I’ve written this before on my site but it’s worth repeating: you usually don’t succeed in life without falling down flat on your face a few times. I recall Winston Churchill coined this phrase:
“Success consists of going from failure to failure without loss of enthusiasm.”
When it comes to investing, you’re going to make a few mistakes and you’ll probably start losing your enthusiasm in the process. Don’t. Nobody is perfect.
I’ve made a number of financial screw-ups over the years and I’d like to think I’ve learned from all of them. Part of the reason why I run this blog is to chronicle those mistakes to help me avoid making similar ones in the future. Hopefully by sharing my mistakes I’m helping you too. Let’s revisit some of my blunders.
- I bought TransAlta
I owned this company for a few years and chased some yield in the process. I eventually cut my losses, applied those losses against some capital gains in that tax year and never looked back.
- I bought mortgage life insurance
You can read this post here why this is a bad financial product, for me, for you, the consumer, but a great one for the financial lending company. My suggestion is not to buy mortgage life insurance, get permanent or term life insurance instead. There is an excellent overview about Life Insurance 101 here.
- I bought penny stocks
You really can’t make a bigger dumbass financial move than trading penny stocks. Or maybe you can….see #4.
- I invested in high-priced mutual funds
Sigh. I used to pay high money management fees to own products that underperformed the stock market. Not anymore. Don’t make this same mistake.
- I used to tinker with my portfolio
As a novice investor I was very guilty of chasing hot-performing products. So, in my 20s, not only did I pay sizeable money management fees for those mutual funds above but I also chased the performance of those funds. Fund studs often turned into fund duds very quickly. Over the past few years I’ve learned to train my investing brain.
Those are five big financial failures (and I have more than these) but now it’s your turn. I want you to share your mistakes with me and others.
You have something to gain from this other than reminding yourself not to make the same mistake twice and helping other investors who read this site – by sharing your big fat investing mistakes, thanks to my partnership with 5i Research, I will giveaway one (1) 5i one-year subscription to their conflict free investing research, a $150 value to one lucky reader. Feel free to enter my giveaway below and I’ll contact the winner via email after it closes.
In the end, by learning lessons, hopefully we only make some mistakes (including our financial ones) once in life. From the words of Dale Carnegie:
“Discouragement and failure are two of the surest stepping stones to success.”
Keep stepping your way forward folks.