My 3 Biggest Financial Mistakes

Last week, one of my favorite bloggers, John at Frugal Rules, posted about 7 money mistakes he can’t believe he’s made. Prior to reading his post, I had already thought about dishing to you guys about some of the dumbest money moves I’ve made in the past, but John’s post inspired me to finally go for it.

I found it refreshing to know that one of the bloggers I look up to has made money mistakes in the past. It makes him seem more real and makes his advice more believable since now we know that he’s made mistakes in the past too.

Anyhow, here are 3 of my biggest financial mistakes to date.

(That’s not to say I won’t still make big financial mistakes in the future though as I’m still learning more about personal finance everyday.) 🙂

Making Myself House Poor

Although I love my house, I definitely regret making myself house poor due to my impatience. After I graduated from college and moved back to my hometown to start my full-time job, I struggled to find a suitable place to live. I definitely didn’t want to live with my parents again after being on my own for the past 3 years, so I decided to look for places to rent or buy.

Unfortunately, the rental prospects in my hometown are nil to none, thanks to a terrible housing shortage, and so I decided to pursue buying a house. Originally, I wanted to stay under $100K (it is doable in my rural hometown as housing prices are very low here), but after viewing all the houses in that price range, I didn’t find any that I actually like that I’d be able to move into without having to put a lot of work into them first. So I ended up buying my house at the top of the limit given to me by the bank, $120,000.

My house is nice, its new construction, but that doesn’t mean there’s nothing that needs fixed up or re-done. I also had absolutely no down payment money saved up and I couldn’t even pay for the closing costs of the home. I ended up borrowing a 100% loan via a government program for first-time homebuyers, and my parents loaned me the money for the closing costs.

Buying Sooo Many Clothes

As much as I’d like to say I no longer like being fashionable, shopping, or having new clothes, it’s not true. I still love having a large wardrobe so I can mix and match lots of my clothing and it seems as if I’m never wearing the same outfit twice (thanks to my mad mixing and matching skillz). 🙂 But as much as I still love to be fashionable, I wish I hadn’t bought so many clothes a couple of years ago.

Luckily most of the things I bought are pretty classic so they aren’t out of style, but I still have way too many clothes and I can’t seem to part with them. Sometimes I think about selling or donating them, but the amount of money I’ve spent on clothes really holds me back as I don’t want to get only pennies on the dollar for what I’ve spent when the clothes still fit me just fine and are still acceptably in-style.

I don’t think I’ve ever worn out a piece of clothing, maybe once or twice in my entire life, but that’s my aim for much of what I have now. I don’t plan to spend too much more on clothes this year.

Putting Everything on Credit

When I was at my worst (financially) I was putting every single little purchase on credit. I never knew how much money was in my account, so I would put everything on credit so I didn’t overdraw my checking account. Unfortunately, I was racking up debt quickly as I could never pay off my cards in full at the end of the month, and I still managed to over draw my account at least a couple of times a month. I wasn’t sleeping well at night because all I could think about was if the $5 in my account would last me until my next payday which was still over a week away. I also didn’t want to appear as though I had no money, so I just put more and more purchases on credit.

Finally after a couple of desperate internet searches, I found personal finance blogs and since then I’ve been obsessed with reading them and learning as much about personal finance as possible. I still make mistakes now and then, but overall I’m doing much better about managing my bank accounts, paying off debt, and saving so I have money for emergencies, like when I missed 4 days of work this week and last week due to being sick (and I don’t have enough paid leave to cover all the hours I missed).

I’ve made many more financial mistakes, but these are three of my biggest and most regrettable mistakes so far. Everyone makes mistakes, financial and otherwise, from time to time. The key is not to quit making mistakes, but to learn from them.

What are some of your biggest financial mistakes?

About Kayla

Kayla is a mid-20s single girl living in the Midwest, USA. She is focused on paying off her consumer and student loans, while simplifying her life and closet. You can join her on her journey at ShoeaholicNoMore or follow her on Twitter.


  1. I definitely understand how people can make mistakes. I think right now, would be putting all my money on my credit card when I didn’t have a job. It definitely wracked up the debt and taking out too much student loans. Thankfully I am actively thinking on how to pay them off and did AmeriCorps for two years, so that will help pay off some student debt.

    My boyfriend and I are looking into buying a house, but I have read a lot of other people’s mistakes and saw that you need some type of down payment. Good to know!!!

    In regards to your clothes, have you tried the “If you haven’t worn it in a year, donate it?” Try that if it helps but that’s great that you can mix and match…Good luck!


    • Michelle, I’m glad you have a plan in place to help pay down your student loans and that you have been doing lots of research to avoid house-buying mistakes before you take the plunge. 🙂 I wish I had known more about home ownership before I bought my house, but I can’t change that now.

      As far as clothing, I do wear everything as I make myself cycle through my clothes by putting them at the back after they come out of the laundry and wearing them from the front. So they all get worn, but because I have so many, it takes me quite a while to get through them all.

    • SimlpyFinanciallyFree says


      Remember that not only do you need money for a down payment and closing costs, but you also should make sure that you have a cash buffer left over. Once you are a homeowner you no longer have a landlord to call if something goes wrong so you need to make sure you can cover the costs without having to carry a balance on credit for months. The sink is backed up and you don’t know anything about plumbing, you have to bring in a plumber. The hot water heated expectantly dies, you need to replace it (our died last year despite not being that old). Before jumping into your dream home, just make sure you are prepared as well because you want your homeowner experience to be a good one. Good luck!

  2. When I first got a credit card, I definitely put everything on credit–I was so excited about getting points! But yes, that was a slippery slope. I quit credit cards cold turkey back in August and now I’m working hard at paying them off. Maybe I’ll consider rewards and points again some day in the distant future.

    • I might too, but I don’t think I will actively pursue rewards until I’m debt free (or at least much closer to it). 🙂

  3. I’ve made my share of financial mistakes, though fortunately they are mostly a few years in the past at this point! One of the worst was desperately needing to buy a car, but not having money to put down and still pay for books and other costs for school. So I took out extra student loans for a quarter — and then took on a car loan on top of that. I’ve learned a lot since those days, and now I’m all about paying cash.

    Kayla, given how you’re rocking your side gigs and taking control of your finances, I’m sure you will kick your debts to the curb and be doing amazingly well in no time!

    • Thanks Jennifer! I’m glad you’ve learned from your past mistakes and are doing better now. That’s encouraging to hear. 🙂

  4. I can say this, I have not spend my money on clothes, (much to my DGFs dismay…).

    I can remember the first Amex Gold card I received. I was authorized up to $10K, little did they know that I barely made that in a year. It’s a good thing I didn’t charge that much.

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