Financial regrets happen to the best of us. But what we learn from them and how we proceed to move forward are what determines whether or not we will continue to make the same mistakes. But heck sometimes we end up making the same or similar mistake more than once. I know I have 🙂 Maybe we think that doing the same thing may produce different results or if we tweak something here and there, a mistake won’t occur. So I want to share a couple of instances and how I overcame those mistakes.
Regret Selling MSFT Years Ago at $30 Something a Share
This was back when I first started playing around with the stock market in my early 20s. I was so nervous and as soon as I saw some gain I was like that’s it I want out! So after I sold the position, I would periodically look up MSFT to see how it is doing. Of course it continued to rise along with my blood pressure, lol.
Lesson: I’m no longer interested in short-term gains and making a quick buck. I’m in it for the long-term baby. I want this investment relationship to last for better or worse, through ups and downs, in sickness and in health J These days the market is high and many of us are probably doing well if we purchased investments even a year ago. So what would make more sense is selling for the purposes of rebalancing in my opinion. Because the act of rebalancing itself suggests that an investor is in the market for the long-term by buying losers and selling winners to lock in gains and reset his investment objective(s). Oh and another lesson is to not check up on positions I’ve bought and sold so often as to doubt myself about whether I made the right decision or not. This was not the case when I bought MSFT because I was impatiently waiting for a small profit and then just decided to pull the trigger.
Regret Buying A Solar Company Stock – Still Have It
About 10 years ago, there was word in my friends and family of a particular solar company in China and that it was the best up and coming solar company to invest in. At that time, I was pretty new to investing and like many new investors wanted to turn a profit, FAST! So I invested a decent amount at that time into it. It went up a little bit, but we all thought it would at least double. Long story short, the company is now bankrupt and is trying to emerge from it. The stock is listed on the NYSE, but it’s pretty much at zero.
Lesson: Don’t let the latest trends influence your investment decisions. And don’t invest in in the unknown. For me, I’ve never been to China, I don’t really quite know how solar panels work, I don’t have solar panels on top of my house and I don’t know the difference from one solar company to the other in terms of competitive advantage, history, types of solar panels, etc. If you do this (that is, invest funds in the unknown based on the latest and greatest trends) you can win BIG or you can lose BIGGER. But in order to do this, you need to be quite the risk-taker. Just look at Tesla, I was tempted to invest in it back in the end of 2013 when it was trading around $140. But I didn’t because I didn’t know enough about the company. Yes I could have made a lot – more than double my investment, but part of me would not be able to sleep much at night due to the risk that I’ve invested in the unknown. Maybe a small portion of my work’s retirement fund is invested in it, I should check.
Regret Getting A Balcony Made That I Hardly Ever Use
Shortly after I bought my home back in 2010, I decided I would get a balcony off of my master bedroom. I remember seeing it in a magazine and thought wow, this is so cool and different and no one I know has it. I gotta have it! I envisioned enjoying coffee in the fall and winter mornings on the weekends and chilling with my wife with some lemonade on the evenings sometimes. So I went ahead and got it built. Fast forward to seven years later and we had breakfast on it ONE TIME ONLY. Actually we didn’t even eat the whole breakfast on the balcony because the sun was hitting our face, so we finished it on the floor of our bedroom 🙁 Hull Financial Planning says we should discuss financial losses with our loved ones. Although I didn’t need to in this case since my wife and I spoke several times about how much of a mistake this balcony was anyway. She uses this as an example whenever I propose a moderate house project.
Lesson: The lesson I learned from this mistake is this. I will not let a magazine or show on HGTV influence what I do to my home. I mean yes there will be some influence. But to mitigate this I will assess the pros and cons of implementing the same feature in my particular home. For example, if I want to get a patio made in the front or back of my home that project would cost a few grand. In order to justify the cost if the project I would need to assess the (1) upkeep/maintenance costs, (2) time I spend using it and somehow (3) quantify he amount of happiness if would provide to me and my family.
So would you like to share any financial regrets you may have made in the past? How did you learn from those regrets or mistakes?
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