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While college can set a person on the right track on a number of fronts, it doesn’t always prepare one adequately for life in the real world. One of the aspects that I quickly found college had not fully equipped me to handle was that of personal finance. While I was probably in a better situation than most due to my interest in the subject, that doesn’t mean that I didn’t make mistakes along the way after graduation.
The following are a few of the freshman financial mistakes and missteps that I made after graduating from college and how they ended up costing me.
Taking a Recruiter’s Word
Even as a senior in college, I was still a bit naive as to how the real world worked. So when a recruiter from the company I finally signed on with after college told me I would be working in one particular suburb of Indianapolis, I believed him.
That belief led to my signing a lease for an apartment just blocks from where I thought I would be working. After I had moved into the apartment however, I was notified by my employer that I would not be working in that particular area after all, and instead I was to be placed in a different location, a 45-minute drive from where I had moved.
This same recruiter also gave me a run down (that turned out to be incorrect) on the wardrobe I would need for my particular work, which left me buying clothes that weren’t at all suitable for my job. While both mistakes cost me money, more than that, they were a lesson in taking things people told me in job interviews and life in general with a grain of salt.
Company Stock Sale
My company stock sale mistake was largely due to impatience and lack of foresight. Shortly into my hotel career, I purchased several hundreds shares of discounted company stock through a stock purchase plan. After a couple of years and after the stock had gone up about 20% from my initial purchase price, I decided to dump it, even though I really didn’t need the cash. I was just so excited to have made a profit that I wanted to cash in.
Several years later, the company was bought out and the stock price soared to nearly four times the price at which I had sold. Had I just been patient, my rewards would have been much greater.
Too Much Attention
The following freshman mistake didn’t cost me so much in the way of money, but rather in anger and wasted time and energy.
I used to check my 401k almost daily. It drove me nuts seeing it plummet when the market went down, and then only regain a fraction of what it had lost when it markets went up by an equivalent percentage. While this did teach me some valuable lessons regarding my investments, it also got my blood boiling — and for what? I couldn’t touch that money for another 35 years at least, so what was I getting so hot and bothered about?
There wasn’t much I could do, so I just started checking it once a month and things felt a bit better — although I still felt the whole 401k thing was a bit rigged. It always seemed that when I lost, losses always seemed to equate percentage wise to the markets, but when I gained, they weren’t comparative gains. I’m sure that any analyst or financial advisor would just say I was being paranoid. Maybe I just chose poor funds.
Getting Lost in the 9-5
It can be good to work hard and focus on one’s career, but sometimes it can detract from other life goals, options, and opportunities. Early in my career, I threw myself into my work. There were many 10-12 hour days, often six days a week, and for very little pay, but this was all in an effort to make a good impression on my bosses and move up the promotional ladder, which indeed is what happened.
However, I realize now that throwing myself into my work in one career blinded me to other options. I became lost in the daily grind, and I failed to look outside the industry and field in which I plied my trade to consider other career opportunities. And once I had climbed to an upper management level position, I realized that this indeed was not the career for me. I then had to start all over in a career in which I could have started much earlier had I not been so fixated on the incorrect path.
While I understand that such mistakes are a part of living and learning, and that my initial career built the financial foundation and provided much of the learning and opportunity for moving into my current career, I just wish I had made the decision to move on earlier, as I may have missed out upon valuable opportunities and experiences during that time.
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Disclaimer: The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute legal or financial advice. For financial advice, readers should consult a licensed financial advisor. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.