Error of My Ways

Dennis Friedman

“MONEY MAKES THE world go round”—and that means we’re constantly making financial decisions. Almost inevitably, some go awry. Like everyone else, I’ve made a lot of financial mistakes over the years. Here are some I wish I could take back.

When I was age 23, I graduated from college with a history degree. It wouldn’t take long for me to realize it was a mistake. Early in my career, I was passed over three times for a promotion because I didn’t have a business degree. Tired of hearing the same response, I went back to school part-time and earned an MBA. Result: I lost the chance not only to draw a larger paycheck, but also to save more in my 401(k) and elsewhere during those early years.

Just as the stock market started to fall in 2000, I followed the advice of a financial talk radio personality and took a significant position in a tech-heavy exchange-traded index fund that’s now known as Invesco QQQ. The fund fell from my $71 average share price to just $20. It took many years for the QQQ to reach my breakeven share price.

During the 2000 bear market, I also failed to diversify my bond portfolio. After watching my stock portfolio get hammered, I panicked and sold the bonds at a loss when they started to lose value.

I received a phone call one day from the publisher of a magazine that I subscribed to. The sales representative talked me into forking over $350 for a new five-year subscription. It turned out the call wasn’t from the publisher, but from some outfit that was selling magazine subscriptions. Even though I complained to the Better Business Bureau, I lost my money and never received a single magazine issue. The company eventually filed for bankruptcy. Although it wasn’t a huge financial loss, it taught me an important lesson about doing financial transactions over the telephone.

Last year, I spent $10,000 repairing an 11-year-old car with 125,000 miles on it. I should have put that money toward a new or certified preowned car. Instead, I’m stuck driving an old, unreliable car during a pandemic.

But the money decision I regret the most was small in monetary value, but it had an emotional and psychological effect that haunts me to this day. After I graduated from college, I moved to San Diego, where I met another young man named Jim Evans. Jim and I became close friends. We worked for the same company, hung out together and even double-dated on a few occasions.

One day, a few employees were taking up a collection for Jim and his new bride Cheryl, who was pregnant with their first child. The money was to go toward a baby shower gift. I was more than happy to contribute and I signed the card, just like the other employees.

A few days later, Jim approached me and said, “I bet you gave a lot of money toward the gift.” After his comment, I realized I’d made a terrible mistake. I shouldn’t have contributed to a group gift, but instead bought Jim and his wife a gift by myself. I had treated Jim as if he were just another coworker, rather than one of my best friends. It was not only a terrible money mistake, but also a terrible relationship mistake. When you combine those two elements, it can be devastating—and my friendship with Jim was never the same.

After 41 years, I still feel terrible about how I handled that situation. Sometimes, I search online for information about Jim, hoping I could track him down and somehow erase the bad memory from my mind. I know it’s nearly impossible to find someone with a common name like Jim Evans, but I still try. One day, I was talking to a friend down at the gym. He was telling me about his son, a lawyer who works for the federal government. Since Jim eventually became a U.S. border control officer, I had this crazy idea that maybe his son could help me find him. No luck.

After all these years, I’ve pretty much given up trying to track Jim down. As far as I know, he might have moved to another state or even died. But this incident with Jim still influences how I handle my money. Every time there’s money coupled with friends and family, I make my intentions clear and I try to make sure there are no hard feelings.

Dennis Friedman retired from Boeing Satellite Systems after a 30-year career in manufacturing. Born in Ohio, Dennis is a California transplant with a bachelor’s degree in history and an MBA. A self-described “humble investor,” he likes reading historical novels and about personal finance. His previous articles include Anybody’s GuessDon’t Count on Me and Don’t Go It Alone. Follow Dennis on Twitter @DMFrie.

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