Confessions of a Personal Finance Reporter (Part Two): 3 Financial Mistakes

Sarah O’Brien works hard and writes about personal finance.

Salvatore Agostino

One of the best benefits of being a personal financial reporter is my keen ability to recognize many of the financial mistakes I’ve made in my life.

I have already revealed Few in the first iteration of this confession two years ago. While some of my blunders were worse than others, they all make me feel awkward — and the ones below will leave some readers in their faces. Others of you may contact you.

Either way, I hope sharing this stuff will help someone else avoid the same mistakes – which come with potential long-term consequences that aren’t particularly good. It’s hard to calculate the cost of my fluctuations over the course of my business tenth generation I have come of age, but suffice it to say that I would have more money if I made better decisions.

More personal finance:
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Here are the new income tax brackets for 2023

Here are just a few of the gems, in no particular order.

I tried to time the stock market because I “knew” where it’s headed

For at least two decades I was in adulthood when I decided I could see the future. That is, I just learned that the stock market was about to go down and will stay down for a while.

The crystal ball reading talent appeared when coins were rolled from an old woman 401(k) In my then current the retirement the account. I confidently put the replenished money into a money market account (it earns nearly 0%) so that I can buy shares during the impending market downturn, and thus be in a position to reap the gains when the market goes back up.

Avoid This Investment Mistake With Your Roth IRA

So, of course, stocks rose in the days and weeks that followed, as I waited for the big drop.

It did not come true.

I waited months. By the time I actually transferred the money to a stock-intensive target date fund — not because the market crashed, but because at that point I had developed a fear of missing out — the stock kept going up.

By keeping my money sidelined, I’ve missed out on those gains—plus any compound interest the money would have earned, both during those months I stayed in cash and into the future.

I asked for investment advice from a random coworker

The first time I signed up for a 401(k) plan as a young adult, I had only a basic understanding of investing.

That is, I knew that the stock market generally rose over time and it was a good place to put long-term savings, such as retirement. Details, though? Not much.

So when I had to choose from a bunch of money to guide me 401(k) contributions, I did some research: I asked a female co-worker near me which fund she would choose. shook her name. I told her it looks good, so that’s what I decided to use as well.

“Wait a moment,” she said. “I don’t want to be responsible for ruining your retirement if your investments go off.” She dismissed the idea with a wave of my hand and assured her that she was the smartest person I knew.

Now, this was long enough that I didn’t mention the fund’s performance or my account balance when I eventually transferred the money to another retirement account.

But here’s kind of the point: I had no idea what I invested in.

For all I know, the fund I chose was in “safe” investments (US Treasuries, cash) that may not keep pace with inflation and not provide the kind of long-term growth that stocks can achieve. I also didn’t know how much the fund would cost me each year of fees.

In other words, I had no idea if it was ever appropriate for my individual situation.

What could be this error in the house?

I participated in five home purchases as an adult. One is sold “as is”.

A friend of mine at the time said, “Whatever you do, be sure to check out the house before you buy it.”

I assured her that I would, then immediately decided to ignore her wise advice. I thought the seller wouldn’t fix anything, so what’s the point of checking? After all, I had looked closely during my pre-purchase visit to the house and nothing major had jumped out at me.

Well, let me tell you in case you don’t already know this: there are plenty of things that can go wrong with a home and its possessions that are not immediately visible. Depending on the details, It can be really expensive to fix.

While I don’t think getting checked before buying this particular home would have changed my mind about buying it, it could very well have resulted in more negotiating power over the price – and in the process, saved a boatload in interest as it would have counted on less Mortgage amount.

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