Most everyone has made them, I am no exception. There are three big money mistakes that haunt my financial past. They could have been avoided, but I was too young and ignorant to know better. Please remember that.
The first money blunder was not spending, but savings related. We saved a bunch of money, but with only one purpose, to buy our home. This may not sound like a mistake, but it was. Saving for retirement or to have an emergency fund never crossed our minds. So when it came to our house fund we justified spending all of it and then some for our home. We did a lot of remodeling and furniture purchases. Our house obsession took over our financial planning. I figured that if this is what we saved it for, why not spend it on what we want. Owning your home is a great financial milestone, but it shouldn't be the only financial milestone.
The lesson learned:
Our finances should be well rounded; not centrally focused on one thing. There should be a savings for practically everything. Starting from little things like car repairs and clothing to the big things like emergency funds and retirement.
The last two financial missteps are somewhat related. It comes down to the sailor and I getting two equally decent sized inheritance checks, within six months of each other. Those checks really did come at a time when we really needed them, but that could be a whole other story in itself. Here is the short version: Just had twins. Didn't have a car that fit our whole family. Were making about $700 twice a month. Our rent was $675 a month. Had a couple thousand dollars in debt. It was not looking good any way you sliced it for us. Then came the first check. And then more mistakes.
We actually did not go hog wild with the money. We bought a used car and paid off our debt. We had a really nice Christmas that year and put a lot of money into savings. The mistake we made was not keeping track of our expenses. A budget was never set up, we kept using credit cards for things here and there. The money didn't disappear, but we could have made great steps toward a healthier financial life if we hadn't been so careless.
The lesson learned:
Track our expenses. Even if we have money in our savings account, that doesn't mean we aren't spending more than our monthly income.
About six months after the sailor received his inheritance check, I unexpectedly received one as well. It was only a couple hundred dollars less than the first one. At this time I was assisting my best friends mother at her travel agency. I was answering phones and booking flights. I wasn't getting paid, but I was helping out and having fun and getting out of the house. Remember, twins.
My friend's mother, we can call her Flinda, knew about the inheritance checks and came up with a proposition for the Sailor and I. She told us that if we invested x amount of money she would give us a little over a 16% return on our money in a month. I immediately thought yes, we should do this. It wasn't even about the money we would receive back. It was about how Flinda had basically been a mother figure to me for over six years. I was at their house on Thanksgiving and Christmas, cooking dinners and opening presents. Many nights were spent at her house, which had become a haven from my own home. My best friend, her daughter, had introduced me to my husband. I went on family vacations with this family, my family. Why wouldn't I do this? I trusted Flinda with everything I could.
When I told the sailor about the deal, I don't even think I got all the words out before he said no. I told him how he should come talk to Flinda and hear for himself. He was a good sport and came into the travel agency and listened to Flinda and her plan. He still was apprehensive and I had to talk him into it. Telling him how many times has Flinda helped us out. Do you really not trust her. He relented and agreed. So we wrote the check right then and there.
I should have kissed it goodbye first.
A month had past and though I spoke to Flinda frequently, but the money never came. After a couple months, the situation turned into I will send you checks every month for the next six months. During this time, I bought her lies and it never even occurred to me that we wouldn't get our money back. Like I said, I trusted her, she was part of our family. I never in a million years thought that she would intentionally screw us over.
Then came the day when I got a phone call from my dad. He asked if I had gotten the money back from Flinda. I told him I hadn't. I could tell something was very wrong. He then told me that Flinda had just been arrested. Of course, this goes into an even longer ridiculous story but in short we were cheated, to the tune of thirty thousand dollars.
The lessons learned:
Keep your mouth shut about your money.
I can't help thinking that if Flinda had never known about the money in the first place, this would never had happened.
Never give money you can't afford to lose.
That money could have been used for any number of things. Though it was gone, we really couldn't afford it. It was an incredibly stupid thing to do, even if I did trust Flinda implicitly.
Be in agreement with your spouse about all things financial.
The Sailor is a pretty awesome guy. He has never once blamed me for this whole mess, but in reality it is my fault. I should have never talked him into it. He didn't want to and I should have never pushed him.
We have definitely learned the hard way, but we have learned a lot. Of course, everything has worked out, even without the money. It just goes to show that it isn't all about how much you have in the bank. That money was taken from us more than eight years ago and we have moved on. At the time it felt like the end of the world. I had lost someone who I trusted and loved. And we had lost our future.
At least that is what it felt like, but we survived. And we still have a future. It's never too late to turn it around.