I'm a firm believer that it's important to be open and honest about money. In the past, talking about things like how much you make or the debt you're dealing with may have been taboo, but being transparent and able to discuss these things is actually really important. It's not easy to negotiate a salary or a raise when you have no idea what your peers in your field are making, for example, and if you're dealing with debt you might be missing out on options that could help you repay it more easily simply by not talking about it. And in many cases, not only is the discussion not happening, but the education people need simply isn't there.
I remember taking a consumer economics class in high school that was both mandated and largely unhelpful, not because I didn't understand the subject matter, but because aside from the section that taught us the basics of a budget, the class covered the least helpful financial topics—at 16, I didn't need to learn the inner workings of the stock market, I needed to learn how student loans worked (something my family really couldn't help me with because I was the first one to go to college), how to responsibly handle a credit card, and how to do my taxes. I didn't learn those things in that class, but for the things I did learn, I'm lucky—many people don't even have a class like that to take in the first place.
So, in the spirit of being open and honest about money, I asked people to anonymously share the biggest money mistakes they ever made and what they learned from them or would've done differently. Many of the people who responded also expressed that their money missteps came from a lack of knowledge and understanding about how certain financial things worked, and how frustrating the lack of education around them is.
"I took out 4 credit cards from the ages of 18-21. I was young, and I had been working 2 jobs through out that time while also going to school full time. All of the credit cards I was approved for had what I thought were high limits ($2,000+). And I quickly maxed each of them out. I'm almost 26 and still paying them all off. I still owe almost the entire amount on these cards too, so I've basically just been paying off the interest these past 7ish years. It was a huge mistake, because now I'm constantly stressed out about money, even though I now work a decent salary job. If I could do it differently, I would have never taken any of them out. But it was tough, because I needed them to make repairs to my car and pay for food and prescription medications and my school tuition. So, I wish I wouldn't have taken out so many credit cards or maxed them out, but at the same time I kind of felt like I had no other choice."
"So, in college, my parents paid for my rent and I put all my schooling on student loans. My roommate and I moved into a very nice apartment near campus, care of our parents, and only had to pay for utilities. We didn't know to inquire about the varying price of all-electric utilities, and long story short, come winter, we owed the electric company $1,000 and they turned off our electricity. I had credit so we had to take out a credit card in my name to get $1,500 so the electricity would turn back on. Every time the bill was too much, we'd charge it. My limit was generously $7,500. We were only paying back the minimum, interest was amounting to about what we paid back a month. After 2 years in that place, I left college with $60,000 in student loans, and $7,500 in credit card debt. My roommate and I still only pay whatever we can to make the minimum for the credit card and it's just another bill that we both have, and will have for 5 or so years to come. If I could go back, I would have tried harder to figure out government aid programs...but with full time work and school, I just didn't have the time. The government programs were purposefully time consuming and confusing, so I chose the easier and more damaging route. I am a living example of why financial education NEEDS to be taught, and shared with other people. I'm by no means underprivileged and I still fucked it up, super bad."
"Probably not making a student loan payment until my 6-month grace period ended. It was a mistake because I didn't realize interest was still accruing on the loan, so after 6 months I ended up having to pay an additional $2,000 that got tacked on the principle. If I could do it differently I'd definitely make monthly payments on the interest at least to save myself money."
"Once upon a time, I forgot to return a WiFi router and fucked up my credit score. It got sent to collections! Over like, an $80 piece of equipment that I just forgot to send back to Cox. But being 22, I decided the best thing to do was ignore this for a very long time. It was only really bad for my credit score because I had very little credit history to begin with, so having ANYTHING amiss was a big deal. Anyway, the router was long gone, but I paid Cox their $80 and got a credit card. Now my credit score is good again, thank goodness. The other thing is that collections phone calls sound like fake phone calls, or rather, a lot of junk phone calls try to make themselves sound like collections. My first thought was, 'Who are these financial people calling me? That's not the name of my bank.' I basically gave myself plausible deniability that this was even a real thing until I checked my credit score, because I was like "I keep getting these weird phone calls but they're probably junk I guess.'"
"In 2011, I turned down a full-time job to attend grad school. The job was at the humanities research center I'd been working at part-time throughout college, and offered fair pay and good benefits. I ended up having to drop out of grad school less than a year later because I couldn't afford it. Those 1.5 semesters left me saddled with debt that's wrecked my credit score, prevented me from ever receiving my tax return, and made me ineligible for federal funding if I were to try to go back to grad school (or to law school, which is something I've wanted to do since 2013). At the time, we were still coming out of a recession and so many roles had Master's degrees and internships as "desired" qualifications. Because I'd had no choice but to work to put myself through school, internships hadn't been an option and a Master's seemed the only way to have a shot at upward mobility. So I don't necessarily blame 22-year-old me for making that decision, but 28-year-old me still thinks most days about what life would be like had I taken that full-time job right out of college."
"My biggest money mistake is complicated because it's simultaneously the thing that forced me to learn how to be financially responsible. At 18 years old I left an abusive family situation and decided to go to college with nothing but a really meager savings account and hope that I could somehow put myself through 4 years at a private university. I had absolutely no plan and it took me about a year and a half to truly get on my feet and learn how to save, spend, and earn money while also paying bills. If I could go back now and do things differently I would plan better and learn how to budget sooner so that I wouldn't spend so long sometimes going without enough food just to be able to pay tuition. But ultimately it still taught me how to deal with personal finances, if only in a really tough way."
"Probably lending people money. You lend people any significant sum of money and then you find yourself scrutinizing every move they make afterward while you wait to get it back. I once loaned an ex-roommate something like $2,000 so he could buy a crappy beater car to drive around so that at least he'd have wheels. He turned out to be a nightmare of a roommate and would blow his paychecks on things that were not paying me back and sometimes not even for paying his half of the bills, and less than a year later we were no longer living together or speaking to each other at all. I think I got $500 of that $2,000 back. I was probably about 19-20 at the time and it was my first time living away from my parents' house. I have another friend that I loaned a smaller sum of money to (I think it was like $400 so she could make her car payment that month) and then over the course of the next year she proceeded to start saving up money to go on a trip to Germany with another friend of ours. I eventually got the money back but she couldn't come up with it again until she started university again that year and she did it out of her financial aid funds. But yeah, I lent her money and then got to watch her prioritize her European vacation before making good on what she owed me, and that really made me mad. I was a little older for that one, probably 22 or so. I actually am still friends with her, but it was a really big strain on our friendship for awhile. If I could change it or do it differently, I definitely never would have lent my old roommate the money for the car. And being in the 'older and wiser' camp now, I probably still would have helped my friend with her car payment and just mentally noted that it was more of a gift than a loan."
"My major financial issues in life all stem from my college loans. The way I went about them pretty much put me in financial hardship for the next twenty years. I am not talking about small loans that are annoying—I mean I will end up paying well over $200,000 for a four-year private school and start every month at least $1,000 in the hole. This was my biggest mistake, and mainly the result of being naïve and uninformed. I was the first child in my family to go to a private school, and the workings of it were totally foreign. Neither of my parents have good financial habits when it comes to saving and debt, so I went in completely blind. I took out whatever loans the companies told me to (all but one year were solely in my name), and ended up with a hefty amount of private loans with outrageous interest rates. My mother did most of it since I was only 18 and was having a difficult time filling things out and I was under the impression that when I graduated I would have financial help from my family, which I do not. Sophomore year I almost transferred, but was reassured it would be fine, and it turns out I should have transferred. Although I love the experiences I had at school and the friends I made, in hindsight I would have done a lot of things differently. First I would have gone to community college for all of my general education classes and paid those off as I went. When I would eventually transfer, although I still would've wanted to go out-of-state, I would have been much MUCH more particular about the financials. I have paid off around $70,000 since graduating in 2012, so going to a public school most likely would have afforded me an easier life where my loans would be paid off by now. I have a very well-paying job that I credit partially to my education, but I know I could have found similar a similar education at half the cost."
"My financial mistakes are generally small but they add up. Like buying people gag gifts that they won't ever use, getting tickets to things and not going. But also not paying quarterly taxes. I need to talk with someone about how to set that up. I couldn't afford to pay my taxes last year so I had to ask my parents for money which made me feel incredibly guilty. Also I never learned how to budget, so trying to self discipline when it comes to spending has consistently been a problem for me. Like thinking I can afford to buy coffee every day, especially iced coffee or nitro. In New York, that's $4.50 a pop at some places and if I stay there for a while I end up getting two, so there have been days where I spent $10 on coffee alone. Buying a cheap coffee maker and good beans saves so much money."