financial regret

My Biggest Financial Regret (And How to Avoid Making the Same Mistake)

Generally, I try to avoid feeling or focusing on regret, especially financial regret. The past is behind us; we can’t change it, so why feel bad in the present? Dwelling does no one any good.

But I also believe that we can learn from our past and use the lessons, mistakes, and actions to propel us forward. Where we’ve been can help steer us towards where we want to go.

financial regret
financial regret

My Biggest Financial Regret

For me, my biggest regret is easy to identify.

Not investing while paying off my student loan debt.

My debt was Regina Georging my life; it was a life ruiner. To me, my debt was a signifier of every wrong choice I’d made in life.

  • I had taken out the debt to get a degree I wasn’t using.
  • I was the only one of my three roommates who had student loans, which made me feel like a loser
  • So, I was low-income and struggled to make my debt payments, which made me feel hopeless about ever paying it off

So when I got serious about paying off my debt I focused ONLY on paying off my debt. I was 100% devoted to debt freedom. Anything else could wait, including investing.

Why I Regret Gazelle Intensity

Dave Ramsey calls the focus I had “gazelle intensity,” and it’s something he recommends.

I mean, first of all, I don’t like to associate with Dave Ramsey because of his general misogynist attitude and lack of empathy for people. But I also think gazelle intensity, for me and many others, can be missing the forest for the trees.

What I mean is: only focusing on my debt DID allow me to become a budget ninja and pay off my debt quickly. But it also cost me time in the market that I will never get back.

Like, never.

It took me three and a half years total to pay off my debt and that is three and a half years of time in the stock market (during the longest bull market in US history I might add!!!!) that I will never, ever get back. Time is the one thing that we can’t make more of.

Time Really Is Money For Marginalized People

“Time is money”, the finance bros love to yell. And, God help me, THEY’RE RIGHT!

I come from a low-income background, and have been low-income for most of my life. Budgeting is amazing, but growing wealth comes from investing.

Adding a missed three and a half years on top of that lifetime of low income, plus a lack of generational wealth and no inheritance, and time becomes a hell of a lot MORE important to me and people like me.

When you have family money, a high-paying job, or a stable or wealthy partner, you have something to fall back on.

Without those things, you just have yourself and your money decisions. My decision to not invest while paying off debt is one that cost me money, even as I was doing something good for my money. Two things can be true!

Investing While Paying Off Debt

The other part of my financial regret is that investing while paying off debt doesn’t have to be that complicated!

I was low income, but I absolutely could have invested $50 a month starting at 23. I estimate I would have about $5,000 more right now if I had invested earlier.

While that’s not life-changing money, consider that that’s just at age 33. That $5,000 I missed out could have grown in the market over the next 30 years, and become tens of thousands of dollars.

Le sigh. Hence the financial regret.

If I had to do it over again, here’s exactly what I would have done:

Opened a Roth IRA at age 23

Contributed $50 a month to an index fund with no minimum purchase requirement

Sat back and watched my money pile up

(You can learn how to get started investing with our super popular class “How to Not Die Broke: Investing 101” right here.)

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9 thoughts on “My Biggest Financial Regret (And How to Avoid Making the Same Mistake)”

  1. The pain of opportunity cost is real!

    I can empathize. A lack of understanding of what to invest in, meant I ‘invested’ in overpaying a mortgage. Its painful.

    We can’t change the past. But we can change the future.

    1. Yes it is real! It doesn’t keep me up at night but I think there’s power in looking back and sharing, out loud with others, what we wish we knew then.

    1. I think if you have a really smal amount of debt you can knock that out in a few months and then invest, but that’s just not the case for most people so yeah, I’m team do both!

  2. Bravelygo, mistakes are human and as you say, recognizing them so you can learn is a powerful skillset. However, I wouldn’t let it eat at you, as many in the FIRE community pay off their mortgages early. In such a low interest rate environment it makes no sense to do this, as 15 to 30 years from now is nearly guaranteed to see higher stock prices. Nonetheless, this is applauded by many since it reduces lifestyle expenses. Taking the same intensity and investing in the market now that you are debt free will only reward you with time!

    1. No need to worry, I don’t sit around wallowing in regret! I’ve been debt free for 6 years so plenty of investing has taken place 🙂

  3. yes, 35 yrs ago when I was starting out and there were no financial blogs etc. I kept asking should I pay off debt or invest and/or both. Never found a concrete answer. Obviously now it is to do both. Yes, now the answer is out there and easy to see how you reap the compounding rewards. But let go of the regret-it doesn’t help, but know when faced with another dilemma…to seek out more possibilities.

  4. I have the exact same regret–especially with the benefit of hindsight! While it was nice to get out of debt, I missed out on some HUGE gains in the market compared to some relatively small loans (mostly around 5%). Problem was, I had no clue what to invest in. I was a late bloomer to discovering just how easy it can be thanks to index funds.

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