GOOD Decisions I’ve Made On My Investing Journey

I’ve had 2 posts worth of BAD investing decisions so far (1, 2). I didn’t want people to think I’ve not made any GOOD decisions, because I have, just not as many yet. I’m still young, had no financial education, and had some bad financial advice early in my career. But I’m riding the wave and learning from my mistakes to be able to make good financial decisions as my journey continues…

1. I started a ROTH IRA when I got my first job. Although I went through 9 different reps at Edward Jones, I ultimately didn’t have much to do in the summer of 1998 when I had a job that paid more than I needed so I consulted a rep there that showed me the light. I got started and put in on it until I cashed it out in my “bad decisions” tab #4.

2. Marrying my wife. No, this isn’t just a sentimental number, but you’d be surprised the $ you save on taxes filing jointly as opposed to separate and living together.

3. Having children at the end of the year. No, seriously – I had both of my kids at the end of the year, but am able to claim them for the entire year, Uncle Sam doesn’t care what month, just what year. 🙂

4. Bought my first place at the right time. The market was rising, but topping out yet in 2004 when I signed the papers. A year and some change later I sold it for 60k more than I bought it for. This also falls in my BAD investing choices also because I didn’t wait the 2 years of owing the properly and had to pay capital gains for it of around 11k.

5. I can’t fund any of my retirement or investing positions if I don’t have confidence and ability to do my current day job. I’m always searching for ways to improve processes and making my upper management aware of the projects I am working on, while keeping an eye open for new positions. In 2007 I’ve increased my salary by almost 30% and have a prospective new position on the horizon at the beginning of the year. Invest in yourself and keep the resume up to date; someone may be searching for someone with your EXACT skillset.

6. This blog. No kidding. It has been very good at keeping me on task; and pointing out what I need to get done. People have been very receptive to the blog and I hope I’m providing help to others searching it.

7. Keeping a net worth update monthly. It keeps me on the tails of the folks that are watching my accounts so I’m not missing anything.

I’ll have more in the future; maybe enough to negate all the bad, but for now, I’ve had my stumbles…

Filed Under: adviceCompensationDebtEmergency fundfinancial educationHouseInvestingNet WorthPassive IncomePortfolioReal EstateRetirementROTH IRATaxes

  • I hear you on #3. Try as we may we couldn’t get our little guy to come out a month early (he was born in January)! All kidding aside, #2, my wife, is probably one of my best financial decisions. Not that it was a financial decision. But she is great at budgeting and keeps me honest when I want to buy gadgets.

  • It’s always nice to hear about good decisions once in a while. It feels like most of the personal finance blogs are written from the perspective:

    I screwed up > I recognized I screwed up > I’m going to figure out how to get out of this mess > and then I’m going to work towards retiring early!

    Hank, that tax break is nice (at least until it expires), but having your kids at the tail end of the year makes using your flexible spending account mighty difficult!

  • My 2 kids were born on Jan and Feb, so 🙁 I missed out on tax savings previous years. 🙁 Getting married and having kids have simplified our life so much though, much cheaper, something or high though, like kids health and education related expenses.

  • What a great list! I agree with marriage and keeping track of your finances with this blog. It certainly has kept me honest.

    BTW, is there a marriage tax penalty btw? I did a survey of coworkers, and they have all paid 5-20k more a year in taxes.

  • “Marrying my wife. No, this isn’t just a sentimental number”
    Its about your wife? Love is sentimental.

  • I like to trade actively with a portion of my portfolio. I do well, but always add winnings to my longer term holdings.

    The key to my longer term holdings is to make sure I don’t “hold” during declines. Even the great companies got beat up badly in the 2007-2008 bear.

    One thing most people don’t consider if they have a 401K and other retirement accounts, is managing it. Don’t let the money just ride and hope someone else is really paying attention to your money. The average fund never beats the market, and loses worse in a bear market.

    Something as simple as a 100 day moving average on the broad markets – which most institutional traders use too, would have dictated an exit when markets began to trend downward in late 2007.

    That 100 day average (you can use a 50 day as well but it triggers too many trades) began rising in May of 2009, and signaled a re-entry into growth funds or good stocks.

    It’s not perfect, but that approach doesn’t take a lot of time to monitor, and it would have saved so many investors the pain of serious losses during the great decline.

    Best of all it allowed the investor to buy with A LOT MORE money after the March lows.

    Not being in when a fund is losing big, is just as important as how well a fund performs in a bull trend.

    That’s been a simple way I keep compounding!!

  • Warren

    Glad you made a good one. I have been having some wrong choices and can’t wait for a good one.
    .-= Warren´s last blog ..Home Mortgage Refinancing With A Bad Credit Score =-.