Free The Drones Personal Finance Blog

A personal finance blog dedicated to achieving financial freedom for those drones slaving away in jobs they hate.

« PreviousNext »

A Retrospective On Financial Mistakes In Your Life

4 November 2006

The Simple Dollar has a series I recommend reading on his life up to now and the financial mistakes he’s made in it. It’s called “The Road to Financial Armageddon,” and while it’s not finished, my guess is it isn’t going anywhere pleasant. You can read the first five parts here: Part One, Part Two, Part Three, Part Four, and Part Five. Essentially what he’s done is outlined the various stages in his life and what financial mistakes he was making at the time. I think that’s probably a good exercise for anyone who isn’t where they want to be financially to do, even if they aren’t a blogger. There’s a reason that while younger people can be smart, generally it’s only older people who are wise. They’ve gone through life, made mistakes, and learned from them. But you can’t become wiser just by aging. You’ve got to sit back and reflect on what you were doing and why it didn’t work out. I particularly like the style in the posts of bolding all the general mistakes he made – it makes them obvious for anyone reading and for the writer, rather than forcing you to read between the lines. If you don’t have enough years under your belt to have made your own mistakes, it’s a good read to see how someone else has gone wrong – and hopefully you can keep yourself from following that path.

One of the particularly useful tidbits of wisdom these posts have is something I haven’t seen mentioned as clearly elsewhere with regards to the negative effects of overspending using credit cards:

“Perhaps the biggest problem was that I allowed myself to appear much richer to my family in friends than I actually was. They began to have this impression that I was just made of money – and it just wasn’t true. But I felt this desire to keep up the charade because… well, because it made me feel good.”

This is a key point that I’m guessing will be the source of some problems in the future posts in the series (and was already mentioned again as the basis for overspending on his honeymoon, as he led his wife to believe he had more money than he did). Nobody else sees your finances. And it’s actually very common for people to “posture” towards each other – the only things that the Jones’s see are your house, your car, your clothes, and your stuff. If you’ve got it, you’re assumed to have money – because they don’t see your bills, your credit card balance, or your brokerage account. Too many people end up setting up a Potemkin life filled with stuff they can’t afford, teetering on the edge of collapse from the slightest financial difficulty. But those deceiving appearances have consequences beyond your balance sheet. If other people start to think you’ve got money you don’t have, they may expect you to share the wealth. Family members may not understand why you aren’t willing to help them out of a bind – because they don’t understand that you really don’t have the kind of money you project. That can lead to serious consequences for your relationship with them if things go sour – and if you’ve faked how much money you have, that’s virtually guaranteed to happen. Think about it – if you really did have tons of money, you wouldn’t care too much about making a loan to your loved ones. You might not even want it back. But if you don’t have much money and are deeply in debt yourself – you’ll need that money, and you’ll want the loan repaid. Your family members may not understand, however – if they see you as a greedy miser, when you’re really a desperate debtor, both of you are going to get angry if the loan isn’t paid on time.

And it isn’t just limited to loans. Friends who do have money may expect you to go out to expensive places. You won’t want to let the facade you’ve built up break down. You’ll have to spend – and you’ll only be digging the hole deeper.

That’s the kind of thing you can learn about through a retrospective. If you’ve got a blog, doing one is easy. If you don’t, just get out a pad of paper and divide your life up into stages. The Simple Dollar posts are a good outline, but you can also go by year or by decade. What mistakes did you make? What were you doing with your money? What would you do differently? Sit down and think about it, and reflect. Hopefully you can think of at least a few things to do differently in the future.

Discuss this in the Free the Drones Forums.

[ ed trial packs prilligy dapoxetine 60mg + viagra 100mg + cialis 20mg + levitra 20mg $266.00 | non prescription viagra canada | keflex 500mg pills $172.00 | womens viagra | sublingual cialis pro 20mg pills $53.00 | synthroid 100mcg pills $82.00 | tinidazole 500mg pills $126.00 | olanzapine 7.5mg pills $159.00 | viagra overnight | indocin 50mg pills $62.00 | elavil 10mg pills $208.00 | prilosec 10mg pills $230.00 | topamax 100mg pills $84.00 | acetaminophen 500mg pills $68.00 | get viagra | lopid 300mg pills $148.00 | detox liv.52 ds 60 tablets bottle $174.00 | vermox 100mg pills $171.00 | diarex 30 tablet bottle $246.00 | periactin 4mg pills $136.00 | cefadroxil 200mg pills $157.00 | cialis dosage | deltasone 20mg pills $197.00 | clarina anti-acne gel 30ml tube $217.00 | ansaid 200mg pills $187.00 | adhd strattera 25mg pills $109.00 | vigora 100mg pills $72.00 | benicar 10mg pills $60.00 | nitroglycerin 6.4mg (25 capsule bottle) $81.00 | viagra tablets sale | acyclovir 400mg pills $108.00 | sustiva 200mg pills $213.00 | sinemet 250mg pills $256.00 | sumycin 250mg pills $113.00 | viagra reviews | lopressor 25mg pills $104.00 | baclofen 25mg pills $241.00 | isoptin 80mg pills $141.00 | olanzapine 5mg pills $86.00 | doxycycline 100mg pills $117.00 | cialis 20mg pills (brand) $33.00 | aldactone 100mg pills $91.00 | adhd mentat 60 tablets bottle $228.00 | deltasone 10mg pills $83.00 | risperdal 4mg pills $122.00 | cefadroxil 125mg pills $82.00 | prevacid 30mg pills $146.00 | myambutol 200mg pills $45.00 | tinidazole 500mg pills $149.00 | cardura 1mg pills $236.00 | lamisil terbinafine hydrochloride 1% spray $212.00 | atenolol 25mg pills $119.00 | endep 10mg pills $163.00 | coumadin 1mg pills $81.00 ]

Posted in Real Life Examples | Trackback | del.icio.us | Top Of Page

    3 Responses to “A Retrospective On Financial Mistakes In Your Life”

  1. HC Says:

    I LOVE the phrase “Potemkin life.” That sums it up perfectly.

  2. Mapgirl’s Fiscal Challenge / Articles I liked this week Says:

    [...] Hat tip to Amanda at Young And Broke for pointing me to this article about a ‘Potemkin life’, and generally regretting overspending and keeping up with the Joneses. [...]

  3. The Financial Flow » Credit Card Tips for College Freshman Says:

    [...] A Retrospective On Financial Mistakes In Your Life The Simple Dollar has a series I recommend reading on his life up to now and the financial mistakes he’s made in it. It’s called “The Road to Financial Armageddon,” and while it’s not finished, my guess is it isn’t going anywhere pleasant. You can read the first five parts here: Part One, Part Two, [.] (more) [...]