My biggest financial mistakes were made in college when I was 20 years old and regional governor of my sorority. Being regional governor meant I was responsible for planning this huge banquet for 200+ guests.
The first mistake I made was I fronted the money to reserve the venue. I had my heart set on a specific banquet room that I thought the girls would love but I was afraid it was too early to ask everyone to pay for their portion of the deposit. Since I didn’t want to run the risk of losing the room, I used my own money to secure it, which cost me a couple thousand dollars.
Looking back and after talking to one of the former governors, I realized I should have never fronted the money and either paid the deposit after getting it from the girls or if I lost the room, to just find another one at a different hotel if necessary. I’ll never forget the way she worded it, “I would’ve said ‘hey girls, we’re going to be having pretzels for dinner if you don’t give me that deposit.'” Point being that having our event at a cheap venue would’ve still been a wiser decision than dipping into my own pocket.
The next mistake I made was selecting expensive party favors and again, fronting the money for it. Every year the girls complain about how “lame” the party favors are at this event. Since I was in charge that year, I wanted things to be different. Better. So my friend helped me find the perfect party favors. The party favors we wanted were a little over budget and we had to buy way more than what we needed to keep the cost down. I figured we could buy the bulk and use most of it for the event and then sell the rest to cover the price difference. The girls ended up loving the party favors. But when the party was over (literally), the girls were reluctant to sell the leftovers and they were unhappy about having to pay me back for them. I was never able to get all of the money I fronted returned.
If I could do it all over again, I would’ve just gone with cheap party favors that were within our budget. If people found them lame, oh well. After a few days, no one really thinks about the party favors anymore. But the issue of selling the remainders and trying to get my money back from the girls haunted me for the rest of my term as governor.
Last mistake I made was not getting the final negotiations with the hotel down in writing. The hotel verbally agreed to give us the money made from the cash bar that night. So after the event, I asked when we were going to get it and the event coordinator said, “I never agreed to that.” When I pushed a little harder she said, “You know, we also never signed a new agreement for the discounted rate I gave you for the food. So I can make this really ugly for you if you’d like.” She was right, the final price per plate we agreed on was never put it writing. So she could’ve easily said I owed her the original price we signed for, which would’ve cost us hundreds more. Thankfully, she didn’t go that far but I still lost the hundreds we would’ve made from the cash bar.
The lesson I learned here was to have everything in writing, especially when it comes to dealing with money!
What about you? What financial mistakes have you made?