Friday, May 25th, 2018
Have you ever made a silly money mistake that's left a lasting impression? No, I'm not talking about that time you bought a car that you couldn't afford, but rather small mistakes that really don't make a difference in the long run?
Why is that? Why do we remember that pricey latte but forget about the big things?
Despite the fact that the following money mistakes didn't cost me much, I definitely won't be forgetting these experiences anytime soon.
Ever since my wife and I visited Holland, we've been in love with Gouda cheese. One day we decided to treat ourselves, and went to a cheese store nearby where we could get a wedge of the Dutch delicacy. We weren't looking for anything fancy, but an aged Gouda sounded great.
When the cashier put the cheese on the scale, it came out to $55, which we assumed was for the entire round. Nope, that was the price for the slice we had just picked. Now whenever my wife I buy cheese, we ask each other: "do you think it costs $55?" It's become our inside joke.
Lesson learned: Ask about the price before buying
In my younger years, I thought my friendships would last forever. That all changed when I lent a few friends money.
One good friend of mine in high school borrowed $300 from me because his girlfriend needed to move out. He claimed that it was a short-term loan, but I never saw that money again.
Years later after high school, he reached out and wanted to reconnect. I reminded him that he still owed me $300, and he never replied back with a good time to meet up to pay up. These days, I'm a bit hesitant to lend friends money and if I do, I accept that I may never see that money again.
At the time, $300 was a lot of money to me, and it ultimately cost me a friendship.
Lesson learned: If you lend money, have a payback plan in place
After my wife and I got married, we went to Italy for our honeymoon. We arrived in Florence and we saw street vendors selling tripods. It was difficult to get pictures of us together, so we figured buying a tripod would be the perfect solution. After talking the vendor down to 15 Euros, we thought we had scored the best deal.
The next day we headed off to Venice and I was composing the perfect shot in St. Mark's Square. I started to connect our camera to the tripod when the head snapped off. We didn't even take one picture and the tripod was now useless. I guess that's what I get for thinking I scored a deal from a random street vendor.
Lesson learned: Don't buy something from someone you don't trust
As a child, I spent my allowance on things I was convinced would go up in value. This included purchasing comic books, baseball cards, and even Pogs.
Sure, some of these things increased in value for a time, but they definitely weren't long-term investments worth keeping. Fortunately, I never got into the Beanie Baby craze.
That being said, when Star Wars: The Phantom Menace came out, I lined up early to purchase action figures, again convinced they would go up in value. They never did, and now I have a box full of Jedis at my parents' place.
Lesson learned: Don't assume something will appreciate in value over time
At my first job, the closest bank machine to the office was not owned by the bank where I had accounts. I was in my early 20s and pretty lazy, so I would just withdraw money there and not worry too much about the $2 fee I was being charged every time.
The thing is, I was only taking out $20 or $40 each time. I spent years withdrawing money from that machine, so I probably spent hundreds of dollars in fees for no reason. These days, I refuse to pay fees and only withdraw money from ABMs that belong to my bank.
Lesson learned: Don't pay extra fees if you don't have to
None of these silly money mistakes will affect me in the long run, but all of them have made a lasting impression. To be honest, I'm happy I made these mistakes since I learned from them and now I'm smarter with my money.