77 Reasons You're Awful at Managing Money

People usually get better at things over time. We're better farmers, faster runners, safer pilots, and more accurate weather forecasters than we were 50 years ago.

But there's something about money that gets the better of us. If you look at the rate of personal bankruptcies, financial crises, bubbles, student loans, debt defaults, and savings rates, I wonder whether people are just as bad at managing money today as they were in previous generations, maybe even worse. It's one of the only areas in life we seem to get progressively dumber at.

Here are 77 reasons why people are awful at managing money.

1. You let your political views guide your investments without realizing that the market doesn't care who you voted for or which cable news outlet you find more honest.

2. Your definition of "long term" is the time between now and the next bear market, whenever that is.

3. You suffer from the Dunnig-Kruger effect, lacking enough basic financial knowledge to even realize that you're making mistakes. People's lack of understanding about things like compound interest and inflation can lead them to believe they're making good financial decisions when in reality they're tripping over themselves with failure.

4. For every $1 raise you receive, your desires rise by $2 or more.

5. You spend lots of money on material stuff to impress other people without realizing those other people couldn't care less about you. You'd be shocked at how few people care where your purse was made or how much noise your car makes.

6. You are unshakably certain about things you know very little about, particularly regarding monetary policy.

7. You have never been able to predict what the market will do next. This doesn't deter you from trying to predict what the market will do next.

8. You don't learn vicariously from other people's financial problems. By the time you get the hang of making smart money decisions, your life expectancy rounds to zero.

9. You think you're young, invincible, and don't need health insurance. Then icy sidewalks, moving cars, and rapidly dividing cells prove you wrong.

10. You get upset when you hear on TV that the government is running a deficit. It doesn't bother you that you heard this on a TV you bought on a credit card in a home you purchased with a no-money-down mortgage.

11. You take out $200,000 in debt to earn a degree in a subject you're not interested in, doesn't offer marketable job skills, and for which you have no intention of working in -- all by age 22. 

12. You're part of the roughly half of Americans who can't come up with $2,000 in 30 days for an emergency, even though you're also part of the roughly 100% of Americans who will need to come up with $2,000 in 30 days for an emergency at some point in your life.

13. The single largest expense you'll pay in life is interest. You'll spend more money on interest than food, vacations, cars, school, clothes, dinners out, and all forms of entertainment. You do this because you don't save enough and demand a lifestyle you can't actually afford. The future owns your income.

14. You're thrilled that the credit card you're paying 22% interest on offers 1% cash back on all purchases.

15. You spent the last five years arguing why Keynesian/Austrian economists were all wrong. The S&P 500 (SNPINDEX: ^GSPC  ) spent the last five years rallying 177%.

16. You think dollar-cost averaging is boring without realizing that the purpose of investing isn't to minimize boredom; it's to maximize returns.

17. You work in a stressful job in order to make enough money to have a stress-free life. You see no irony in this.

18. You're a pessimist in a world where far more people wake up in the morning trying to make things better than wake up thinking we're all doomed.

19. You try to keep up with the Jonses without realizing the Jonses are buried in debt and can probably never retire.

20. You think $1 million is a glamorously large amount money when it's what most people will need to cover their definition of a pretty mediocre retirement.

21. You associate all of your financial successes with skill and all of your financial failures with bad luck.

22. Rather than admitting and learning from your mistakes, you ignore them, bury them, make excuses for them, and blame them on others.

23. You anchor to whatever price you bought a stock for, without realizing that the market neither knows nor cares what you think is a "fair" price.

24. Your perception of history extends back about five years. This leads you to believe things like bonds are safe, the average recession is as bad as 2008 was, and we're in a new normal of high unemployment.

25. You come from a low- or middle- income household, don't qualify for scholarships, and think it's reasonable to attend a private college.

26. You aced your SATs and went to an Ivy League school. You think this qualifies you to be a financial genius without realizing that the single most important skill in finance is control over your emotions, not control over a Greek formula.

27. You say you'll be greedy when others are fearful, then seek the fetal position when the market falls 2%.

28. You worship "legendary" investors whose only real skill is marketing themselves. Their career track record probably lags a money market fund.

29. You think you can be a successful day trader when the hedge fund you're competing with can read a news report, figure out what it means, and place a trade, make a profit, and exit that trade in literally the time it takes you to click on said news report.

30. You let confirmation bias take control of your mind by only seeking out information from sources that agree with your pre-existing beliefs.

31. You think you're too young to start saving for retirement when every day that passes makes compound interest a little bit less effective.

32. You spend a month researching the best washing machine, then invest twice as much money in a penny stock based solely on a tip from a person you don't know and shouldn't trust.

33. You're investing for the next 50 years but get stressed when the market has a bad day.

34. You're willing to work hard for $15 an hour, but too lazy to spend four minutes to fill out your company's 401(k) paperwork that could result in thousands of dollars of free money from matching contributions.

35. You think you're doing great by building up an emergency fund that covers three months of living expenses when the average duration of unemployment these days is more like nine months.

36. You check your brokerage account more often when the market is going up than going down.

37. You size up the potential of investments based on past returns, rather than investments that (A) you understand, (B) have a competitive advantage, (C) fit your goals, and (D) sell for an attractive valuation.

38. You take something as mind-numbingly complex as the global economy and try to distill it down into small, elegant sound bites.

39. You don't respect the idea that "do nothing" are two of the most powerful words in investing.

40. You purchased investments from a guy wearing boat shoes with no socks, a blue shirt with a white collar, or suspenders This rarely ends well.

41. You feel especially smart after last year's 30% market rally without realizing that you had nothing to do with it.

42. You surround yourself with 18 hours a day of live market TV in a game that requires decades of doing almost nothing but waiting.

43. You seek advice from a doctor to manage your health, an accountant to do your taxes, a lawyer to manage your legal problems, a plumber to fix your plumbing, a contractor to build your house, a trainer to help you exercise, a dentist to fix your teeth, and a pilot to fly when you travel. You wouldn't consider doing it differently. Then, with no experience, you go about investing willy nilly, all by yourself.

44. Hindsight bias fools you into thinking you saw the last financial crisis coming. Worse, this fools you again into thinking you'll be able to predict the next one.

45. You think financial news is published because it has useful information you need to know. In reality, it's published only because the publisher knows you'll read it.

46. You forget that the single most valuable asset you have as an investor is time. A 20-year-old has an asset Warren Buffett couldn't dream about.

47. You don't realize that the guy giving advice on TV doesn't know you, your circumstances, your goals, or your risk tolerance. He doesn't really care about you, either. He just wants to be seen on TV.

48. You have a financial plan without realizing that life neither knows nor cares about your plan. Whatever your plan is today, reality will surely look far different tomorrow.

49. You start saving a little bit of money. Great! It's better than nothing, but I see a lot of people who are proud of their savings when in reality it's an infinitesimally small percentage of what they'll need to retire. As the saying goes, "Save a little bit of money each month, and at the end of the year, you'll be surprised at how little you still have." If you think saving 30% or more of your income is insane, run the numbers. It might be close to what you'll need to retire happy.

50. You think it's impossible to live on less than $35,000 a year without realizing that literally 99% of the world does, even adjusted for purchasing power parity.

51. Your definition of a middle-class lifestyle is a 3,000-square foot home, more bathrooms than family members, three SUVs, private colleges, annual trips to Hawaii and Vail, Evian water, and yoga lessons. (Seriously, just stretch in your own living room.)

52. You can't acknowledge the role luck plays when making the occasional successful investment. (Also true when worshiping investors who made one big call that happened to be right.)

53. You suffer from hard-core belief bias. It's the tendency to accept or reject an argument based on how well it fits your pre-defined beliefs, rather than the objective facts of the situation. Pointing out that inflation has been low for the last five years is still met with suspicion by those who believe the Federal Reserve's actions must be causing hyperinflation.

54. You think the hybrid car is a better financial deal because it gets better gas millage, even though it costs $10,000 more than a comparable gas-engine model. You'll probably need to drive for a decade before the hybrid upgrade pays for itself, but in reality you'll trade the thing well before then.

55. You hate finance, think it's confusing, and don't want anything to do with it. You do, however, love money. You see no irony in this.

56. You think the stock market is too risky because it's volatile, without realizing that the biggest risk you face isn't volatility; It's not growing you assets by enough over the next several decades.

57. You've never been to a poor country, robbing you of the realization that the world doesn't care how entitled you feel, what you think is "fair," or what a real financial hardship is.

58. You think blowing money on frivolous stuff impresses people, when in reality it makes you look like an insecure, pompous, jerk. (This is particularly common among young people who come into money for the first time.)

59. You're unable to realize that a 10% return for 20 years generates more money than a 20% return for 10 years. Time can be a more important factor than return when building wealth -- and it's the one thing you have control over.

60. You don't respect the mountains of evidence showing that once basic needs are met, the amount of happiness each additional dollar of income provides diminishes quickly. This causes you to spend most of your life chasing "the number" you think will make you happy, but probably won't.

61. You think paying your financial advisor and other money managers 2% a year seems reasonable, without realizing that it'll probably eat up one-third or more of your long-term returns.

62. You think of the stock market as numbers that go up and down rather than an ownership stake in real businesses with real assets.

63. You think renting a home is throwing money away when for many it's one of the smartest financial decisions they can make.

64. Your investment decisions are guided by what the economy is doing, when the two really have very little correlation.

65. When planning for retirement, you don't realize that your life expectancy might be 90 years or more. Retire at 65, and you could spend more than one-third of your life living off your investments.

66. You're unable to have a good time going for a hike, a bike ride, a swim, reading a book, or anything else that's free (or cheap). Having cheap hobbies is a large, yet hidden, asset on your personal balance sheet.

67. You work so hard trying to make money that you don't have time to think about, or plan, your finances. This is the equivalent to spending so much time buying exercise equipment that you have no time to exercise.

68. To paraphrase Carl Richards, you ignore history, basing your actions on your own very limited experience.

69. You worry about things you can't control, and things that are not relevant to your own finances.

70. You went to college at age 18 not because you were ready but because everyone else was. It's probably one of the most expense things you'll ever do, and you totally caved to peer pressure.

71. You think that not changing your opinion about markets, the economy, and your investments is somehow noble, when it's really just shutting your brain off to the reality that things are always changing.

72. You ignore that how elderly Americans who have seen it all view money is almost the opposite of how most young Americans view money. This goes back to not learning vicariously.

73. You're uncomfortable with the idea that the biggest news story of the next decade is almost certainly something no one is talking about today, and the big stuff everyone is talking about today is probably meaningless.

74. You underestimate how fast a company can go from "blue chip" to bankrupt.

75. You don't realize that when you say you want to be a millionaire, what you probably mean is that you want to spend a million dollars, which is literally the opposite of being a millionaire.

76. You're unaware that the business models of the vast majority of financial companies rely on exploiting the fears, emotions, and lack of intelligence of its customers.

77. You nodded along to all 77 of these points without realizing I'm talking about you. That goes for me, too.

Check back every Tuesday and Thursday for Morgan Housel's columns on finance and economics. 

 


Read/Post Comments (34) | Recommend This Article (130)

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  • Report this Comment On February 10, 2014, at 5:08 PM, XXF wrote:

    We were worse at weather forecasting 50 years ago? As it is I'm not convinced they do much more than stand outside for a couple of minutes, and sometimes not even that, such as when I'm out in the rain and they're telling us there is a 10% chance of showers.

    What a terrifying idea.

  • Report this Comment On February 10, 2014, at 6:44 PM, mikeb2558 wrote:

    This article is brilliant. I'll email it to my daughter and friends. After 30 years of picking my own stocks, I just calculated that I under-performed the market. Don't let your ego get in the way of securing your family's future. If you can't beat the market after 5 years, put your money in index funds and only make changes once a year.

  • Report this Comment On February 10, 2014, at 9:19 PM, chowdachief wrote:

    #43....isn't this contrary to what the Motley Fool preaches....you don't need to pay a financial advisor handle your financial future. I guess the willy nilly part is the qualifier.

    In general, Morgan, (and this is an honest question) it seems as if you're stance on financial markets is that time is your only friend, you can't predict the future, so invest in index funds and wait. I don't necessarily disagree with you. But a natural question I would have then is: doesn't the Motley Fool contradict this approach? The majority of other articles on this site are specific reasons why one specific company is better than another. I also get constant emails from the Motley Fool about how I should pay for a service b/c riches are in my future if I do (a slight paraphrase). Just a thought...

  • Report this Comment On February 10, 2014, at 9:25 PM, TMFHousel wrote:

    chowdachief,

    Thanks for the comments. I own both individual stocks and index funds, probably about 50/50 right now. I think that's the best explanation of how I feel about investing -- what I own. I buy individual stocks when it's particularly compelling to me. Otherwise, I dollar cost average into an index fund.

    The whole founding idea of TMF is that we're all here learning, teaching, and helping each other. I don't think it's contradictory at all. The people who end up in the most trouble, in my view, are those who really just try to go at it alone, by themselves, feeling it out as they go and learning the hard way.

    Thanks again,

    Morgan

  • Report this Comment On February 10, 2014, at 9:32 PM, TMFHousel wrote:

    Although -- and maybe this is a rebuttal to my own point in #43 -- the most valuable lessons I've learned in finance have come from people who don't work in finance. So let me reiterate that getting help is not always the same as hiring a formal financial advisor (especially if he's really just a salesman).

  • Report this Comment On February 10, 2014, at 9:38 PM, KBOKSOFT wrote:

    ...you read the phrase "Dunnnig-Krueger effect" without clicking the link to see what it is, or realizing it is misspelled.

    (Couldn't resist.)

  • Report this Comment On February 10, 2014, at 10:46 PM, neamakri wrote:

    76. You're unaware that the business models of the vast majority of financial companies rely on exploiting the fears, emotions, and lack of intelligence of its customers.

    Last week a person at my bank tried to convince me to move my IRA to him. Most of his sales pitch relied on fear phrases. It didn't work.

    This morning a man from Schwab (my IRA account) called to sell me on letting him run my account (for 2%). Guess what? I have done really well and don't need his help at all. Mostly 'cause I'm smarter after reading The Motley Fool!

  • Report this Comment On February 10, 2014, at 11:03 PM, FutureMonkey wrote:

    "Human beings, who are almost unique in having the ability to learn from the experience of others, are also remarkable for their apparent disinclination to do so." -- Douglas Adams

  • Report this Comment On February 11, 2014, at 8:35 AM, pondee619 wrote:

    "43. You hire a doctor to manage your health, an accountant to do your taxes, a lawyer to manage your legal problems, a plumber to fix your plumbing, a contractor to build your house, a trainer to help you exercise, a dentist to fix your teeth, and a pilot to fly when you travel. You wouldn't consider doing it differently. Then, with no experience, you go about investing willy nilly, all by yourself"

    "61. You think paying your financial advisor and other money managers 2% a year seems reasonable, without realizing that it'll probably eat up one-third or more of your long-term returns"

    "76. You're unaware that the business models of the vast majority of financial companies rely on exploiting the fears, emotions, and lack of intelligence of its customers"

    So, we all need a financial advisor without paying a common rate and not getting exploited by the "vast majority". Perhaps the article should just be on picking this rare (in the vast minority) cheap and competent person/firm.

  • Report this Comment On February 11, 2014, at 9:04 AM, pondee619 wrote:

    Also, you said:

    " So let me reiterate that getting help is not always the same as hiring a formal financial advisor (esspecially if he's really just a salesman)."

    No need for a "formal financial advisor" with all those cab drivers, barbers and cocktail party attendees, etc. around. Would you use a "non-formal" doctor, pilot, accountant, lawyer, dentist et. al.?

    We hire a professionals to do all the other work in our lifes but not in investing. But in investing we don't need a professional? Maybe because you just realized that you were tellilng people to avoid your employer? But aren't you, and the other fools just "salesmen"?

    " Enter your email address below to find out how YOU can take advantage!"

    "But I’d rather not go on my million-dollar quest alone… so I’m inviting you to join me"

  • Report this Comment On February 11, 2014, at 1:51 PM, stockdissector wrote:

    Morgan,

    Most of what I learned about personal finance such as saving more than you earned and having enough money to get you through hard times came from my 8th grade educated grandfather who lived through the great depression. (Although he didn't trust stocks). So I understand that financial wisdom can come from the most unlikely places.

    Liked the article. Good stuff.

    Fool on!

  • Report this Comment On February 11, 2014, at 2:29 PM, alexf wrote:

    Excellent article to spread around to friends.

    Well written Morgan!

  • Report this Comment On February 11, 2014, at 5:13 PM, funkyduane wrote:

    I really mean this - I love you Morgan! You reliably get to the heart of the issue for us human beings when it comes to money.

  • Report this Comment On February 11, 2014, at 6:13 PM, kyleleeh wrote:

    The irony of number 49 is that if everyone actually did this, in an economy that is 70% consumer spending, the stock market would tank, and millions of us would be laid off.

    I wrestle with this moral dilemma when giving people financial advice. It's good for me to save 30% of my income and invest it in stocks, but it's also very much in my interest to have everyone else spend every penny they make on things they don't need, stay in debt forever, and die penniless. That kind of lifestyle is great for stocks.

  • Report this Comment On February 11, 2014, at 9:15 PM, HighVoltage627 wrote:

    14. You're thrilled that the credit card you're paying 22% interest on offers 1% cash back on all purchases.

    I would gladly take a credit card that charges a 100% annual interest rate if it gave me 10% cash back. Why? I keep my credit card paid off every month, so I don't really care what the interest rate is.

    I tell this to people every so often, and they usually look at me like i just kicked a puppy.

  • Report this Comment On February 11, 2014, at 10:00 PM, stockdissector wrote:

    Good one HighVoltage 627

  • Report this Comment On February 12, 2014, at 1:52 AM, RxPro wrote:

    "5. You spend lots of money on material stuff to impress other people without realizing those other people couldn't care less about you. You'd be shocked at how few people care where your purse was made or how much noise your car makes."

    Not sure if you're married, but my wife talks about this stuff regarding others all the time and it drives me crazy. I have to remind her that money in the bank is worth more than a (financed/leased) BMW on the road, but I'm not sure it doesn't just go in one ear and out the other.

    Good list though, I think we all can take away something here. I'll add one if you dont mind:

    78) There are no style-points in investing. Trying a new "market beating" strategy might seem fun, but it will probably end up costing you.

  • Report this Comment On February 12, 2014, at 7:47 AM, Pjstew wrote:

    kyleleeh. Agree with you. I've thought about this a lot too.

  • Report this Comment On February 12, 2014, at 11:36 AM, RiReynolds wrote:

    No additional comment required - excellent article and great comments

  • Report this Comment On February 12, 2014, at 11:53 AM, atkinskd wrote:

    Mentorship. I had none until the age of 33 after a stint of unemployment, a divorce that went on to last 4.5 years of $1800/month avg in legal fees, While trying to start over, take care of my two kids, and survive. A coworker took me under his wing and explained to me how EXACTLY compound interest works. 33 years old and had no idea how the most powerful equation worked. Something that should have been taught in my Jr. High School Home Ec class and every math concepts class through college - I encountered only once, in community college, briefly during an accounting course. I have an engineering degree.

    My mentor taught me about investing, how to choose stocks and coached me through my first stock purchases. Happily my IRR is near what my credit cards used to charge thanks to my mentor. If I had invested a gift from the in-laws early in my marriage as one peer suggested - I'd be past my first million already. Now I get to try and duplicate it without the virtue of said gift or the time to let it grow.

    My parents had way more month and than paycheck left growing up. Investing was legalized gambling. And the investing industry is more than happy to allow the public to foster these sentiments.

    Yeah, kids these days suck at math and what are seemingly obvious math topics to the select few of us taking the bull by the horns...even the 30 somethings like me are without a clue.

  • Report this Comment On February 12, 2014, at 12:08 PM, bruguera wrote:

    I agree with most of this, but wouldn't that $1 million you talk about in #20 be a "glamorously large amount of money" for the vast majority of the planet?

    And couldn't we alter #50 to read: "You think it's impossible to live on less than $1 million for your retirement without realizing that literally 99% of the world does, even adjusted for purchasing power parity.

  • Report this Comment On February 12, 2014, at 12:38 PM, kahunacfa wrote:

    Of the seventy-seven points you mentioned perhaps only one applies to me: I have about four or five trades per year in all of my personal accounts. That is probably too many transactions with the new money flowing into tax-sheltered IRA accounts -- the ONLY accounts I invest in.

    Learned to invest with the best at the University of Wisconsin Applied Security Analysis course <UWASAP.org> in the nineteen-seventies. Earned an MS in Finance & Economics 1976 and became an Investment professional in 1974.

    Kahuna, CFA

    Investment Professional

    1974 - Present

  • Report this Comment On February 12, 2014, at 2:50 PM, RxPro wrote:

    @bruguera, $1M should certainly be enough to live off of if you are following the 4 or 5% per year rule, plus as of now social security still exists so thats a plus.

    @kahunacfa, maybe another tip should be, "You only invest in IRA accounts, because what could you possibly need money for before you turn 59.5" This is especially true now, considering most households investment accounts would be TAX FREE.

  • Report this Comment On February 13, 2014, at 9:17 AM, Mathman6577 wrote:

    @kahunacfa made a good point: Minimize trading to both save transaction fees and (probably) losing money trying to time the market. Buy and hold will work out. I have done it for 32 years (you'd be surprised how it works).

    I think three to four accounts are needed (depending on age and retirement date):

    1. Emergency fund in an insured money market fund (even if paying only 0.4% per year) (9-12 months living expenses),

    2. 401k (or traditional IRA if not offered): max it out if you can to reduce taxable income while working (or get into the savings habit). Putting most of it into a "stable value" fund or index fund is the best thing you can do.

    3. Roth IRA (if you will be in a higher or the same tax bracket when you withdraw the money)

    4. Taxable brokerage account (holding your dividend stocks if you need some income in retirement before age 59 1/2)

  • Report this Comment On February 13, 2014, at 6:25 PM, foolwhoissmart wrote:

    Absolutely brilliant! I chuckled all the way through!

    Here's point #78 in your crazily-brilliant list:

    Don't waste your time commenting online, or bragging about any of your virtuous investment or lifestyle habits!

  • Report this Comment On February 13, 2014, at 6:30 PM, tchams wrote:

    My fiancée would be very upset to hear that you are calling yoga stretching in rule 51!

    Fortunately for you, she would get bored and stop reading after rule 5 (if I forced her to read any of it at all) so you have nothing to worry about.

    Great article as usual.

  • Report this Comment On February 13, 2014, at 6:41 PM, Mathman6577 wrote:

    @foolwhoissmart: it's not bragging if you can help someone out. Not everyone can do it themselves.

  • Report this Comment On February 13, 2014, at 7:07 PM, scottwilson wrote:

    MANAGE MONEY MY FANNY-----TOO OLD TO CARE-----MY FUNERAL IS PAID LONG AGO....

  • Report this Comment On February 13, 2014, at 7:18 PM, KayakerRW wrote:

    @atkinskd,

    Good point about teaching kids in school about compound interest. My school actually taught a class in consumer math that focused on topics such as computing interest (both for borrowing and investing).

    Then came the standardized testing craze, with the idea that every student must pass the Algebra standardized test, so out went consumer math.

    States are now starting to require classes in personal finance, but they are often too shallow. Even worse, some rely on playing investing games that encourage lots of trading.

    Several years ago, a Fool article stated that students should be taught to analyze a balance sheet and a poem. I agree, and think that having students graduate with a solid knowledge of how compounding works is a more valuable math skill for most students than giving them a cursory (and quickly forgotten) knowledge of algebra.

    [Note: I have no opposition to teaching advanced math, especially to students who enjoy it and plan to enter careers that will require it].

  • Report this Comment On February 14, 2014, at 2:17 PM, Haggy wrote:

    I'm "guilty" of two. At least I think I am. I might have paid more in mortgage interest than in other expenses, but considering that by every measure mortgage interest comes out to a very small fraction of what I earned by investing, I'd be far worse off if I hadn't. I'd be able to pay off my mortgage many times over, but with mortgage rates under 3% and with most people keeping them for 30 years it's unlikely that most people would be better off paying off their homes even if they could afford it. I'd be a lot worse off had I not had mortgages.

    The other point is checking my portfolio more when the market is going up rather than when it is going down. I think the biggest problem is that many people do the opposite. When the market started to tumble in 2008, lots of people took their money out at the bottom, seeing the market going nowhere but down. They wanted to get out before they lost everything, even though the individual investments might have been in sound companies with good business and good growth. I started on a period where I hardly checked stock prices for years, and hardly made any trades at all. Perhaps I made one or two trades a year because I felt my "buy and hold" stocks were in good shape. Had I looked at my returns more often, and panicked each time I saw them, I could have made what would have been a million dollar mistake.

    On the other hand, watching your money go up shows you the reward for staying put. If you do so after a long bear period and watch the money come back and grow higher than ever, it feels great. I know what it's like to hear people boast and brag about their returns when everybody else is doing great. Those same people suddenly shut up during bear markets. Being quiet all along (except perhaps for largely anonymous posts) and riding things out makes you realize that you would have something to boast about. But then your friends would be buying things based on your stock tips (they will beg you for them) instead of buying anything they understand and will panic as soon as they get a month like the one that just ended. There's no need to impress your friends. The most it could do is make them feel worse about themselves.

    Not everybody who wants to be a millionaire wants to spend more than they have. Not everybody who becomes a multimillionaire did so because of an explicit goal, but rather some did so with good sound planning and living a life that's comfortable.

    There's nothing wrong with a 3000 square foot house, especially when you can afford one many times bigger. I can only be in one room at a time, and each one must be big enough for its purpose and no more.

    We hear so much about the top 1% these days. But if you try to figure out what that means, it goes by what a person earns, not what a person has. A person who retired at 40 and has seen millions in dollars of growth since that time through careful investing doesn't count. But being able to afford to live a comfortable life past age 100 and anticipating having a lot left to leave to your children is a great feeling.

    My kids are still in college. I set up Roth IRAs for them. They pay no taxes since they have little income, so they will get tax free growth. I showed them how adding a mere $200 per month will give them millions of dollars at retirement, but also made it clear that I don't expect that to be their only retirement income, The point was to start early and be fine with not touching the money until an age that is so old that it's beyond imagination to a teenager. They can't make the mistake of spending millions rather than saving it, but if they do, it will be because they have many millions more.

  • Report this Comment On February 14, 2014, at 5:57 PM, dpp1035 wrote:

    #78 You laughed out loud at several of the items on this list (the ones you aren't guilty of) but glossed over several others quickly without laughing (the ones you ARE guilty of)

  • Report this Comment On February 15, 2014, at 9:51 AM, Truth2Power wrote:

    Gotta disagree with #70: ready or not, college at 18 makes more sense than the alternative: working a job you can get with just a HS diploma! Of course, there are alternatives like the Peace Corps or the military, but considering one needs to start planning at age 17 or 16 for college, I wouldn't recommend waiting until "you're ready."

  • Report this Comment On February 16, 2014, at 11:27 AM, utmthew wrote:

    to Rxpro, you are right on the money about no.5

  • Report this Comment On February 16, 2014, at 7:58 PM, lowmaple wrote:

    If you plan to go to college it would be important to pick the correct courses for you..... Also, a year's work would help your finances(if you saved). When l went one could do that and

    l would be that much better off now. Problem is of course to have the will to go back to academics.

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