Okay, a quick question for all you guys. What was your biggest financial blunder? What one thing did you do that has set you back the most financially? Try to be specific. (You can list more than one if you have them). Here are my top 3 dumbest financial moves. They are in order from least to most harmful. (I usually don’t do “polls” or reader-participation stuff, so, post a few comments so I don’t feel like a total dork).
1. Purchased a brand new car, right out of high school, when I had a perfectly good car paid for from my parents. Roughly 15000 dollars of unnecessary debt.
2. Went on a 4000 dollar vacation 2 years ago, right after promising that I would get out of debt. Put every dime on credit cards, and then used credit cards for every meal, every outfit, and every thing we did on vacation.
3. The big one. Purchased (in 1999) a 32000 dollar SUV, when we only made about 40000 dollars a year take-home pay. This ONE single purchase set us back many, many years. I was stupid to buy the SUV, I got a horrible trade for my old car, and I paid for unnecessary warranties. Plus, the guy who sold the car to me really, really did me wrong on the financing, etc. (I am NOT blaming him. I was totally ignorant about money, budgeting, and debt.)
Dave Ramsey uses the phrase “stupid tax”. These are three examples of how I have paid tons of “stupid tax”. Hope to hear from many of you.