What Will These 3 Mistakes Cost You?

One afternoon when I was 14, my father did something crazy.

At the time, I thought I was being punished -- but looking back on it, I realize he was just trying to keep me from making two very costly mistakes.

The most important thing in life
For you, it might be your family, your career, a sport, or even a hobby. For me, at 14, it was Kelly Kapowski -- a beautiful, brunette cheerleader who starred on a teeny-bop TV show called Saved by the Bell.

So you can imagine my dismay when, in the middle of my favorite episode, dear old Dad unplugged our TV, dumped a pile of books in my lap, and dropped this bombshell: If I wanted to go to college, I'd have to start learning about investing right then and there.

Reading a bunch of investment guides (including one authored by two "Fools" I would one day end up working for) didn't hold a candle to watching the lovely Kelly Kapowski shake her pom-poms. But the TV wasn't going back on until I finished them, so I did -- without really paying any attention to anything I read.

Hindsight is a cruel 20/20
Thankfully, even though I blew off the idea of investing, my old man didn't -- I ended up with a college degree and without any student loans to pay off. But I kick myself every day for not starting to invest my own money back then.

Of course, I never would have thought twice about working all summer so I could drop a grand on a computer, trendy clothes, CDs, and video games, or a hot new item known as a "cellular telephone," but I wouldn't have dreamed of dropping that same grand to buy stock in any of my favorite companies. Big mistake.

Had I taken $1,000 and invested it in Apple back then, right now I could buy an iMac, iPod, and iPhone -- and take them with me on a two-week yacht trip around St. Bart's.

And while $1,000 could have bought me quite a stack of pre-frayed jeans and plaid shirts back then, had I invested that money in American Eagle, right now I'd have enough to pay my rent for a full year -- with plenty left over to pick up some designer denim in Paris.

And just look at how a few of my other favorite companies performed.

Source: Yahoo! Finance. All figures assume dividend reinvestment.

The bad news ... then the good
Despite my dad's best efforts, I ended up falling prey to the same two costly mistakes that tens of millions of other hard-working people are making right this minute:

1. Spending all of your money, without investing any of it.
2. Waiting too long to start investing.

The good news is that if you've never invested, aren't fully invested, or just want to put more of your hard-earned money to work, today is a great time to grab the bull by the horns and take control of your financial future.

The recent market meltdown has left literally hundreds of companies selling for pennies on the dollar -- yet their businesses are as rock-solid as they have always been, and they should continue to build shareholder value for decades to come.

The third mistake: Buyer beware!
That's not to say that every company selling at drastic discounts is worth your hard-earned investment dollars. Let's not forget about some of my other favorite companies from the Saved by the Bell years, including Six Flags and Circuit City.

Ouch! It's "opportunities" like these that make doing plenty of research and having a well-thought-out plan so important in today's tumultuous market.

It's also why I keep a close eye on what the analysts behind our Motley Fool Million Dollar Portfolio service are looking at. After all, they have been entrusted with $1 million of The Motley Fool's own money, and are hard at work building a best-of-the-best long-term portfolio. Among their top picks for new money are two companies you might want to look into: Infinera and Markel.

The first is a tiny company whose products allow companies like Level 3 Communications, Cox Communications, and Qwest Communications to optimize their fiber optic networks. The second is an insurance company with a brilliant chief investment officer, Tom Gayner, who uses the company's float to buy undervalued investments and grow their capital at market-beating rates. Will it be the next Berkshire Hathaway (NYSE: BRK-B)?

You be the judge ...
You can learn more about both of these companies, as well as every company on our Million Dollar Portfolio scorecard, by putting your email in the box below.