PDA

View Full Version : Best financial decision every made?


Chicago526
08-04-2006, 12:24 PM
Inspired by the "worst financial mistake" thread! :wave2:

What's the best financial decison(s) you've made in life?

For me, it's four things.

1) Starting my 401k at age 23
2) Buying a condo when I moved out of my parents. Best investment I've ever made!
3) Buying my car instead of leasing, and when paid off I kept the car instead of going out to buy a new one. 3 years of no car payments has been wonderful!
4) Keeping my credit history spotless. Everything is paid ontime no matter what.

What are the smart decisions you've made?

Kay1
08-04-2006, 12:29 PM
Driving to the library and checking out "Tightwad Gazette" and "Cheap Tricks."
I've also been investing in energy and precious metals and that's going well. And, I must admit, letting my husband talk me into buying a house about ten years ago. I'm a renter at heart but we lucked into the housing bubble.

Ardenne
08-04-2006, 12:30 PM
I'd have to say #1 was starting to save as early as we did, even though we had very low income at the time. It really made a huge difference.

#2 has been maintaining our 'starving college student' penny-conscious spending habits, even after graduating to real jobs -- and saving all the extra :)

arminnie
08-04-2006, 12:33 PM
Actually total dumb luck - but accepting a job with a company that had a 401K (with 4:1 matching) and a pension plan. The smart part was in not leaving for more salary when I had opportunities come up. The retirement benefits far outweighed a salary increase with no retirement benefits.

Another piece of total luck - buying a condo in New Orleans ten days prior to Katrina. It's on the 6th floor of a VERY sturdy building that had no damage or flooding. There is no housing in New Orleans right now so the properties in my little sliver by the river have gone up a lot.

pilgrimage
08-04-2006, 12:45 PM
Learning to use sites like fatwallet.com, epinions.com and fishingfordeals.com
to help me stretch my budget. Also clipping coupons and living simply so
there were savings to protect during layoffs.

sap1227
08-04-2006, 12:52 PM
-Starting my 401K at 19 years old
-Working a full time job and a part time job to ensure I would get my "retirement" from Publix at 22 (I had graduated college and got a "real job", but I needed 1000 more hours to get my "free stock" from Publix, so I sucked it up and did it--well worth the $8K in stock they gave me).
-Convincing my now DH that each of us should put $700 a month in our savings account starting as soon as we got engaged--it gave us a very nice start in our marriage--no Credit Cards and a good amount in savings at 23 years old (great for our house downpayment and me being able to stay home)
-Working through college so I had no student loans
-Buying our first house at 23


Sigh, at 23 I was financially on track. At 28 we have taken a few steps back (being a SAHM with 2 boys has really depleated our savings and added some debt) but I know in a couple of years we will be back where we need to be!

Cindy B
08-04-2006, 12:54 PM
Buying cars for cash... no car payments for two cars over a year now.. its wonderful

Buying our house when we did, now the houses in the area are worth double.

Doing ING savings... its been wonderful for us.

pearlieq
08-04-2006, 12:54 PM
Getting serious about budgeting and money management early. I was about 20 or so when I got it together. We stopped the flow of money out, cleaned up our debt, and began building for the future.

Also, it wasn't totally a financial decision, but picking DH as my spouse helped a lot. I'm glad I have a partner who is willing to work with me on bettering our situation. Also, his career success as given us a great boost!

I can't stress enough the importance of a spouse who is financially responsible and a hard worker!

bbangel
08-04-2006, 01:15 PM
1. Starting first chequing account at 5. I am now a wiz at saving money.
2. Buying my condo when interest rates were down and just before prices boomed.
3. Saving half my paycheque every month, which allows me to be a world traveller and not feel guilty :)
4. Not getting married or having kids.
5. Not owning a car.
6. Never carrying a balance on my credit card.

kydisneyfans
08-04-2006, 01:21 PM
Quitting KMart and pulling my 401K out before it went bankrupt.

crjack
08-04-2006, 01:23 PM
Two things helped us tremendously:

1) Both of us started 401k's very early and have never stopped contributing. (even though I only work part-time now)

2) Dh took advantage of great tuition reimbursement benefit at his job and continuously went back to school. Several degrees later (and no loans to repay) it helped him to secure a professional position and stay marketable. It wasn't easy with a full time job to hold down and eventually two children but he did it and he finished when our youngest was just turning 1. They dont even remember him being gone so much but it helped to make our future much more secure.

poptoone
08-04-2006, 01:24 PM
1) Bought first house at 21
2) DW and I began contributing a specific amount to savings each month!
3) Began 401-K as soon as eligible at first job
4) Agreed to never have more than 1 car payment and preferably none
5) Pay credit cards off each month (only use to gain cash back)

DW is now a SAHM so #2 isn't happening as much anymore but we are still sticking to the others!

KelNottAt
08-04-2006, 01:24 PM
1. Starting our 401(k)s at 23.

2. Buying our current house. It is perfect for us and has tripled in value since we bought it 10 years ago. As a bonus, the lot was just perfect for us to add-on DH's office. (He's self-employed. So, even tho he works 70 hour weeks, at least he can pull the all-nighters at home.)

EthansMom
08-04-2006, 02:05 PM
1) Starting 401k contributions with my first "real" job and then increasing the contribution as I got raises. By 25, I was maxing out my 401k.

2) Saving in advance for purchases.

3) Using "extra" money to pay off debt rather than spend it on splurges. We've managed to pay off tens of thousands of dollars in debt in only 7 years.

StephMK
08-04-2006, 02:20 PM
Definitely getting into the real estate market before the housing costs exploded!! My condo was a foreclosure and our townhouse was purchased back before prices skyrocketed. Now, the purchase prices of those two properties combined would not even pay for the condo now! If not for those purchases, we would not have been able to move up into a single family at all. It's just crazy & I don't know how new couples do it.

MrsPete
08-04-2006, 03:08 PM
Best financial choices:

Choosing to live in poverty rather than take out student loans. It wasn't easy, but when I graduated, the pain was over -- with loans it would've continued for years.

Marrying a man whose financial goals match mine. We both believe in living beneath our means -- we'd rather live in security rather than luxury. For example, right now we're looking at paying cash for a Honda Civic rather than financing a more expensive car. The key here though is that HE AND I AGREE on these things; I don't think we'd be so successful if we disagreed on these sthings.

Contributing to my 401K and savings from my very first professional paycheck. I was already used to being broke all the time, so it was painless.

Choosing to be a teacher. I know, this doesn't make sense at first glance, but it's really been a good choice for us. It's one of the few jobs that still has an old-fashioned pay-til-ya-die pension plan, and if I live as long as the other women in my family, I will be collecting for a long time. I don't have to pay outrageous prices for day care after school, teacher workdays and summer care. (Plus -- though this isn't really a financial decision -- I don't have to worry about them being home alone in the afternoons.)

mill4023
08-04-2006, 03:17 PM
1. Going back to school shortly after getting a useless degree to get a second bachelor's in Computer Science. This resulted in a job that started at almost triple the income I had been making.

2. Deciding we should talk to a lender and look into buying a house even though we didn't have any cash for a downpayment and had bad credit. We really didn't expect it to be possible, but we were able to buy a new 1500 sq. ft. house that doubled in value over the next 3 years. With that profit, we were able to completely pay off both our cars and still have enough cash to put 20% down on a 3500 sq. ft house in Charlotte, NC.

perdidobay
08-04-2006, 03:39 PM
1 DH and I never tried to live above our means and so had no credit card debt, even when we were poor college students.

2 Bought our first house at age 20 and sold it, and each home since, for a profit thanks to fixing them up a little better than we bought them.

3 Starting retirement savings at the age of 27.

4 Buying a condo on the beach in 2001 before prices got really crazy in 2002.

5 Having a low interest 10 year mortgage on our house
and a 15 year on our condo. Each month we are paying down $2,300 in principal between the two.

6 THE MOST IMPORTANT- having a plan!!!

Caitsmama
08-04-2006, 03:59 PM
Great thread.. Thank you!! I am still thinking of my best advice.. there hasn't been much to report here yet on that! LOL

Lizzybear
08-04-2006, 04:00 PM
Deciding to clear my credit card and sticking to it, took me some failed attempts but i'm so glad i'm well on my way with it now! :cool1:

PRaffen
08-04-2006, 04:06 PM
Taking a $5,000 inheritance received when we were in our late twenties and opening up a college fund for our DS. He graduated last year debt free :banana:

After our first car was paid off, we continued to make payments to ourselves. Never had another car payment.

NeverlandClub23
08-04-2006, 04:27 PM
1. Trading my Jeep Wrangler in for a Mercury Mariner. Same car payment amount just better on gas and more comfortable and something I could see myself keeping long after it's paid off.

2. Starting an Automatic Savings Plan with ING. At first it was just a little bit but now I am proud of myself for how much I've saved.

3. Living with my parents instead of getting my own place. I save so much money and am glad my parents love having me live at home because I love being around them.

4. Being young and knowing how important saving for retirement is.

5. Staying at jobs I hated for the experience. I probably wouldn't have the job I have today if it wasn't for sticking with the horrible ones.

dvcgirl
08-04-2006, 04:55 PM
The biggest would be starting early....my first 401K at age 22 and consistently increasing the amount until I maxed it out, only four years later.

Not getting greedy like many did and selling my DH's stock options on several occasions before the big tech fall. By diversifying what we invested we avoided losing more than most did from late 2000 through 2003.

Using half of that major windfall (well, a series of windfalls) to pay cash for the home we built in NJ despite just about everyone telling us we were nuts. "You'll do so much better in the market!!" Our gains here more than offset any losses we had in the bear market to come.

Lucking out and building/buying that house when we did because we sold it four years later for twice the amount.

Buying another house for cash in Orlando for about 1/3 of what we walked away with from the NJ house and investing it.

Never, under any circumstance borrowing money after my student loans were paid off in my 20s. This was only possible because of two of the events that occured above though.

And finally, continuing to save aggressively and live beneath our means.

When we look back on the last 15 years, we credit everything I mentioned for us being financially successful. A whole lot of it is the result of very hard work. But we are the first to admit that the very large windfalls we've had are a result of my DH being an executive in the right field at the perfect time, and also buying our first home just as an unprecedented real estate boom was beginning.

Don't get me wrong, our portfolio would look good had those things not happened because we are quite frugal. We would have easily retired in our early 60s. However, they opened up a whole lot of options for us that we would not have had if we we both came along just three years later. And because those things happened when they did (and we didn't squander what came our way), we'll retire ten years earlier.

dnoyes
08-04-2006, 05:27 PM
Buying my first home when i was 21, my 2nd at 25 and the third at 32. Selling the first two after renters paid them off for me. :cool1: and paying cash for a cabin in Oregon and buying my mother a condo in Clearwater Fl. with the money. (I'm a good son)

The last car payment I had was in 1985.

My wife and I have always lived off ONLY what I earn.

In the everybody needs a little luck dept. My wifes job. After being a SAHM for many years she wanted to get back to work. Started as a two day a week part time job and turned into a full time position in an Insurance/trust company. They pay our insurance and our kids (up to 24 years old and in school) I am self employed so this saved us over $70k in the last eight years. :Pinkbounc

Toby'sFriend
08-04-2006, 06:38 PM
um, well to be honest for me personally, marrying my husband because he makes some good cash.

But I guess as a couple - back when we just got out of college we were renting a house from an elderly couple. They decided to sell the property and move to Florida so we were out looking for a new place to live.

A lady with the rental department of a Real Estate company took me aside and told me that we needed to BUY and not rent. She encouraged us to scrape up every spare penny we could find for a downpayment, and then walked us through the FHA mortgage process and acted as our buyer's agent. We were clueless but she directed us to a safe neighborhood filled with affordable housing --- tiny tiny houses that all needed a bit of work, but a clean area that was safe for me to take a walk with the dog at night.

We purchased a house for $68k that year and sold it 2 years later for over $90k. This was well before the days of huge housing profits. That profit allowed us to pay off alot of student loan debt, our car, and put a nice down payment on a bigger house. Actually I probably should have sent her flowers because she did us a nice favor.

Skatermom23
08-04-2006, 06:39 PM
To never pay one cent in credit card interest. It has worked so far! :thumbsup2

DVC Sadie
08-04-2006, 08:19 PM
I can't take all the credit for making the right decisions because my parents were so financially knowing that by the time I was 18 I already had a CFP and bought my first piece of property on the water in Florida by the age of 21. I had to be legal before I could sign that contract. It took 5 years to pay it off then I managed to buy another piece of property.

By the time I married my dh I was on my second townhouse and that is how it has been for us ever since. We rarely sold property but instead rented them out and had others pay the mortgage and put the rest in investments or more real estate.

grlpwrd
08-04-2006, 08:24 PM
um, well to be honest for me personally, marrying my husband because he makes some good cash...

:thumbsup2 Same here. Hubby started out at $7 an hour working in a computer lab then he worked for Boeing for years and now his dedication has paid off. We think alike financially.

Investing in real estate - We own 2 homes and plan to buy a condo in Hawaii plus develop our family land on the Big Island (my childhood home).

Learn good savings and investment habits at a young age - I even paid for own braces at age 19. ;) My parents couldn't afford it, but I saved all my paper route money and worked a part-time job for it.

Invested in myself - Taking classes and doing stuff that enrich my life. People make fun of me ( :crazy: ), but one of the best investments was in myself. :teacher: I pay about $213 per class at my community college - a great investment as I am sure I will get lots of dividends once I start my career. :)

sara74
08-04-2006, 10:42 PM
1. EDUCATION!! Sure, I took out loans, but they have been more than offset by the income and flexibility I have as a dentist. What could have been a mistake for me/us was that when DH chose his specialty in dentistry I cried over the three extra years it would take him. Silly me. It was a very wise decision on his part to ignore my moaning and groaning!

2. OTOH, buying our house when we did meant dragging DH into it kicking and screaming and it has been a great investment for us. So I am not all that full of mistakes!

3. Paid off my only credit card balance over 10 years ago (at 21 years old) and haven't had one since.

4. Automatic savings plans. Automatic deduction from my check to max out my IRA at work (with a match from the owner). We also have automatic deductions from our checking for the kids 529's. We never miss the $ because it is gone before we realize it.

5. Living beneath our means. We lived on so little in dental school that none of our friends could believe it! It has continued to this day - DH takes less in salary than he is entitled to so he can buy into his practice faster, thus increasing his overall earnings in a few years.

neatokimmo
08-04-2006, 11:22 PM
For me it was ignoring the bank when they offered a huge amount of $ for my last mortgage :thumbsup2

I bought a small house that was 1/3 the cost of what they were offering and I paid it off in 3 years. At 30 I was mortgage free and I love my house because I've had the extra cash flow to fix it up exactly how I want it :)

Kim

ruadisneyfan2
08-04-2006, 11:54 PM
For us it was:
1. Buying a smaller home than we could afford. We didn't want to be so burdened by our mortgage payments that we would have to stop travelling/saving.

2. We bought it back in 1996 for 1/3 of what it would sell for now. This was just a matter of luck I suppose. No one knew the market would explode a few yrs later.

3. A couple years into our mortgage, we refinanced for 15 yrs. rather than 30. Only 11 yrs. to go and counting down! :hourglass We don't want to be old & gray and still paying a mortgage. :cool1:

MrsPete
08-05-2006, 12:22 AM
For us it was:
1. Buying a smaller home than we could afford. We didn't want to be so burdened by our mortgage payments that we would have to stop travelling/saving.

2. We bought it back in 1996 for 1/3 of what it would sell for now. This was just a matter of luck I suppose. No one knew the market would explode a few yrs later.

3. A couple years into our mortgage, we refinanced for 15 yrs. rather than 30. Only 11 yrs. to go and counting down! :hourglass We don't want to be old & gray and still paying a mortgage. :cool1:Yep, we did that too. We bought our first house while we were planning our wedding -- closed on it two days prior to the wedding. This was not a great choice in retrospect; we were so stressed about the house, getting moved, and combining our things that we didn't really enjoy the wedding as much as we would've otherwise. If I had it to do again, I'd have moved into his apartment after our wedding and started looking for a house THEN. Financially, the house was the right thing to do; it was just too much good stuff happening all at once.

But I digress . . . we bought "less house" than we could've afforded. As newleyweds, we didn't know what the future would bring us. If we'd had surprise twins, or if I'd decided to stay home once we had children, we could've afforded the house on JUST his salary. Buying less house gave us choices for the future.

Also, we took out a 30-year loan, but we paid it on a 15-year schedule (and actually paid it off in less than 15 years -- we made it a major priority). Of course, to make this work, you have to have the right kind of loan. I specifically remember my math teacher making us repeat these words out loud as we studied compound interest: "I want a simple interest loan with no pre-payment penalty."

minnie1928
08-05-2006, 07:53 AM
1. Buying our current home. In 5 years it's increased atleast 33% in value.
2. Getting the lifetime contract on our Tivo. Paid $200 back in 2000, more than paid for itself!
3. Dave Ramsey-inspired us to be debt free (still working on it, but down to 1 car pymt + mortgage)
4. Using Quicken
5. Started saving money in Mutual Funds during my sr. year in high school. Thank you goes to Mr. Burdette, my Economics teacher (one of the best classes I ever had!)
6. Getting in 401k and upping the amount each year when we get raises.

ducklite
08-05-2006, 07:56 AM
Paying my bills on time. This has allowed me to look over extended on paper but still get credit at favorable rates when I was in the process of buying and selling several peices of real estate at the same time a few years ago and had most of my cash flow seriously tied up for a few months.

Buying my NJ house (now sold) during a buyers market at a rock bottom price. It was very basic and had no upgrades at all. Over the nine years we lived there we probably put $20K into it, and sold it for a $200K profit during a sellers market. We also bought a LOT less house than we could afford and had a 15 year loan, gained equity really fast.

Buying my Florida house and making $300K on it in three years--and that's taking into consideration a cooling market, a year ago it would have been closer to $400K.

I had another piece of real estate that I had bought thinking I'd do "something" with it, then took advantage of a smoking market and sold it about 18 months later at a 30% profit.

But without spotless credit I never would have been able to have the successes in real estate that I have. So I guess ALWAYS paying bills on time is number one.

Anne

TenThousandVolts
08-05-2006, 08:35 AM
Stretching ourselves to buy the best house we could afford when we purchased our 1st home. Out of the 3 homes we considered buying- the one we chose trippled in value after 7 years- the others had not quite doubled.

Also- doing the equity accelerator (you pay early and a little extra each month) Just doing that alone we would have our 30 year mortgage paid off in 21 years (but we are on target to have it gone in 9 more years- 17 years total from the purchase date.) Also we have afixed 5% rate and never have/never will refinance.

jay-nee
08-05-2006, 08:59 AM
Getting divorced from my overspending ex-H!

Still doing the happy dance. Now, if only he could pay the CS on time!!!!!

Have a great weekend everyone!

minnie1928
08-05-2006, 10:02 AM
About 3 years ago I got a refi offer from Wells Fargo. No points, no closing costs, nada at 5.25%. I work for a local bank and that was the rate they were offering + closing costs! I did the Wells Fargo mortgage, then once that closed I refinanced my 2nd mortgage with them (lowered my rate from 11.125 to 7.25%!!!). About a year ago I received an offer for a Home Equity loan from a competing bank at 6.24. I called Wells Fargo and told them that I was very happy with their service, but that this rate offer was attractive. They modified my 2nd mortgage down to 6.24% fixed at no cost. I kept my payment the same, but now much more is directed to principal.

barkley
08-05-2006, 11:22 AM
working my way through college so i could graduate debt free.

dh taking a less than glamours job with great benefits that included partial reimbursement for pursing a degree so we could pay for his college as he went.

going with our 'gut feeling' and putting our house on the market back in march. caught the tip of the tail end of the sellers market and will benefit from a buyers market when the time comes. and not being greedy when it came to pricing-set the price a bit lower than competing properties and sold right away (vs. the identical houses that are still sitting months later despite 85K price drops).

did'nt realize it at the time but-choosing to always work full or part time starting at age 16. when out of the blue i became totaly disabled and unable to return to work i learned i was eligible to full social security disability benefits (vs. ssi which is about 25% of what i receive)-all those 'little jobs' contributed quarters to the system.

dh and i buying life insurance when we were young and newly married-much lower premiums and now that we have kids great peace of mind. also bought the kids each one when they were born-minor cost, they'll be paid off before they are likely to wed/have kids-and can provide peace of mind for them when they are responsible for someone other than themselves.

stealthnet
08-05-2006, 11:53 AM
-From ages 16-18, I saved $18k working at a movie theatre for 30 hours a week. I was very careful with spending. Looking back, I should have invested most of it and not used it for a car, however.
-At age 23 last year, maxing out my Roth IRA with $4k. I plan to save 10%+ every year, and will utilize a 401k later this year when I qualify at my job.
-Never paying any interest to credit cards, never late on a payment. Perfect credit.
-Checking fatwallet.com daily. Even without buying anything, I have made well over $500+ just from a couple bonus offers.
-Selling my GM card points during a special bonus period where I was randomly selected. Sold my $5k in GM dollars for $2.5k -- I didn't really need a new car and the bonus points would have expired.
-Worked all through college and graduated with no loans and plenty in the bank. While financially smart, I missed out on some of the social aspect.
-Numerous times of e-mailing either my college or various companies when I am disappointed with the quality of something and getting reimbursed for it. We all work incredibly hard for our money, so when I buy something that breaks unreasonably early, I make sure to let the company know. Additionally, if I have a incredibly positive experience, I e-mail that also. Also, my college was giving me a hard time about a grant I qualified for. I went through the requirements one-by-one in an e-mail and shortly thereafter I was credited the money.

The next goal is a house within two years.


Robert

deltachi8
08-05-2006, 01:17 PM
double down on 11