Great ''Financial Mistakes” Hunt. What’s your biggest mistake… help others avoid it.

dunstonh

I hope this post makes people remember to check their financial benefits from work. I took out my first mortgage and thought critical illness sounded a good idea. I paid around £20 a month for three years before twigging that work paid me for a least 6 months. Argh. AND I can't claim againt the broker as I told him I had no such cover - grrr, silly, silly girl.

Income protection and critical illness are two different things.

What you have done is a bit like cancelling your contents insurance because you have buildings insurance. Similar but different. CI pays a lump sum on a defined diagnosis of a critical illness. Income protection pays out until retirement. Your employer gives time limited sickness benefits for 6 months. That doesnt overlap with CI and even if you didnt want CI, then a PHI policy with a deferment of 6 months would have been the other option.

silverbullit

Not buying a flat/house in 2002. At the time i was living with my parents rent-free and was able to save pretty much all of my salary. I had saved about £30,000. If I had bought the flat next door which had come up for sale, and then sold it I would have benefitted enormously from the rise in the housing market.

In fact, my cousin bought the flat and made a profit of about £65,000 in three years! I shall forever rue the day....

dunstonh

silverbullit wrote: »

Not buying a flat/house in 2002. At the time i was living with my parents rent-free and was able to save pretty much all of my salary. I had saved about £30,000. If I had bought the flat next door which had come up for sale, and then sold it I would have benefitted enormously from the rise in the housing market.

In fact, my cousin bought the flat and made a profit of about £65,000 in three years! I shall forever rue the day....

Quite possible house prices could fall back to 2002 prices and the £65k gain in 3 years is a just paper gain at this time. In that 3 years your cousin has also paid council tax and mortgage payments, insurances along with redecoration costs so its not a pure gain.

Investments typically doubled between 2002 and 2007 so you shouldnt have lost out too much. Indeed, you may have made more.

Pauljailer

Lending an ex-girlfriend £1000 for a rental deposit on a house in 2002 so that she could get out of a relationship she couldn't afford to! Six years later she still has my money and is still with the same guy! I am not normally so trusting but she did a great emotional act on this fool!

pill-i-am

johnllew wrote: »

NEVER NEVER NEVER lend money to a friend. Not only are you likely to lose the money, in the process you'll lose the friend as well.

SWIM (a friend) has a small independently run business. Due to outstanding money from several customers (who are also friends) he is facing liquidation (or awkwardly demanding payment on essentially open store credit from close friends)- don't lend to friends and, if you will lend, keep track!

suzithefloozy

Having a mother in law!

Back when my husband was a very young and naive 20 year old he was encouraged to sign some paperwork for his (bankrupt) mother who said he should trust her - they were just for the business bank account. What followed was a very complicated story, which I'll put simply.

The forms were for a loan application (which, by signing the papers, he acted as guarantor for) for £10k which she spent and didn't make repayments on. He ended up with a CCJ, which has made getting and paying a mortgage a nightmare with interest repayments for the 5/6 years. 18 months ago, 2 months after we married, a debt collection company came and demanded we pay £18,000. We had to remortgage (the CCJ had ended and our fixed rate was up) and take out equity to pay a negiotiated sum with the debt collectors and haven't seen a penny from my (again bankrupt) mother-in-law. We have since moved house further away from town so that it was cheaper, to a house with no heating or kitchen, so that we can renovate it ourselves (with the help of friends) and hopefully we can get some equity again. Needless to say, we haven't given her our new address.

His family should be on Jeremy Kyle

Marru

My costly mistakes:

1. Bought an apartment in 1989 when the prices were sky high, paid 6 years of 10 year mortgage and sold just to realise that the selling price just about covered the remaining mortgage.
2. Tried to keep up with a lifestyle of partner (now ex) that I couldn't afford instead of putting my foot down and saying if you want us to do that you need to pay for it
3. Bought into a franchise that ended up disastorously, cost me over 10k in money and over a years worth of working hours in time. Never ever will I touch a franchise again.
4. Not to realise when I first needed a consolidation loan that I was in trouble. Should've pulled the purse strings close there and then instead of getting myself in the same mess again.
5. When I last opened a bank account not to go through cashback site.

And on a plust point, best things I have done:

1. Found this site
2. Stopped living on credit and started DMP

Pobby

Well total roller coaster ride for me. Various businesses,some good,some bad.

Lent money to friends!

Wonderful NOT endowment!

It goes on. However it`s all water under the bridge and a steep learning curve. Also along the way I got some things right like being married for 25 years to loverly lady who is pretty mse and learning to be mse myself.

bigsaverCol

Moved back from Spain in 1999. Sold up and put £60,000 in Spanish bank waiting for a better exchange rate to bring money back. Looked at house in UK for £100,000 but in the end rented instead. 2004 bought £100,000 house for £295,000 and got £45,000 from our £60,000 due to worse exchange rate. Loss over 5 years £210,000 plus 4 years renting. Beat that!

lv1109

Buying our first house in 2001 with a small mortgage. Using credit cards and loans - just because we could, I think :rolleyes:, for nothing in particular. Remortgaging twice to pay off debt (but then maxing credit cards again). Have finally remortgaged, cleared what I can and the rest is on interest free credit cards - that I will keep switching until they are paid. I no longer have ANY plastic (cards, that is) in the house and I will never borrow on personal loans, credits cards, etc ever again. Our mortgage is triple what it started out as :eek: . The only saving grace is that I have reduced the term each time, in line with when I have done the remortgages. Started with 25 years in 2001 and term is now 18 years. Will reduce again if we can afford to when this deal ends.

I am now an obsessive fan of this site and am picking up ways of making money that can only help us out.

We've learned.........but the hard way.