8 Women Reveal the Biggest Money Mistakes They’ve Ever Made

8 Women Reveal the Biggest Money Mistakes They’ve Ever Made

Sometimes life teaches us some painful financial lessons, but they can be solved.

By Wendy Robinson

There is an old saying that “experience is the best teacher,” and I can tell you from my own experience that sometimes, that teacher can be downright mean – particularly when it comes to learning financial lessons!

Like many people, I learned about money management through trial and error, and made some expensive mistakes along the way, including buying myself a $15,000 new car for a college graduation gift before I actually had a post-college job lined up. The payment on that car ended up being more than my rent and was a serious financial burden. As much as I regret that car, I can’t deny that I learned a valuable lesson: Don’t buy more car than you can afford.

We all make mistakes, as evidenced within the following “lessons learned” by eight women (who have requested to remain anonymous). Maybe they can help you avoid costly missteps of your own.

1. “We bought our house in 2005 with no down payment and with an interest only, adjustable rate mortgage. We were young and really didn’t understand what we were doing. After three years, the interest rate adjusted upwards and our mortgage payment went from a manageable $945 a month to a tight $1,367. We tried to refinance and discovered that not only did we have NO equity in the house, but the house was also worth $75,000 less than we had paid for it. We were way underwater. Ten years later, and we still owe more than the house is worth.”

Lesson: There is a reason a 20 percent down payment is still the gold standard. Not only does it help you avoid paying mortgage insurance, the equity can help make your payments more reasonable too.

More from P&G everyday: Money Lessons From Families Who Went Broke

2. “I let my idiot brother talk me into cosigning for a car loan for him. My credit was totally wrecked by the time I realized he was six months behind on payments. I’ll never cosign again!”

Lesson: Never cosign for a loan unless you are prepared to pay it yourself or to suffer the credit consequences!

3. “I wasn’t terrible with money, but I also wasn’t particularly thoughtful about it either. I missed a couple of due dates here and there but who doesn’t, right? Well, my husband for one. When we went to apply for a mortgage I looked at my credit report for the first time and was shocked at how low my score was! I had no idea those missed deadlines and the student loan I had defaulted on could do so much damage. We had to buy the house in my husband’s name only, because my score made us less desirable for a mortgage. So embarrassing.”

Lesson: Your bill-paying history is a major factor in your credit score, so make sure you pay all bills on time. You should also regularly check your credit report and score to avoid unpleasant surprises.

4. “My husband always took care of the money stuff, and I never really worried about it or paid attention to the bills. Then, my husband was in a car accident and had a serious concussion. It affected his memory and cognitive skills for months, so I had to take over the finances. I didn’t even know all of the accounts we had, and it was totally overwhelming. Now, he is better, and we do the money stuff together.”

Lesson: Even if it is one person’s job, both partners need to know the where, when, who, and how of paying the bills and managing the money.

More from P&G everyday: 6 Tips for Talking Money With Your Spouse


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5. “Our biggest mistake was never talking about money before we got married. Our worst fights as a couple have been about money: his student loan debt, my spending habits, our budget, you name it! In hindsight, I don’t know if we should have combined finances.”

Lesson : It is never too early to talk about money with your partner!

6. “My partner and I never got around to buying life insurance. We were only in our 20s and didn’t want to spend the money on it. When she got cancer at 28, it was a shock to realize that if she died I wouldn’t have enough money to keep the house. Thankfully, she recovered, but now, as a cancer survivor, it is nearly impossible to get life insurance coverage for her. I wish we had bought it when we were both healthy.”

Lesson: If you have children or a mortgage, you need life insurance, ideally at least five times your annual salary.

7. “We bought a house when we were first married, because that seemed like the grown-up thing to do. What we didn’t think about was the fact that we were still in the moving-around phase of our careers and were unlikely to live in that house long term. When my husband got a great new job, we were faced with a tough decision: turn it down or sell the house at a loss. We learned that you can’t assume that your house value is going to go up or that you’ll be able to sell when you need to. We had to a do a short sale, which was an awful process.”

Lesson: Never buy a house unless you are sure you want to live there for at least five to 10 years.

8. “We didn’t consider child care costs before we got pregnant. And then, surprise! We had twins. The cost of day care for two infants is more than our mortgage. We feel so blessed and SO BROKE.”

Lesson: Be sure to investigate the costs before any major life decision, whether that is having kids, choosing colleges, or something in between!

What is the most valuable financial lesson you’ve ever learned?

Wendy Robinson is a writer, working mom and graduate student. Someday she'd like to sleep in again. She also blogs at www.athleticmonkey.com.

Image ©iStock.com/Neustockimages

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