Two Financial Mistakes You Would Make Again

by Ron Haynes

This guest post was written by Go Banking Rates, bringing you informative personal finance content and helpful tools, as well as the best interest rates on financial services nationwide. Follow them on Twitter at @GoBankingRates and on Facebook at /GoBRates.

view-from-the-hammockPhoto by jnewland

We’ve all heard variations of the saying before: “money doesn’t make you happy.” That could be true, but money does make you comfortable. The pleasures of financial stability, steady income and a packed checking account versus the stresses of debt, bad credit and financial pressure are vastly different. We can only avoid such a predicament if we’re smart with our finances, make good decisions and budget appropriately.

When it comes to financial follies, is there a time when they’re acceptable? When is the panic tolerable? When you’re shaking under the discomfort of debt, is it sometimes worth it? We believe there are two such occasions when over-spending is justified.

#1: I Now Pronounce You Broke?

wedding-sign Big celebrations may be some of the most memorable events in your life. They can also be some of the most expensive.

How about a wedding? Weddings can typically cost tens of thousands of dollars. Traditionally, the bride’s father foots the bill, but that’s not always the case.

So let’s say you and your fiancé are preparing for the big day. It is supposed to be a once in a lifetime occasion and chances are the bride hasn’t been dreaming about a chapel on the Vegas strip or tying the knot in a courthouse.

Let’s look at a short list of expenditures: You’ve got the “save the dates,” invitations, wedding dress, tux, rehearsal dinner, cake, church, reception hall, decorations, flowers, limo, music, the catering and the drinks… Oh, and thank you notes. Nice ones.

It seems something like a wedding could result in some debt. So, do you go for a full sit-down dinner and an open bar or hors d’oeuvres and cash bar?

Then, of course, the wedding is followed by a honeymoon.

Justification: You can’t put a price on love! You might as well go big for the wedding because who wants a rocky start? Plus, as newlyweds, you’ll hopefully be spending the next few months only wanting to spend time with each other, anyway. Staying in will give you an opportunity to save some money and pay off the credit card bills.

#2: The Unforgettable Experience

No matter how much cash you put down, you can’t buy life experiences. Memorable times don’t necessarily have to be expensive, but getting to the destination where memories are formed can be a potential threat to the bank account. If you can genuinely fill in the blank to the following statement, it’s simply too important to skip:

“If I miss ______, I’ll never forgive myself.”

alabama-vs-texas-2010-rose-bowl-smackdown Depending on the stage of life you may be in, the answer can vary across the board from as trivial as your favorite team’s championship game to the far away funeral of a loved one. Can you think of an event that has taken place in your life that you can’t imagine not having been there for? The ones your friends and family refer to constantly? The ones that frequently cross your mind? More memorable moments will happen again. It’s up to you to prioritize, but sometimes life’s events are too important to fret over the finances.

Justification: You truly can’t buy back time. One great experience can be satisfaction enough to stay in and save up for the next one. If you don’t involve yourself, you’ll be missing out on a lot more than your extra cash.

Should You Go for It?

Go Banking Rates is not recommending you default on your credit cards by buying extravagant luxuries. Just ask yourself if it’s something that ultimately will have more of an impact on your life than your bank account. If you know your cash flow will recover, go for it if you’ll never get that opportunity again.

Palm trees photo (view from the hammock) by jnewland

About the author

Ron Haynes has written 1001 articles on The Wisdom Journal.


The founder and editor of The Wisdom Journal in 2007, Ron has worked in banking, distribution, retail, and upper management for companies ranging in size from small startups to multi-billion dollar corporations. He graduated Suma Cum Laude from a top MBA program and currently is a Human Resources and Management consultant, helping companies know how employees will behave in varying situations and what motivates them to action, assisting firms in identifying top talent, and coaching managers and employees on how to better communicate and make the workplace MUCH more enjoyable. If you'd like help in these areas, contact Ron using the contact form at the top of this page or at 870-761-7881.


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{ 3 comments }

Ace

Ron you make a really great point here. I think sometimes we get so caught up in maxing out ROTH IRAs, getting the highest possible match on our 401(k)s, building emergency funds that we sometimes forget why we’re trying to save in the first place! Money doesn’t buy happiness, but it can be a great tool for getting you where you want to be.

My only word of caution is the distinguish that gray line between living life to the fullest, and using a major life event as an excuse to get into debt. Striking that balance is key. I appreciate the perspective that you brought in this post Ron.

Jenna

Two financial mistakes I would make again if I had to do it over again in life.

#1. Loaning my Retirement account to my husband so that he could get thru medical school (only to have him leave me after I worked to put him thru as well and he left me with almost 200K debt)

#2. Going further in debt to put my daughter thru college (only to have her not talking to me today since I can’t give her more)

I sit today with less than a high school education going hungry but I do know if I had to do it over again I would do it the very same. However, I will not let someone else do it to me again.

Victoria - Ozarks Crescent Mural

Thanks for pointing out that it makes you comfortable and there’s the pleasure from accomplishing your financial goals. Someone asked on Facebook, “Does money make you happy?” and I brought up these same points and said that these positive emotions of security, stability and responsibility are a form of happiness. Believe it or not, some people still wanted to argue with the idea. Not me, I wouldn’t trade how much better it feels to have savings than to have debt.

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