Your biggest financial blunder may not be stock you bought that subsequently tanked, or the time you chose not to sell an overheated stock at the peak of its valuation. In fact, your worst stock mistake may be something you never did in the first place.

The hall of shame
I still cringe when I think about the money I've lost on investments such as General Electric (NYSE:GE) and the cement company CEMEX (NYSE:CX). And I'm still kicking myself for letting my $3,000 investment in America Online surge to $210,000 -- and then watching most of that gain evaporate. But the worst error I ever committed, when I look back on it, was my failure to start investing soon enough, nor to pick the right companies when I did.

I'd already heard about Warren Buffett during my days at business school in the early 1990s, but I didn't invest in his company then. If I had, I'd have enjoyed a 10-fold return. A $3,000 investment would have become $30,000. Those who were smart enough to invest with him back in 1965 would have earned an annual average of more than 20%, turning a $3,000 investment into millions!

Back in 1989, I wasn't earning much, but I was still accumulating thousands of dollars -- in my checking account. Look how $3,000 would have grown if invested in some not-so-obscure names over that period:

Company

20-year average annual growth rate

$3,000 would have grown to

Dell (NASDAQ:DELL)

33%

$875,000

Amgen (NASDAQ:AMGN)

21%

$131,000

Staples (NASDAQ:SPLS)

20%*

$101,000

Nike (NYSE:NKE)

17%

$72,000

Walgreen (NYSE:WAG)

16%

$55,000

Data: Yahoo! Finance.
*19-year growth rate.

Of course, we can't know exactly which companies will gain the most over time. But if we don't even bother to look for the best companies and the best bargains we can find, we'll likely end up regretting the big gains we missed. It often takes many years to build true wealth. Don't make the same mistake I did -- get started as soon as you can.