I’m a Self-Made Millionaire: Here Are the Splurges I Regret

When you’re a newly minted millionaire — you’re bound to make a few money mistakes. No matter how savvy you might be when building wealth , the temptation to splurge is great.

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GOBankingRates spoke with two self-made millionaires: Tommy Mello, CEO and founder of A1 Garage Door Service , and Harrison Tang, co-founder of Spokeo , to talk about some of the splurges they regret having made.

Read on for some of our insights into some regrettable — and avoidable — splurges :

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Poorly Researched Investments

“One of the expenditures that I regret making immediately after becoming rich is purchasing a property as a means of investment,” Tang said. “Elderly and experienced individuals advised me to explore investment opportunities to increase my income. I thereby considered real estate investment as suggested by someone I knew.”

“I wasn’t familiar with the market and bought a property,” he noted. “I continued to pour money into the property, trying to fix various issues, hoping it would turn into something profitable. The breaking point came via a major repair cost I couldn’t afford, draining my business’s finances.”

“Therefore, I decided to turn to certified financial professionals for help,” Tang said. “I wish I had considered consulting a financial professional before making any investment decision. As a newly established entrepreneur, the money I lost in real estate could have been invested back into my business.”

Luxury Cars

“As an entrepreneur who has built a business from the ground up, I’ve experienced both the highs and lows of financial success,” Mello said. “After achieving significant financial milestones, it’s easy to make expenditures that, in hindsight, might not have been the best decisions. One of my first splurges after [my company] started seeing major success was purchasing a couple of luxury cars.”

“I believed they were symbolic of my hard work and success,” Mello explained. “I bought a high-end sports car and a luxury SUV, thinking they were not only rewards for myself but also a way to make a statement.”

He noted, however, that these vehicles quickly depreciated, and the novelty wore off faster than he expected.

“The maintenance costs were exorbitant and didn’t provide the long-term satisfaction I thought they would. The money tied up in these depreciating assets could have been better invested in growing my business or other appreciating assets,” Mello said.

Instead of splurging on luxury vehicles, Mello said he should have invested that money back into his business or diversified into other investments like real estate or stocks.

“These investments would have appreciated over time, adding to my wealth rather than draining it.”

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Expensive Real Estate

“Another significant expenditure was buying an overly extravagant home,” said Mello. “At the time, it seemed like a dream come true to own a massive property with all the bells and whistles. I wanted a home that showcased my success and provided every luxury imaginable.”

However, he said upkeep and maintenance costs for large properties were enormous. Additionally, the time and effort required to manage the property took his focus away from business.

“Real estate markets can also be unpredictable, and the property didn’t appreciate as much as I had anticipated. It became a financial burden rather than a smart investment,” Mello added. “A more modest home would have sufficed and freed up capital to reinvest in [my company] or other ventures. Investing in income-generating real estate properties would have been a smarter choice, providing a steady revenue stream and potential for appreciation.”

Lavish Lifestyle Choices

“In the initial flush of success, I also indulged in a lavish lifestyle–expensive vacations, high-end dining, and luxury goods,” Mello continued.

While these experiences were enjoyable, he said they were fleeting and didn’t contribute to long-term financial stability.

“These expenses quickly added up, and the temporary joy they brought didn’t justify the high cost,” Mello said.

He said it also set a precedent for unsustainable spending habits that were hard to break.

“I should have practiced more restraint and focused on experiences that provided long-term value,” Mello said. “Traveling for business development or investing in personal growth and learning would have been more beneficial.”

Lessons Learned

“These experiences taught me several valuable lessons about financial management and prioritizing long-term gains over short-term pleasures,” Mello highlighted. “Always consider the long-term value of big expenditures and focus on investments that will appreciate over time or contribute to the growth of your business.”

“Maintain a lifestyle that aligns with your long-term financial goals. Enjoy your success, but don’t let it lead to unsustainable spending habits.” Mello said. “Reinvesting profits into your business or other ventures can yield higher returns than spending on luxury items that depreciate.”

“Continuously educate yourself about financial management and investment strategies to make informed decisions and avoid costly mistakes.” Mello continued. “Today, I approach spending with a more strategic mindset, ensuring that every dollar spent aligns with my broader financial goals and contributes to long-term wealth and stability.”

“Reflecting on these past expenditures, I’ve become a more disciplined and thoughtful entrepreneur, always seeking to balance enjoying the fruits of my labor with ensuring sustained growth and prosperity.”

This article originally appeared on GOBankingRates.com : I’m a Self-Made Millionaire: Here Are the Splurges I Regret