moving in together and we walk into the apartment of our We Totally Have to Have Separate Rooms and You Know What? Two Floors is Good, We’ll Never Not Kill Each Other Otherwise, Oh! And Separate Bathrooms Because Boys Smell dreams and the application process begins (totally complete with dressing up like the children of well to do upper class parents who would totally support us if our independent businesses fail, just in case, because we’re definitely the youngest people in the neighborhood).

And we’re approved! Sort of. He is. I’m not. Because there’s kind of this little thing on my credit report that I have to take care of first. And I’m thinking, ‘WHAT?’ and rocking back and forth to calm down the giant purple she-hulk that is about to burst out of my frilly little summer dress that I picked out just for this interview.

Back at the safety of our computers: I’m frantically filling out the never ending security questions to get a copy of my credit report in hand and there it is, someone has sent a collection agency after me.

Back up: I come from a financial background of a child of reasonable middle class parents who are so awesome they would offer to sacrifice their discretionary income to support me if my independent business fails and not make me feel guilty about it. (Mostly, anyway.) So I did a whole lot of worrying about money but not really a whole lot of thinking about money.

So wait: Collection agencies are a real thing? Ok, I’m not stupid (though I do think anytime you have to claim you’re not something you should probably second guess that claim), but really? And I owe them $86? And yesterday I only owed them $65? This is not good. What am I going to owe them tomorrow? My first born? I just want an apartment with my own little corner to write my ridiculous blog posts from in peace.

So I call: They’ve been chasing me for years but haven’t been able to find me because I move like a cheetah (or like a noncommittal recent college graduate who doesn’t sign leases but jumps from open room to open room – regardless I actually have a moment of feeling like a criminal badass here). And they’ve been hired by some independently owned video store about a missing DVD… (you saw where this is going, right?)

And what can I do? My credit is now iffy, it might take weeks to get that off my record, and I’m out $86. (And we have to go back to that interview and I don’t have another cute summer dress.)

Well, I’ll tell you. I paid it. Out of pocket. No, my awesome parents didn’t help out. I’m actually pretty big on owning up to my own mistakes and paying for them myself. The perfectly sized boy didn’t leave me because my credit was marred (this was actually a concern of mine for about an hour). And we got that apartment and somehow perfectly sized boy talked me into giving up my separate room for a mutual office out of practicality and that practicality had us oh-so-lovingly at each other’s throats for about a year, but now he’s on the other side of the world and we’re totally besties again. But none of that is really relevant to the story.

What I Learned

Oh, but wasn’t it a lot!

1. Don’t date Giants. Unless they’re BFGs. In which case, call me Sophie and it’s on! (Too obscure?)
2. Return your movies. If you still rent. In which case, what planet are you on and just get Netflix already!
3. CHECK YOUR CREDIT REPORT EVERY YEAR! This was far from the most embarrassing moment of my life (give me a couple glasses of vino and I have got some stories for you!) but it certainly wasn’t fun and I certainly wouldn’t want to go through it again.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #22 – Kyle (Suburban Dollar) – Being Down on High Interest Checking Accounts
Foul Up #21 – Brian (My Next Buck) – Pale Dude’s Shouldn’t Go Tanning
Foul Up #20 – Shawanda (You Have More Than You Think) – How Financial Knowledge Can Hurt
Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Mrs. Micah – Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

If you would like to add your own financial foul up to this series, please contact me here.
_________

When I started Suburban Dollar a little over a year ago it was at the end of what many people would call Online Savings Account boom. Interest rates were in the mid 3′s down from their epic highs of around 5% APY. Online saving wasn’t new but it was gaining in popularity and people were flocking to it in droves, driven by banks like ING Direct and Emigrant Direct. The populatity wasn’t limited to savings accounts either, banks had started offering interest bearing online checking accounts. I wanted in on the action.

The Situation

At some point in the last year my wife and I decided enough was enough and we needed to part ways. We both wanted to be able to spend, a little, money without having to feel like the other was judging their spending. We agreed to a set allowance amount and that we would have separate spending accounts for ourselves and joint account for bills, household stuff, and that kind of junk. My wife decided to use a bank account that was setup for us when we got our second mortgage, I was left to my own decisions.

Where I Fouled up

Making your money make money is a key piece of the personal finance puzzle. Stagnant cash is worthless, if you aren’t using it then you need to use it. That was the only thing on my mind when it came time to open up a checking account. I scoured the interwebs looking for the best rates I could find on an online checking account. It turned out one of my online savings banks had a good rate for their checking product and I jumped at it. I made sure there were ATM’s in my area, they were a little out of the way but I was sure I wouldn’t mind. Everything was set and I was ready to roll, they took direct deposits and after finagling with my payroll department I got set to enjoy my personal checking account freedom. The problems started almost immediately, my first direct deposit went in and my online interface showed I had $200 current and $200 available balance. I patted myself on the back and hit the store, well cafe for lunch but still. I ate my lunch and ran my card, the world was good, or so I thought. The next day I went in to check my balance and found not only had my available balance decreased but it had gone to -$27, WTF. The bank holds ALL deposits for 3 days even payroll direct deposits. I overdrew the account because of the hold and got hit with an NSF fee. They eventually waived the fee but it left a bad taste in my mouth. When I opened the account I made sure there were ATM’s in my area that weren’t super far away. I verified there was an ATM at a grocery store less than 1 mile away so I thought it would be good. Man was I ever wrong. I didn’t take into account 2 major problems.

1. The ATM in question is fortressed behind ~8 red lights, a parking lot, and grocery store doors. It takes 30+ minutes round trip to get to that thing.
2. The main thing I use cash for is to get out of the parking garage at work, there wasn’t any ATM’s convienent to work so I was constantly getting money out of a non network ATM.

What I Learned

I learned that it pays to know as much as you can about a bank account before you jump in. I went in with my eyes closed and it cost me. You would be surprised at how quickly ATM fees negate any potential benefit of an interest bearing checking account. In the year that I have had the account I have spent $38.50 on ATM fees and made a whopping $1.84 in interest. You slap those two numbers up against each other and you get earnings of -$36.66. I don’t know about you guys but that seems like a pretty bum deal to me. I have been with the same bank since I was a teenager. I watched it get bought out 3 times and they have been solid to me through and through. There is no reason for me to be crazy and get an online checking account when I could have gotten an account with my local bank which would cost me less in fees and hassle. Interest isn’t always the biggest decision you need to make when deciding where to put your money.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #21 – Brian (My Next Buck) – Pale Dude’s Shouldn’t Go Tanning
Foul Up #20 – Shawanda (You Have More Than You Think) – How Financial Knowledge Can Hurt
Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Mrs. Micah – Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

If you would like to add your own financial foul up to this series, please contact me here.
_________

We all have our own insecurities. One of mine is that I will never be the tall, dark and handsome type. Tall, yeah. Handsome, of course! Dark, well I am just SOL there.

The Situation

In grad school I had some pretty interesting friends. One of them wouldn’t classify himself as metro, but yeah, he was. Anyway, during one of our poker games, the subject of tanning came up. I was intrigued, especially being the pale guy I was. I decided to give it a shot.

Where I Fouled Up

While my intentions were just to give tanning a try, I am sure all you ladies know that it’s a process that requires constant maintenance. I get into the location with a buddy and the smokin hot chick behind the counter started to explain all the packages that were available to new clients. I settled on the best value. It was something like 80 minutes for $100 or something like that.

The first time wasn’t bad. I didn’t burn myself and since I went in the middle of winter, it actually felt good to be surrounded by all that heat. I went the next week, and the week after that. I went from being pale white to just white!  Come the third or forth consecutive week I didn’t have time to get to the tanning spa. When I went to go back I looked at myself and I looked the same as how I had started. Pale.

I gave up and had like $50 worth of value at that location that went unused. I didn’t have time or the interest to go back. Life was too busy and unsuccessfully tanning myself wasn’t a priority.

What I Learned

I learned several things through this foul up. First off, there is no way around being pale. Gimmicks rarely work. Secondly, when you have to pay up front for something you aren’t sure of, think twice! Lastly, I learned that if you are going to ignore the two things I mentioned, for chrissakes pick a location that is super convenient so you have no excuse not to get the full value for your money.

P.S. For some fun viewing check out Pale is the New Tan.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #20 – Shawanda (You Have More Than You Think) – How Financial Knowledge Can Hurt
Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Mrs. Micah – Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

Need quick Cash? Instant online cash advances from MyPaydayLoanCash.com can get you cash asap!

If you would like to add your own financial foul up to this series, please contact me here.
_________

My first personal finance book was The Wall Street Journal Guide to Planning Your Financial Future. It was given to me as a high school graduation gift by one of my closest friends. I’ve been smitten with the subject matter ever since.

Now, I’m no expert, but I do know a thing or two about money.  As we all know, and so easily forget, knowing is only half the battle.

The Situation

When I began my professional career in August 2004, I was far more well equipped with financial wealth building information than your average 22 year old. I knew the value in diversification, passive income, tax deferment, and, most important, compound interest.

In order to comfortably retire, I figured I should invest at least 12% of my annual income. I didn’t arrive at that percentage as a result of some complicated, scientific calculation. David Bach, in his book Smart Women Finish Rich, said it was a good idea so I went with it.

When it comes to retirement planning, you won’t get very far in Money Management 101 without learning the hierarchy of proper cash allocation.

1. Invest in your 401(k) up to the maximum your employer will match. At the time, the company I worked for offered a pitiful 25% match on up to 6% of my salary. Although measly, it’s 3 times more than a reasonable return on a balanced portfolio.
2. If you qualify, max out a Roth IRA. You fund a Roth IRA with after-tax dollars so you don’t have to worry about paying inflated tax rates later when you’re, you know, rich. In 2010, the most you can contribute to an IRA is $5,000 if you’re under 50 years old and $6,000 if you’re 50 or older.
3. Max out your 401(k). Although there is such a thing as a Roth 401(k), many companies only offer the traditional version which is still good. Funding one adds tax diversification to your portfolio. Plus, you can contribute up to $16,500 in 2010 to a 401(k) if you’re under 50 years old and up to $22,000 if you’re 50 or older.

If at any point during this three step process I hit 12% of my annual income, I stop investing.

That’s great stuff, right?

Where I Fouled Up

I knew exactly what to do. So, here’s what I did:

1. I invested 6% of my salary in my 401(k). Remember that’s the most my employer matched.
2. I didn’t save an additional dime and spent the money I should’ve invested in a Roth IRA on clothes, shoes, eating out, and other foolishness for two straight years.

Once the extra cash landed in my paycheck, all that financial prowess went out the window. Besides laziness and lack of self control, I really can’t think of any other reasons I only contributed 50% of what I originally planned to my retirement accounts. I know opening an IRA is really easy. It’s still fresh in my memory, because I just opened my first Roth IRA last month, in January 2010.

If I knew then what I know now, I would’ve contributed the entire 12% to my 401(k). Maybe it’s not the best strategy, but it sure beats the one I implemented.

What I Learned

Even as a child, I understood the differences between knowing, saying, and doing. All that information didn’t stop me from sitting on my butt and not doing what I knew I should’ve done.

At this point in my financial journey, I don’t even attempt to do what will yield me the greatest overall return. I simply focus on what I’m likely to do.

Recently, I realized I probably won’t get around to doing the proper research required to create an optimal investment portfolio anytime soon. Instead, I set aside a chunk of money and immediately invested it in low expense, commission-free, ETFs (Exchange Traded Funds) from Charles Schwab.

Surely I can do better, but you know what?

I’m not even gonna try.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #19 – Christine (Money Funk) – Love Can Hurt Your Financial Situation
Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Mrs. Micah – Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

If you would like to add your own financial foul up to this series, please contact me here.
_________

I was in my early 20s and in love. The boy and I got an apartment, we both studied pre-med at the same college, and we were having the time of our life. It all seemed like a fairy tale relationship.

The Situation

My boyfriend, the entrepreneur, also ran a bachelor party business. We lived the life of glitz; partying with friends, getting complimentary VIP status into clubs and movies, rode around in limousines. It was grand. We lived life as if we had endless money and status. Of course, “love” in my young adult life equated with “vulnerability”. Vulnerability meant I was living life with rose colored glasses on.

Where I Fouled Up

I was funding my pre-med schooling with government student loans. My school costs were low; I should have only borrowed what I needed to survive on. Instead I borrowed ALL that was available to me because the boy had me believing we needed it. As Whimpy would say, “I would gladly pay you Tuesday for a hamburger today”.

My financial part of the relationship started to spiral out of control. He talked me into paying for him to quit pre-med and transfer to a private vocational school to become a computer techie. The money started to be used for those lavish parties and new clothes. We bought new furniture and paid excess bills. Then the money ran out. And you know what? So did the boy.

In the end, I was left with a broken heart, an unfinished pre-med degree and $32,000 worth of student loans. To which, I am still paying to this day.

$32,000 @ 5.6% for 10 years = $348 payment/approx. $9,500 interest/payoff year 2020

Ouch!

What I Learned

Don’t let Love govern your financial decisions! If your gut tells you it is not right, believe it!  I was unfortunate to fall for false sweet nothings and promises of future riches. But I learned a great lesson from this experience.

I learned that as a woman, it is vital to build my own financial foundation.  That meant building a savings account of my own, establishing good credit in my name, and learning about other areas of personal finance. At this time, I might still be in a negative net worth, but because of the lessons learned from this experience I now have a plan in place to become financially sound. And I am okay with that.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #18 – Clayton (Just Good Financial Advice) – Trying to Get Rich Quick
Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Mrs. Micah – Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money

If you would like to add your own financial foul up to this series, please contact me here.
_________

I graduated from college in 2003, and like any other fresh graduate I was looking to make lots of money. The problem with that is that I wasn’t making enough at my current job so I was looking for work on the side. Sounds like a classic problem and plan right?

The Situation

Coming out of college and always looking for work and ways to make money I fell into a get rich quick scheme. I watched one of the “buy tax sale properties and make incredible returns” commercials.  I thought that if I could just make 10% of what those people were making then I would be much better off.  Heck, I was going to do this with my spare time so I wasn’t expecting incredible results.

Where I Fouled up

When I called to apply for the program, I had to sign up for other services as part of a package deal. They had me go apply for a credit card to afford the “mentoring” service that would come with it. I actually had planned on getting a second credit card anyways so I just thought I’d throw this into the lot with it. I had myself convinced that I would actually have to spend some money to make some money, and so I went through with ordering the complete package.

Their next step was to send me 5 emails and call me and tell me what was in those 5 emails and that was my mentoring.  The next thing they wanted was for me to pay them to set up an LLC. This is the point where I drew the line.  I wasn’t impressed with the mentoring and then they wanted to me to pay a bunch more for them to set up a business for me. I finally saw the light on them wanting me to keep spending money and cut them off.

By the end of this process I had purchased four properties and put myself in 5,000 dollars of debt with a bad plan to pay it all off.

What I Learned

I should have researched this company and everything they did before I purchased. Not being an informed consumer was my biggest mistake.

If I really had wanted to buy and sell properties, I should have taken real estate classes, which I’m glad to say I eventually did. I learned more and got so much more help than I ever did with the TV ad.

Finally, if it’s too good to be true, it probably is and that is twice as true when it comes to making tons of money and not doing any work.

———-

Do you like this series? Check Out The Previous Foul Ups:

Foul Up #17 – Craig (Budget Pulse) – Black Friday Purchase Becomes a Dust Collector
Foul Up #16 – Jesse (PF Firewall) – The Fine Print of Rental Properties
Foul Up #15 – Paul (Fiscal Geek) – Unsuccessfully Restoring American Muscle
Foul Up #14 – Mrs. Micah (Mrs. Micah – Finance For a Freelance Life) – How Getting Married Wrecked My Finances
Foul Up #13 – Evan (My Journey To Millions) – Speeding Up Payments on Loan Interest, Not Principal
Foul Up #12 – Elle (Couple Money) – Stretching Yourself to have a Comparable Car to Your Friends
Foul Up #11 – Revanche (A Gai Shan Life) – Sibling Bailouts Cost More than Just Money
Foul Up #10 – Brad (Enemy Of Debt) – There’s Nothing Interesting About Interest-Only Loans
Foul Up #9 – Jason (Redeeming Riches) – Buying a Car with a Balloon Payment at the End
Foul Up #8 – David (Money Under 30) – Being Too Eager to “Move Out” and “Move Up”
Foul Up #7 – Matt (Debt Free Adventure) – Upside Down and Paying The Price
Foul Up #6 – Brian (MyNextBuck) – Overdue Books Prevent Me From Renting an Apt
Foul Up #5 – Kelly Whalen (The Centsible Life) – Poorly Planned Vehicle Purchase Costs $24,000
Foul Up #4 – Stephanie (Poorer Than You) – Signed My Life Away at Age 17
Foul Up #3 – Deliver Away Debt – How I Wasted Over $10K and 11 Months
Foul Up #2 – Brian (MyNextBuck) – Quick Fixes to Weight Loss
Foul Up #1 – Brian (MyNextBuck) – How I Didn’t Earn $3000 in Free Money