Money Talks, So Should You

50-Plus Finance: Make your mistakes early so you can be embarrassed by them longer

David Leto
by David Leto , Dimespring 30 (@50PlusFinance)

When you first start out in your work life you think you’re going to turn the world upside down with all your great ideas and knowledge. But eventually you find out how much you need to learn. I learned a lesson in my first big job when I was in my 20s. You never forget the really big mistakes in your life.

My first job was with a construction company. Even though they assigned me an office, most of my time was spent in the field. There were several job sites I needed to visit every day for inspections and supervision, so I had the bright idea that I needed a cell phone to conduct business.

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These were the days when the cell phone was just coming into broad use, and the average cell phone cost about $5,000. Many people remember seeing the phone used by Michael Douglas in the movie "Wall Street" — the one that looked like a brick with an antenna. Where I worked the only person to have one was the boss, the owner of the company, and his phone was so big it needed to be in a briefcase. Half of the case was the battery and the other half was the handset and the electronics.

The $5,000 price tag was a little too high for my pocketbook, so I decided to wait a while until the prices came down. About a year later, a newer model phone came out for the low price of $2,000. I approached the company and they said if I buy the phone they would cover the bill. What a deal!

I purchased the phone on credit because I didn't have the $,2000. Of course, my salary was only $400 a week and I was buying a phone that cost more than a month’s pay. This made perfect sense to me because I thought it would help me and the company save a lot of time and money. But I was so wrong.

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After using the phone for just a few months the company decided the monthly bill was too high and the benefit was too little. They stopped paying the bill and I was stuck with a useless phone. I couldn't cover the bill on my salary. At that time you were charged 40 cents a minute, meaning if you talked 90 minutes a day your bill would be more than $1,000 a month.

I couldn't return or sell the phone because a newer, smaller and cheaper phone came out. I spent the next several years making payments to my credit card for this boat anchor. I made the mistake and I paid for it. Lesson learned.

David Leto writes about family, finances, and retirement planning for the 50-plus person. David is a member of the Dimespring 30, a community of bloggers sharing their thoughts, experiences and attitudes on personal finance.