Yahoo Finance 5 Purchases Self-Made Millionaires Almost Always Regret
Being a self-made millionaire often requires patience, great business ideas or methodical, hard work. While many can achieve this status, maintaining wealth is a whole other story. Indeed, being wealthy doesn’t always equate with being financially cautious, and even self-made millionaires make money mistakes.
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Brenda Christensen, CEO at Stellar Public Relations, Inc., is one of these self-made millionaires who said these experiences shaped her perspective on financial decision-making, emphasizing the importance of thoughtful consideration and long-term planning.
“By avoiding impulse purchases and prioritizing investments aligned with my values and goals, I’ve been able to achieve greater financial stability and peace of mind,” added Christensen.
Here are some purchases self-made millionaires almost always regret.
Waterfront Properties
Christensen said that she has learned valuable lessons throughout her journey as a tech entrepreneur and self-made millionaire. One of her regrets, she said, is owning properties near the water — even though the tranquility and natural beauty initially seemed like a dream come true.
“The reality proved to be far from idyllic. My experiences with beachfront and waterfront homes taught me valuable lessons about the hidden costs and challenges associated with coastal living,” she said.
From dealing with the aftermath of hurricanes to unforeseen maintenance expenses and the constant influx of tourists, the allure of waterfront properties quickly faded, she added.
“The worst purchase I ever made was a boat that ended up sinking during a hurricane, leading to substantial financial losses and logistical challenges,” she said.
This ended up costing her around $250,000, with $250,000 for the dock alone and $60,000 for the boat, she said.
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Trendy, High-Risk Investments
According to Jeff Rose, CFP, CEO and founder of Good Financial Cents, many self-made millionaires have learned the hard way that jumping into high-risk investments without proper research can lead to significant losses.
“This includes things like cryptocurrencies or hot stocks that are often hyped but can lead to high volatility,” he said. Rose added that many have discovered that without a solid strategy or deep research, these investments can turn south quickly, leading to big losses.
Rose shared that he personally succumbed to this by investing in private real estate deals and startup businesses through angel investing.
“The allure was the chance to access exclusive opportunities usually only available to high-net-worth individuals, but both investments have ultimately paled in comparison to traditional investing,” he added.
Levi Newman, who achieved self-made millionaire status as a brand marketing writer via Fiverr, echoed the sentiment, saying that before making significant, life-changing investments, you should set aside extra capital to protect yourself when opportunities are limited.
“As a freelancer, the tides of change within the business world often impact our financial stability,” he said. “Making purchases with cash in hand or avoiding long-term payment plans can help you save money — and stress — in the long term.”
First-Class Tickets
One purchase he often finds unnecessary and always ends up regretting is upgrading to first class on flights, said Gene Caballero, co-founder, GreenPal.
Instead, he added, opting for an aisle seat in economy can offer sufficient comfort without the hefty price tag. This approach not only saves money but also leaves funds available for future trips.
Typically, a first-class upgrade costs three times the price of an economy seat. According to Caballero, he’s likely saved $5,000 to $10,000 this year alone — just by choosing economy tickets.
“The food is typically a little better in first class, and there is a little more room, but if you are like me and can’t sleep on a plane anyway, it’s a total waste of money,” he said. “I have always immediately regretted it and won’t purchase first-class tickets anymore,” added Caballero.
High-End Cars
Karla Dennis, CEO and founder of Karla Dennis and Associates, Inc., said the purchase she regrets the most as a self-made millionaire is the purchase of a high-end car.
“Early on when I first came into money, I wanted the high-end $100,000 vehicle as I thought it was a symbol of wealth,” she said. “In reality, it was a dumb purchase and I regretted it the second month I had to make the car payment. You realize having money requires a higher level of financial responsibility. Now I drive a Toyota Camry and I love it.”
Extravagant Luxury Items
Katie Charleston, attorney and counselor at law at Katie Charleston Law, PC, works with self-made millionaire clients. According to Charleston, self-made millionaires typically regret extravagant luxury purchases like high-end fashion and accessories, yachts and jets, unique real estate and high-end gadgets and technologies.
“Extravagant luxury items depreciate rapidly and don’t usually bring long-term satisfaction as styles change,” she said.
And with technology rapidly changing and advancing, today’s purchases — such as the latest smartphones, drones, gaming consoles and high-end cameras — could be outdated tomorrow, she added.
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