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What's the worst financial decision you've ever made? (lemmy.world)
submitted 1 week ago by to c/asklemmy@lemmy.world
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Doesn't have to be thousands of dollars. Just a thing you spent money on that turned out to be a complete waste.

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[–] 4 points 1 week ago (4 children)

This is why I don't invest. I tried it for a relatively short span of time. It was a large company that isn't a scam or anything but I can't remember the name of it. They had three sort of options for investing...1. high risk/reward, 2. Medium risk/reward, and 3. Low risk/reward.

I either picked 2 or 3 or something. Can't remember which. All that stupid thing did was lose money due to broker fees. I watched the money slowly drop over the span of around a year from "fees" with literally never earning a dime. I thought it was ridiculous so I pulled the rest of the funds.

I instead chose to place that money in a high yield savings account. Does it earn money quickly? No. But it isn't wildly unpredictable like investing and it will never lose money unless I take money out. Investing isn't for me.

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  • [–] 2 points 5 days ago (2 children)

    With all due respect, what you did was not investing; it was closer to speculating. If your time horizon is less than 5 years, what you should look at is a savings account/certificate of deposit, not the stock market.

    I had a mutual fund once (the Putnam Health Sciences Trust) that went down three or four years in a row (probably about 30-35% total). The same financial advisors who recommend I buy it advised that I sell it for the last two years I owned it. I didn't take their advice and held on to it - the next year it had about a 75% increase. I would have missed that and locked in my losses if I had listen to them.

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  • [–] 2 points 5 days ago (1 child)

    I didn't know 5 years was a cutoff for something be considered investing but ok.

    Yes, you're right. I could have decided to keep the account open for the next 10 years and maybe it might have eventually earned a single penny. But I chose not to because that's just not what I'm interested in. You do you. It's just not as easy and win-win as people make it out to be.

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  • [–] 1 point 5 days ago*

    I instead chose to place that money in a high yield savings account. Does it earn money quickly? No. But it isn’t wildly unpredictable like investing and it will never lose money unless I take money out. Investing isn’t for me.

    Even though I do invest in stocks, until recently I was a long time user of high yield savings accounts for years for my "safe" money. What I eventually realized was how the bank was able to pay me the comparatively higher interest rate for a savings account. Whatever money I had in the savings account they'd just buy short term US Treasuries (probably 4 week Tbills), they shave off .5%-1% interest earned for their company profit, and passed the remainder onto me. I finally sat down and learned how to cut out the middle man and buy the Tbills myself. So instead of the High Yield savings account paying me 3.01%, I'm earning 3.94% on the same money.

    Also understand that Savings accounts and even Tbills usually drasically underperform compared to broad stock index funds. For example 2025 was 16.39% and 2024 was 23.21% returns for boring S&P500 funds.

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