2 Big Investing Mistakes That Actually Made Me Smarter

Back in 2013, I bought 25 shares of Tesla stock. I remember seeing electric cars starting to pop up around my neighborhood at the time and thought they were so cool!

Like most beginning investors, I checked the stock price every 15 minutes after making the trade. (Actually that’s a lie — I probably checked the prices every 5 minutes! 🤣). My $1,350 investment in Tesla started to rise and rise over the following weeks, and I was excited that I had picked a winner!

Just 18 days later, I was so incredibly pleased with an amazing ~70% return that I sold the 25 shares. Making $900 profit in just a few short weeks felt amazing! Woohoo!

Looking back now, however, I realize how much of a fool I was. (Still am in a lot of ways!). Tesla’s stock price has since increased more than 5,000%. If I had just held onto my original 25 shares, my $1,350 investment would now be worth about $106,000.

I bet we all have stories like this. Shoulda woulda coulda.

Advice for My Younger Self About Stocks

I shared this same story with a friend the other day. They laughed and said, “I bet you wish you could go back in time and tell your younger self not to sell those shares!”

While, yes, that’s a fun thought, truthfully if I could go back in time and give my younger self advice, I wouldn’t talk about Tesla at all. I would encourage myself not to buy any individual stocks whatsoever.

A lot has happened since 2013. A lot of changes and growth — and I’m not talking about in the stock market — I’m talking about changes and growth within myself. My personal financial education has grown by leaps and bounds. Over the last 7 years:

  • I’ve read 100+ books on investing.
  • I no longer try to time the market.
  • I don’t pick individual stocks anymore. 
  • I don’t get emotional about investing anymore.
  • I don’t invest in things I don’t understand.
  • I think long term. Quick profits don’t interest me anymore.
  • My mindset is slowly shifting to capital preservation.
  • I no longer want to be a mega bajillionaire. Just making $2-3M is plenty enough for my lifestyle.
  • I’m not in a hurry to make money anymore. Time + compounding is my advantage.
  • I don’t look at stock prices every 15 minutes. I try not to check the markets at all.

Going back in time and telling myself that Tesla will grow 5,000% sounds really cool. But it would be WAY cooler if I could go back and teach myself the 10 things I just outlined above. It would probably result in way more than an extra $106,000.

Here’s another big mistake I made. This time in real estate …

Advice for My Younger Self About Real Estate

In 2008, I bought an apartment in Hawaii. This was at the start of the housing collapse, so I thought it was a killer deal.

It started as a house-hack, but I transitioned it to a full rental property as soon as I moved out. From all the numbers I ran, the property should have broken even on cash flow each month.

But, after 2 years of ownership, I realized I was slowly losing money. Not a huge amount — but enough to get me scratching my head at the end of each year. Although I slowly increased the rent over time, it was not enough to cover the constant increase in expenses. HOA fees, leasehold fees, taxes, vacancies, etc… Death by a thousand papercuts.

I should have sold and cut my losses, but I couldn’t. I became emotionally attached. I fell in love with that apartment. I thought that if I held on longer, it would eventually increase in price and make up for all my losses. Houses always increase in price if you hold them long enough, right? 🙅

5 years later, still losing money, didn’t sell. 7 years later, still losing money, didn’t sell. 9 years later, still losing money, didn’t sell.

I really am a stubborn investor. This was a classic sunk cost fallacy.

Finally, after 10 years, I listed and sold the apartment. My rough estimate is that I lost about $50k over that 10 year period. It averages out to losing about $5k each year. It adds up quickly over time!

What I’ve Learned About Real Estate Investing

Same story with my stock trading mistakes… Changing 1 decision from 10 years ago would be freaking awesome. Oh how I wish I could go back in time and slap myself in the face.

But, the real estate knowledge I’ve accumulated since then (much of it learned from this failing property) is worth way more to me than saving $50k on 1 investment. Given the chance to go back in time, I would mostly preach to myself about basic real estate investing principles. Over the last 10 years…

  • I’ve listened to 100+ episodes of the BiggerPockets real estate podcast, read tons of books/blogs about property investing, how cashflow works and managing properties.
  • I went to real estate meet-ups in multiple cities and made friendships with other investors. I have mentors and investing partners now.
  • I don’t get emotional about real estate anymore.
  • I have very specific deal criteria when evaluating new opportunities.
  • I hire other people for tasks I’m not good at (like property management).
  • I scour my monthly management reports and look for errors and things to improve.
  • I evaluate my Return on Equity constantly.
  • I stay away from leasehold properties, HOAs, any anything that is not income producing from day #1.
  • I learned that leverage only works in your favor if you borrow money at a lower rate than the rate your investment is increasing at!
  • I consider my ongoing TIME investment before buying → passiveness is my priority now.

Going back in time and advising myself to not buy this property (or to sell it sooner!) would be nice. But I think having better principles as a young investor would have been way more valuable to me in the long run.

Should Have, Would Have, Could Have

There is nothing we can do to change the decisions we made in the past. And even if we could reverse a few big investment decisions, it would only change our bank balance — not the *more valuable* knowledge that comes from failing so hard.

OK, your turn… tell me some of the missed opportunities and screw ups you’ve had. Better yet, tell me what you’ve learned since then. Going back, would you give yourself individual stock tips, or broader investment principles?

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  1. The Millennial Money Woman January 15, 2021 at 5:49 AM


    I loved reading this because I could relate 100% to timing the market. That’s something that I used to do in my very early years of investing. I thought I could wait for a market downturn and then invest my money. And you know what? I was so wrong!

    Everytime the market did correct and swing downwards, I never budged because I thought the market would swing downward even further. And before you knew it, prices were rising again and I had missed my chance.

    That’s when I knew if I ever wanted to continue with my money invested in the stock market, I would have to commit to a dollar cost averaging strategy. Something that’s stress free and automatic. And I have not looked back since!

    Keep up the awesome work!



    1. Joel January 15, 2021 at 10:07 AM

      Buffet once said “the stock market is a device for transferring money from the impatient to the patient”. It’s hard to be patient, especially when everyone else *seems* to be making money hand over fist around you. Slow and steady is how most people win the race :)

  2. Josh January 15, 2021 at 7:59 AM

    Love the perspective here! I’ve made many investing mistakes myself and would go back in time and change any of them. The lessons have been worth every penny lost. One particular lesson was investing in a startup business that crashed and burned (Ive written about it on my blog). That was a $25,000 lesson in the importance of investing in what you know, and with people you trust.

    1. Joel January 15, 2021 at 10:00 AM

      Wow! I almost invested in a brew-pub years back. Something in my gut told me it just wasn’t right, so I ended up sitting on the sideline and watching other people invest. The pub had big issues and closed only a few years after it opened. I agree with you – “Invest in what you know, with people that you trust!”

  3. Eric January 15, 2021 at 10:22 AM

    The biggest investing mistake I had was not maxing my Roth IRA sooner, which I’m sure most can relate to.

    I’m an index fund investor mainly for retirement accounts, but hold Tesla in a brokerage account and believe it will surpass Apples market cap within 4 years.

    I’m younger with a relatively high risk tolerance so if Tesla goes to 0 it’s not the end of the world for me.

    Live in the present while learning from the past. Don’t over leverage and only take calculated risks you’re comfortable with.

    1. Joel January 15, 2021 at 11:40 AM

      Great advice, Eric. I hear ya on the Roth front :)

  4. Adam January 15, 2021 at 11:32 AM

    On March 11, 2020 I swapped my entire bond exposure — $50k — from VBTLX into VTSAX, and it happened to be not far from the bottom of the crash. I thought to myself “hooray, I’m a genius, it worked!”

    On June 10: “alright, market’s back up! I’ll swap that back into bonds.” And did it.
    On July 8: “man, there’s got to be a slowdown soon, I should convert another $50k into bonds.”

    July 8 VTSAX: $77.96
    Today VTSAX: $96.71

    So I locked in some small gains early on, but that $100k missed out on almost 20% gains later. Oops. We’re still way ahead of projections I made in 2015 but from here on out I’m sticking to guide rail allocation percentages rather than gut feelings.

    1. Joel January 15, 2021 at 11:45 AM

      Oh, man. Great lesson… Even if you get lucky and time the market once perfectly, it’s very difficult to time it twice, three times, or more… The more in/out transactions, the worse it is in the long run.

      Thanks for sharing! And congrats on being ahead in projections overall!

  5. freddy smidlap January 15, 2021 at 2:34 PM

    i made every investing mistake available when i started. i’ll tell you my plug power story briefly as it was similar to your tesla story. 2013/14 i owned a boatload of shares, 6921 shares as i looked it up this week. i thought there was a bright future in hydrogen fuel cells and i bought those shares for $1.66 a share and had an old chemist friend working for the company. it turns out i sold and made money but earlier this week the shares were above 70 bucks. the calculation was close to $500,000 if i held them. you gotta learn your lessons and break a few eggs to make that investing omelette i guess.

    like you, i learned and did not repeat most mistakes. i stayed in the game and learned the patience of buy and hold stock investing. it’s been great but it sure ain’t for everyone.

    1. Joel January 15, 2021 at 5:47 PM

      Whoa. Thanks for sharing – and that makes me feel a lot better about my measly 100k miss. haha. Glad you’re looking at the positives. I don’t really like telling that Tesla story. Not because of the embarrassment, but more because I don’t want to be one of those old people later in life that say things like “when I was 20, Tesla was worth X and if only I invested and held for 40 years I’d be a mega millionaire.” When old people say that stuff to me, I always think – what is the actual lesson learned?

      Cheers, Freddy. Have a great weekend my friend!

  6. Stephanie Chin January 15, 2021 at 3:48 PM

    We owned Apple shares somewhere between 1993 and 1997. I distinctly remember having a conversation driving down the freeway that we didn’t think the stock was going anywhere so we sold it. ‍♀️

    1. Joel January 15, 2021 at 5:48 PM

      Wow! You live, you learn. :) Thanks for sharing Steph and have a great weekend!

  7. steveark January 15, 2021 at 4:13 PM

    I agree buying Tesla was the only mistake, selling it was a win, so what if you didn’t hit the powerball, $900 is a nice scratch off. Not that I’d ever buy a lottery ticket either. I held onto $60,000 of stock rights for one month to get them in a lower tax bracket year, they fell underwater and expired before I could execute them. It was statistically not a terrible risk to take but I still lost $60,000 trying to save less than $10,000. Now I know, if the money is on the table, take it and run.

    1. Joel January 15, 2021 at 5:50 PM

      Thanks Steve. I agree. Am I gonna sit an complain about the money I’m NOT making, or am I going to focus on the money and things i DO have.? Thinking about the positives is more my style :)

  8. Impersonal Finances January 15, 2021 at 4:51 PM

    Great Tesla story–can’t fault yourself for taking a 70% profit! How were you supposed to know Tesla was going to become a religion!? I think there’s a lot of “being right for the wrong reasons” going on at the moment, and a lot of people who are making a little bit of money now are learning some of the wrong lessons when it comes to making a lot of money later. I, for one, am glad I lost my ass on penny stocks in college haha.

    1. Joel January 15, 2021 at 5:51 PM

      This is such a great point. The worst thing that can happen to a gambler, is winning. Winning teaches them that gambling is good, and they believe they must keep doing it to keep winning. “right for the wrong reasons” i love that phrase.

      Cheers IF, hope all is well my friend!

  9. Liz January 15, 2021 at 7:56 PM

    I have made MANY money mistakes. A “short” list: two multi-level marketing schemes, leased 3 cars, whole life insurance, jewelry, trading cars too often, furniture loans on expensive furniture I didn’t really need, unnecessary closing costs on properties, and I messed around with single stocks for 9 years and lost $50K!!! Finally at the age of 42 or so I came to my senses and implemented the Dave Ramsey program, total game changer:)

    1. Joel January 15, 2021 at 9:02 PM

      Haha I love it! Yeah if I think about it there are a bunch of messed up things I’ve done in other areas (big and small) throughout life. Just gotta keep trying, learning, trying more, learning more, and not repeat the same mistakes.
      Thanks for sharing Liz, have a great weekend!

  10. Alissa Henry January 16, 2021 at 7:15 AM

    I have made so many money mistakes over the years. Loaning money to a start-up that had no real plan to pay me back was a very costly lesson.

    But the biggest money mistake was when my dad passed away in 2009 during the Great Recession. The stock market was down so I freaked out and rolled over his 401K at the bottom instead of just leaving it where it was. I don’t know what I could have eventually made, but I learned that you never make rash money decisions when you’re in an emotional state. But, like you, I’ve learned a ton since then so I try and focus on the money mistakes I have NOT made :)

    1. Joel January 16, 2021 at 10:10 AM

      Emotions get the best of everyone. And your situation is completely understandable, making big money decisions when your life gets majorly disrupted. I’m so sorry for your loss.

      Great to hear you’re looking on the bright side, and more equipped for future decisions! Thanks for sharing Alissa!

  11. Scott W January 16, 2021 at 5:44 PM

    Thank you for sharing. I also made several money mistakes early that I actually believe were blessings because I didn’t have much money at the time so the lessons were worth the cost.

    I bought a 100 shares of telecom stock on my brokers recommendation around 1995 at $36.00 when my net worth was only about $20,000. When the stock dropped to $24.. he convinced me it was an even better buy so I bought another 100 shares:-/

    A year later I sold the 200 shares for about $15.00 a share. Within a couple years I had researched and educated myself to the point that I got rid of the broker and started putting all my money in index funds at Vanguard. Never been tempted to buy individual stocks again and I’m convinced that has served me well. I just reached a net worth north of 1 million at 52. I don’t regret that experience because if I had some success early I would have falsely thought I knew what I was doing and could have lost a lot more a few years later when it would have cost me much more.

    1. Joel January 17, 2021 at 9:09 AM

      That’s exactly right. If you don’t learn the underlying lessons to build wealth, getting lucky early on can hurt you in the long run.

  12. David @ Filled With Money January 16, 2021 at 7:38 PM

    Avoiding non cash flowing properties is definitely the way to go in real estate investing. I’ve been wanting to get into the real estate game for so long now but I’m having so much fun just buying and holding broad index funds that requires no extra work, I’ve been refraining from doing so. I do hope I get into it soon.

    1. Joel January 17, 2021 at 9:12 AM

      There’s no rush – real estate will always be there. :)

  13. J January 21, 2021 at 3:57 PM

    Congratulations on reading 100 books in7yrs! That’s not even to mention all the podcasts lectures, presentations, etc that you put time and effort into in order to grow your knowledge base. I wish we could show that list to current high schoolers to illustrate that continued learning after formal schooling is being done by adults, and it really plays a role in that person’s success. It would be nice to normalize continued education in our culture. My biggest investing mistake is not starting to invest in my 401k as soon as I started working full time. I did eventually start investing 2% after a few years working, since that was what it took to get the company match. Fortunately, the company had a really good match rate at that time, but I still wish that I had put in more than 2% and started as soon as I became full time.

    1. Joel January 21, 2021 at 7:26 PM

      I hear ya’ on the 401k thing. Well, at least you eventually did get started! :) My book reading pace increased majorly when I started getting up at 5am every day. 100 is prolly a bit of a stretch for finance specific books, but almost everything I read is personal development and non-fiction (sad, i know). I agree that continued self education is important after school! Very important. The learning never stops!

  14. HM January 28, 2021 at 3:29 PM

    Hi Joel,

    I have been a follower of budgetsaresexy.com for about 4 years now. Budgetsaresexy blog has inspired me to start a budget and track my net worth. I have very much enjoyed your blogs following J Money.

    I have a question. It is the popular question and for the life of me, i can’t figure the logistic of the answer. The question is: Should I pay off my mortgage early or should i invest?

    Here is my math, and I will be completely honest:

    1. We are currently owning a home with a mortgage of $365,969 with 2.5% interest rate. Our principal + interest = 1454.9. We don’t have a PMI. We just bought this home on October 2020.
    2. If I use Dave Ramsey calculators:
    – Paying off mortgage early: https://www.daveramsey.com/mortgage-payoff-calculator
    – Investment calculating: https://www.daveramsey.com/smartvestor/investment-calculator
    *If I pay an additional $268 (to round up our monthly payment to $2000), we will finish paying the house in May 2044 (6 years early). If we then put all of the house payment ($2000) into stocks for the next 6 years, we will earn about $178,321 in stocks, assuming 7% interest rate.
    * If I put the $268 in stocks for 29 years instead and don’t pay off the house early, we will earn about $301,812 in stocks, also assuming 7% interest rate.

    The difference is significant. Then why should there be an argument of paying off the home early? Would peace of mind worth ~$123,000? Did i do the math wrong or is there any mistake in my logic?

    Thank you so much for your time and your help.

    1. Joel January 28, 2021 at 4:24 PM


      Thanks for being a long time reader! And I’m glad you’re liking our stuff still even though the legend J$ is gone.

      Your math looks correct! It (almost always) works out better to invest extra money vs. pay off your mortgage early. But, for some people, they would prefer to have less risk, and are happy to give up the higher return. One example would be people that are trying to retire in the next few years. They may not want to go into retirement with a mortgage, so they feel paying off their mortgage is a better option. Others can’t sleep at night with large amounts of debt. Others have PMI and really should pay down the mortgage.

      It sounds like you are in none of those scenarios, so investing is a better option (mathematically).

      Couple other things to consider…
      – You’re comparing a mortgage interest rate of 2.5% which FREAKING AMAZING and probably the lowest people have ever seen in their lives. The reason there’s a big difference between your two outcomes is because the mortgage rate is so low! Your mortgage is a great advantage. Keep it! Traditionally, if someone had a mortgage at say 6%, the math outcome would be much more close. That’s why this is always an ongoing debate. Make sense?
      – A mortgage also gives you tax deductions and advantages (depending on how you file – you can claim mortgage interest). So in some ways, it’s even better to invest elsewhere vs. pay off your mortgage.
      – Some people are not as disciplined as you and I, and if they don’t pay off their mortgage, they would blow the extra money on “crap”. So paying down a mortgage is sometimes a forced savings plan for people. (Your math is only good if you stick to the investing plan :)
      – Lastly, this is why people disagree with Dave Ramsay a lot. Debt is not always bad – it can be used as a tool if you handle it correctly. They call it “good debt”. Your mortgage (and specifically the rate you locked in at) is GOOD debt.

      Hope this helps! Congrats on doing the math to confirm. You can rest at night knowing you’re making an extra $150k keeping your mortgage and only making minimum payments. Math doesn’t lie. :)


      1. HM January 28, 2021 at 6:54 PM

        Thanks Joel!

        Our initial thought is to just round up our monthly payment to $2000, but I think we will just put the money straight to $401k instead and try to max that out. If we have any other money left over, then we will put it into mortgage.

        Thank you for the confirmation, and the extra information. I really appreciate your help and your awesome blog.

        1. Slimremy January 30, 2021 at 11:37 PM

          Don’t you have to include the interest saved from paying the mortgage off early (6 years) with the invested amount of $178,321 to get a more accurate amount.

          Also does the $2,000 mortgage payment include taxes and insurance? If so then you would have to subtract those amounts from the $2,000 payments as you still would pay them after the mortgage is paid off.

          1. Joel January 31, 2021 at 5:41 PM

            No for the interest thing, because paying off the mortgage 6 years early IS the interest saved. So no need to add anything else.

            But I see the mistake you found in the first calculations… From the original note it looks like the principal and interest portion of the payment is $1,455 and then they want to add $268 to make $2000 total. But $268 + $1455 doesn’t = $2000. So maybe taxes and Ins are included?

            HM – you gotta run your numbers again! (but I highly suspect you’ll come to the same conclusion – invest the excess, don’t pay down your 2.5% loan because you can make a better return elsewhere typically)

            1. Huong February 2, 2021 at 12:26 PM

              Thanks guys for replying to my comments! Yes, we have to pay $277 each month into escrow. In that case, we would only earn $144,732, which is even less than before.

              Paying off the house is definitely reduces the money we earn later on. I think the only caveat is that it will make us feel better if the market happens to crash. In that case, then we need the extra money that we used for mortgage to buy stocks for cheap :) My husband thinks that we are close to a huge recession due to the US government being so much in debt and still spending money like no tomorrow. So he is leaning toward paying off the mortgage for ease of mind.

  15. Arvind Datta February 12, 2021 at 8:22 AM

    I missed an opportunity of boosting my profits by not investing in shares at the right time. The market was just reviving from COVID effect and my mom suggested me to invest. However, I felt its just a temporary wave and the market would fall eventually. My prediction went wrong and I ended up buying stocks at a bit higher price. This reduced my profit margin.

    1. Joel February 12, 2021 at 12:14 PM

      I think a lot of people had this same experience last year. You are not alone!

  16. Kunal Shinde May 20, 2021 at 7:32 AM

    Well said, Without mistakes you cant learn. Mistakes are the proof that you are trying and want to learn even if they are related to the stock market. Thank you for sharing your experience. from this many people will aware. Even I made mistakes but also learned.

  17. sdarshana August 2, 2021 at 12:42 AM

    Mistakes are essential for the contributing cycle. Knowing what they are, the point at which you’re submitting them, and how to keep away from them will assist you with succeeding as an investor. To try not to commit the investment mistakes, foster a smart, orderly arrangement, and stick with it.