We all make mistakes. We also all make financial mistakes. Trust me, I read a lot of personal finance blogs and have met some of the titans in the industry, and no one is perfect. With my birthday (March 10th!) just around the corner, I have been in a very reflective mood of late. Every year around this time, with my birthday in March and “blog-versary” in April I tend to wander down the road of “what if” and think about the choices and decisions that led me to where I am today.
And where is that, exactly?
As of writing this (March 4) I’m the happiest I’ve ever been. Seriously, seriously, seriously. Things just keep getting better. Even the hard knocks (like losing my job a few weeks back) don’t seem to phase me as much. This is because I feel I’ve finally reached the point where I can appreciate my mistakes and the lessons those tough times always teach. After all, the financial messiness and stress of my youth led me to LBMT. I’m not perfect, but I’m a lot more financially responsible than I used to be. I could go on and on about “all roads leading to Rome,” and all of that, but in honor of my birthday, I thought I’d recount for you some of my yuckiest financial decisions, and how I benefited from them in the long run.
#1- Taking Out that Tiny Student Loan
I don’t know if this is common knowledge or not, but I graduated without any student loan debt. My parents viewed college as a gift, and it ended up being one of the best they could have given me. Many often ask how I was able to afford my first home at 26. Well, betches, It’s because I was one of the lucky unicorns who graduated college with zero loan burden.
Exceeeeeeeeeept for that one $3800.00 loan I took out just to spite my mother. Well, not really, but let me explain. You see I transferred colleges after my sophomore year. When I moved to the new school my parents didn’t want me living alone in an apartment, or WORSE, in an apartment with friends I’d made at orientation and didn’t know very well. They insisted I live in the on-campus dorms for the first year, and since they were paying for it, I had to play by their rules. I didn’t want to share a room with someone, so ended up getting a single room. As a transfer student, this was exceptionally lonely, and living in the dorms as a junior (a.k.a someone who just turned 21) was truly terrible. They had restrictions on who could come visit, didn’t allow alcohol even if you were of drinking age, and the hallway and parking lot were often noisy until late hours of the night.
Then I did a show and met an awesome girl who was looking for a roommate. When we found the perfect house to rent, and it all seemed kismet…except my parents weren’t going to pay for another house when they’d already paid for my dorm. So, I took out a loan to put down the deposit and pay rent for the rest of the semester and summer. Was it the most fiscally prudent thing to do? Of course not, but I have so many amazing memories in that house that I don’t even care.
You can’t put a price on memories, or friends, or the events that occur in college that make the experience a very distinct point of time in your life.
#2- Taking A 40% Pay Cut
After making close to $100k in 2011 working my job in New York City (total combined base salary with my bonus, # based above is just base salary to base salary) I had unrealistic expectations of what I should be making at 24 years old. I was very lucky and fortunate in NYC, and I knew when I decided to move back home I wasn’t going to be making nearly as much. I largely chalked this up to a “cost of living” adjustment. But when I was offered a chance to leave assisting behind for good and work in marketing, I jumped at the chance, but I had to take a pay cut to make that happen.
Any time you lose money in the double digits, it is going to hurt, but I didn’t even bat an eyelash. It was an amazing opportunity. Sometimes you have to sacrifice short term gain for long term progress, and I did just that. Working for a start-up I was able to put my hands on a lot of projects I otherwise wouldn’t have been able to experience working as an AA or in a more staunchly corporate setting. The skills and experience I gained at that office put me ahead big time when I was searching for work this time round.
And also money in NYC doesn’t go as far, so my lifestyle was essentially the same. Expensive New York City FTW!
#3- Participating in An Expensive Hobby
Out of ALL of the hobbies you can do, community theater is actually one of the most economical. But I got many funny looks when I told people I was commuting 40 minutes to do both of the shows I participated in recently.
“Why would you do that?” A friend asked. “There are tons of theaters closer.”
Well, yes. And I’m not ruling that out. But when it is a show you love at a theater you’ve come to love, money doesn’t matter. Although I did spend an extra $200 on gas for the months I was in the show.
#4- Eliminating my Savings to Renovate My Home
If you’re an HGTV addict like I am, (or well…used to be before my life became an HGTV show of its own….) you will have seen this scenario countless times. Picture It: A homeowner thinks a renovation will cost X amount of dollars. It actually cost Y amount of dollars, and they have to dip into personal savings to finish the project.
It. Was.a.Nightmare. And raiding your savings complete is something that should be avoided at all costs, but when you are a first time homeowner AND a first time renovator, you learn a lot while spending a lot more. What was I going to do, not finish the plumbing in my house? Go without HVAC? I had to bite my tongue and pay the money and chalk it up to a good learning experience. At the time, the kerfluffle with my contractor upset me even more than my break up, and I still don’t like talking about it, but I take a look at my beautiful house and know that it was all worth it.
I’m a homeowner now, and aside from having renters who pay my mortgage, I also have equity in the home, and owning a home makes you different. It’s a sense of pride I can neither describe nor put a dollar value on.
When all is said and done, are mistakes really mistakes? What is something irresponsible you did with your finances that actually turned out to be a good thing?