To hear what sparked this conversation in the first place, we reached out to Reddit user The_guy321. He told Bored Panda, "I recently have been focusing more on my financial health. I am nearly 38, and the weight of long term financial planning is setting in."
"I asked the question for two reasons. First, so I could learn from the collective mind that is Reddit on what to avoid. Second, entertainment value. Some of the answers had me laughing pretty good (hopefully with the commenter)." He added that, thankfully, he's never made any significant financial mistakes himself, but he does wish he had invested more earlier on.
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We were also curious if The_guy321 learned anything from the responses to his post. "According to the comments, don't get married!" he shared. "I am too late to avoid that, but I have no complaints in making that decision."
He also shared a few tips for anyone who's recently made a financial faux pas or doesn't have the best track record managing their money. "Check out r/personalfinance on Reddit. Tons of great information and helpful people." Some of his top tips were, "Live within your means, avoid credit card debt, build up a 3-6 month emergency fund, then invest in index funds as early and as much as you can until you are nearing retirement age."
And if you make a mistake, don't beat yourself up about it. "Mistakes happen," The_guy321 told Bored Panda. "Learn from them, and move on. Dwelling on the negativity does no good."
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We also reached out to financial advisor Michael Kitces to gain more insight on this topic from an expert. Michael was kind enough to open up about some of the financial mistakes he made in the past that he's not particularly proud of. "I think the highlight is probably in my college years, back in the 1990s," he told Bored Panda. "I had been an avid player of Magic: The Gathering (in its early days!), and had a lot of the really rare unique cards from the early years."
"In 1999, I sold my Magic collection for $2,000 (back then, that was a lot of money!), so that I could put it into an online brokerage account to become a day-trader (the tech stock boom of the 1990s had a day-trading phenomenon similar to the Robinhood era of today!). Within 12 months, I had lost all $2,000," Michael confessed. "Nearly 25 years later, Magic The Gathering remains incredibly popular, and I was able to recently estimate that the cards would be worth well over $50,000 if I had just kept them instead of trying to day-trade stocks."
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People like to think about marriage as an emotional and physical commitment and tend to forget that it's a financial commitment as well.
If you get entangled with someone who has no clue how financial management works, you're in for a rollercoaster ride straight to hell.
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Terrible financial decision. Don't buy mobile homes kids. Just don't do it
If you've made some mistakes with your money, don't be too hard on yourself. Michael believes that this is an experience we all go through; sometimes, we just need to learn lessons the hard way. "This money stuff isn’t easy, it isn’t logical for a lot of us, and it has a lot of emotional ties," he told Bored Panda. "I don’t know how anyone will be able to fully learn how to overcome their impulses without some pain and hard lessons along the way."
"The faster/earlier we learn these lessons (the hard way), the more time we have to live a life with those lessons going forward! But the idea of 'you can have more wealth if only you didn’t make all those mistakes' may be literally true, but in practice, is an unrealistic idealistic dream. You can’t learn to build wealth without the learning that comes from mistakes along the way!"
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Michael also told Bored Panda that the two biggest mistakes he sees most often are, "Those who spend too much time worrying about what they’re spending without focusing enough on what they’re earning (it’s a lot easier to build wealth by learning to get a raise than trying to cut your expenses to the bone!), and making spending decisions based on the perceptions of others (the most self-destructive spending decisions I see are those who try to buy what other people buy [even if they can’t afford it themselves], or buying what you believe will make you look good in front of others [the 'keeping up with the Joneses' phenomenon]) instead of just trying to spend money on the things that bring you enjoyment. Marie-Kondo your spending!"
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And even after making some financial faux pas, Michael is confident that there's always time to bounce back. "Perhaps the greatest example to me is Warren Buffett," he told Bored Panda. "Warren’s net worth today is over $100 billion, making him one of the richest people in the world. But he was 60 years old before he ever became a billionaire in the first place; which means it took him 60 years to get the first $1B, and the past 30 years to get the other $99 billion."
"When you recognize that even one of the richest people in the world started his first business delivering newspapers at age 14, but accumulated 99% of his wealth only after he turned 60, it gives an appreciation of just how long it takes to build wealth (and how much we can make up for in the later years)!"
If you'd like to gain more financial wisdom from Michael, be sure to check out his website right here!
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We also reached out to Jen Smith, co-host of the Frugal Friends podcast, to hear her thoughts on this topic. Jen shared with Bored Panda that her biggest financial mistake that she made in the past was maxing out her credit cards. "Thankfully they had low limits, $500 and $2,000, but I didn't have the self-control to not max them out. If the 'money' was available, I was going to spend it," she explained. "Once I maxed out both cards at the same time, I knew I needed to get rid of one. My way out was someone backing into my car in a parking lot. The damage was minor enough that I could still drive the car and use the insurance money to pay off the $2,000 card and cancel it. That dent was a constant reminder of that card."
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"Whether you learned about money from your parent, school, or nobody at all, everyone makes mistakes with money," Jen told Bored Panda. "And those mistakes teach you more about money than anyone in your life could. Count yourself lucky if you make mistakes when you're young because the stakes are usually lower and the fallout is much less expensive than money mistakes made later in life."
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Jen also noted that getting into consumer debt is one of the most common financial errors for people to make. "When you're not making enough to afford the lifestyle social media is telling you you need, then people will use credit cards, student loans, or finance necessary things like cars to buy more stuff," she explained. "The only solution is to learn how to discern what it is you want from what advertisers and influencers are telling you to want."
"Nobody wants to believe they're easily influenced, but we all are," Jen added. "But when you know what you value, what your goals are worth to you, and what purchases truly make you happy, you can more easily say no to the things you don't really need or want."
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And if you've recently made any financial mistakes that are haunting you, don't be too hard on yourself. "Remember that you're not alone. No matter what mistake it is, someone before you has definitely made the same one," Jen told Bored Panda. "You may want to forget that it happened and move on as quickly as possible, but every mistake is an opportunity to learn and grow. Reflect on what triggered the choice, what you wanted to get out of it, and how it was a mistake, and consider how you'll handle similar situations differently in the future. Don't miss the opportunity to grow and do better."
If you'd like to hear more encouraging words from Jen about how to use your finances wisely, be sure to check out her podcast Frugal Friends right here! And if you're interested in some reading on the topic, you can find Jen's book The No-Spend Challenge Guide right here and her book Meal Planning on a Budget right here!
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