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Buy low, sell high.
In hindsight, is far and away the worst advice I ever got. Why? Because it implicitly presumes that you know when low is low and high is high, which you don’t and can’t. This in turn gives one a stock picking mindset, which is a fools errand for 99% of amateur investors and probably a good percentage of those who consider themselves professionals.
Over the years stock picking has cost me tens of thousands of dollars in either actual losses or paper losses where if I’d hung on for another stretch of time I’d have made a lot more than I did.
The best advice I ever got was to abandon a stock picking mentality and instead to invest in simple index funds, and only the minimum number of those at that.
I talked to a financial advisor through my bank in 2010 after I was looking to try and get better returns than term deposits. they encouraged me to buy into an actively managed fund which turns out had really high fees and I ended up only making around 4% yield – I would have been better off with the term deposits!
In the mid 1980’s, listening to a $6.00/hour security guard tell me what a sure thing investing in commodities on the Chicago Board of Trade was. So I borrowed against my credit card to fund my account and start trading. I consider myself lucky I only lost around $1500, but still a lot of money when you’re working two jobs and paycheck to paycheck. My older self looks back and asks, “what was I thinking?”.
Listening to advice from so-called experts. Listening to so called stock market gurus. Listening to advice from rich people, such as Suzie Orman and those like her. Those who did not get rich from investing, but got rich from giving advice on investing
Buy as much house as you can. Definitely slowed down our financial progress since it left us house poor.
Buying a “systematic plan” mutual fund with a high front end load along with a whole life insurance policy.
Rolling my qualified 401k into a self directed IRA to expand my investment options. I had no idea that in my state of residence that an IRA enjoys much less legal protection than an IRA from things like lawsuit protection. Yes, I’m well aware of things like umbrella liability policies and federal bankruptcy to try to mitigate any potential loss if I’m ever subject to a large lawsuit. But those are essentially attempts to try to regain some measure of the legal protection I unknowingly gave up when I did the rollover. Certainly those mitigations won’t provide me the same level of peace of mind I’d enjoy if my retirement account still resided in my 401k.
We bought a five year CD’s at our bank for 10.5 per cent/year interest in 1981. We knew absolutely nothing about investments and this is what our bank offered my wife and I for our IRA contributions. I don’t think anyone in either of our families had a brokerage account at the time, which was for rich people who hired Merrill Lynch, Pierce, Fenner & Smith.
Later I learned about stripped 30 year treasury bonds where I could have gotten 14 per cent/year compounded tax free for 30 years guaranteed by the US Treasury!
Interesting to note the Dow crossed 1000 in early 1982, but finished 1981 at the lofty level of 875.
https://timesmachine.nytimes.com/timesmachine/1982/10/12/214781.html?pageNumber=1
In about 2007, all our stock investments were in my employer’s Dell stock. My advisor recommended against diversifying but to hold on to that stock forever. Not sure how much we lost but it was certainly significant.
After my parents died early, I inherited money. And then ‘financial advisors’ of all kinds came out of the woodwork. I was too grief stricken to think clearly. Ended up with life insurance I didn’t need. Stocks that I did not care about. Mutual funds especially bond funds that were unnecessary at my age. A stockbroker who traded instead of invested for the future. (Hence the definition of a stock BROKER.)
So from this I learned that many ‘financial professionals’ own goals was to separate me from my money. Even got horrific advice from the probate attorneys. Lesson learned in hindsight? Don’t make any decisions for a year (and in my case more than a year.)
An estate planning attorney once told me to fund a trust instead of funding a 529 account for college savings–never mind that I have four children and college costs a fortune, while the chance of having a taxable estate is much slimmer and much further down the road.
Following the recommendation of our financial advisor, we refinanced our home mortgage in 2005 with an interest only loan. Seven years later we refinanced again with a conventional 30 year mortgage.
“Stay in your job. It may not be what you like, but it pays a lot of money.” A bunch of extra pounds and chest pains later, I got out, went into a lower-paying profession that I loved, and my only regret was not doing it sooner.
I wrote (https://humbledollar.com/2020/09/paradise-lost/) recently on my biggest financial regret.
Investing through a firm because it was recommended by my employer.
Borrowing from my 401K in my younger years. Ugh.
I got caught up in the internet bubble of the late 90’s. A friend of mine got me to jointly subscribe to a technology newsletter with the pitch that we should not be satisfied with 100% returns on stock investments every year. With this newsletter, we would be making 200% and more. I can’t remember all the names that cost me money from following that advice, but Global Star and Global Crossing are a couple that come to mind. I took some losses, but got out before financial ruin. But as I recall, my friend lost 90% of his retirement fund by remaining a true believer. My take away is don’t take investment advice from family members or good friends who appeal to our greedy side.