Why It’s Important to Make Your Own Financial Mistakes
Disclosure: This article contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. For a full explanation of our Advertising Policy, visit this page for more information.
Last week, I wrote about how lucky I was to have parents who weren’t afraid to talk about money in front of me. From the time I was a child, I knew that debt was bad, saving was good and budgeting was important. My parents taught me so much about money by being open with me about our financial decisions and our family’s finances, but once I became an adult, I still had to make some (really dumb) financial mistakes on my own, even though I knew better.
Like most kids forging their way through life, it didn’t matter how many times my parents told me not to do something (don’t go into debt for a car!), I was probably going to do it anyway. I had to figure things out for myself, even though most of my experiments ended in financial suffering, but that learning process was very important for me. Here’s why I believe it’s important to make your own financial mistakes.
To Realize That Money Can’t Buy Happiness
A big life lesson for me was learning that no matter how hard I try, money can never buy me happiness. Buying shiny new things will give me a temporary shopping high, but it will not make me happy in the long run. In fact, the more stuff I buy, the less happy I’ll become because I’ll have lost some of the security I feel by having extra money in the bank.
Living paycheck-to-paycheck for a while is something many people go through to try to finance the life they think they should have, but a life spent trying to keep up with the Joneses is exhausting and leaves you with nothing but debt and regret, and that’s a valuable lesson to learn.
Because Frugality Is Not a Destination, It’s a Journey
Like all good things in life, living a frugal life is always a work in progress. Hardly anyone is frugal all of the time. We can’t all be Mr. Money Mustache right out the door (and he wasn’t always frugal either.)
We all have wins and setbacks, and you can always learn new ways to be frugal, no matter how frugal you think you already are. Frugality is a work in progress, something that takes continual effort, but the end result is always worth it.
To Realize That Little Victories Become Big Victories
I sometimes have days when I want to forget about saving money and go somewhere (preferably Target) to blow a ton of money, but then I have to reel myself in and remind myself that frugality is a daily process. Saving money through small acts of frugality is what helped me secure big victories like quitting my job to start freelancing and paying off my mortgage early. It’s also what lead me to my pursuit of minimalism and this amazingly simple life I’ve created for myself.
I realized that eventually all of those little frugal victories add up to become one big financial victory, whether it’s in the form of massive debt payoff or early retirement, and that is absolutely worth living a frugal life. I’ve gotten some really great opportunities in my life since I’ve started living frugally, and I never want to go back to the way I was living before.
Making Financial Mistakes Is Okay
Gaining financial knowledge through trial and error is okay as long as you’re actually learning something from it. When I got my first car loan, I was disappointed in myself afterwards for getting rid of a perfectly reliable car for something prettier.
I felt silly for that decision, so I buckled down to pay off that car as fast as I could and vowed to never have another car loan again. From that experience, I learned that I hate being in debt for anything and that nothing, no matter how shiny it is, is worth that crummy feeling. I’m a smarter person because of my past financial mistakes, and that’s why I’m okay learning some things the hard way.
Have you made many financial mistakes in the past? What do you wish you could go back and fix? What did you learn from it?