Today, April 15, is tax day in the U.S. It’s the day to pay the piper…er…the federal, state and local governments the taxes that are due.
I don’t want to depress you, any further than you already are, by talking about how much money you’ve paid in taxes to the government.
But I do want to talk about a concept that TV and radio personality Dave Ramsey calls “Stupid Tax.”
Stupid Tax is the money we’ve spent (wasted) on decisions that ended up being financial mistakes or errors in judgment that cost us more than we bargained for.
Have you ever made a rush decision to buy something that seemed like a great deal at the time, but later you regretted? Like…
- A timeshare condo that you ended up rarely using and took a big loss on when you finally sold it? Stupid Tax!
- A four-day cruise package that you paid a great price for up-front, but never used? Stupid Tax!
- A “how to use other people’s money to get rich in real estate” program or workshop you attended that cost a bunch of money up-front, but…of course…you’d make back pretty quickly on your first deal…that you never ended up doing? Stupid Tax!
- Equipment for a business you were really excited about starting…but after starting it you got really unexcited about it? And worse yet, you bought it on credit and ended up paying for it long after you stopped using it? Stupid Tax!
Whether we want to admit it or now, all of us have paid Stupid Tax at some point in our lives. Some, sadly, have paid a lot more than others. I’ve known more than a few people who got sucked into buying the timeshare. I’ve never done that (and don’t think I ever will), but I have fallen prey to the other three things I listed.
In many cases, once the deal is made and the money is spent, we can’t go back and undo what was done. So what do we do when the regret sets in, and how can we minimize the damage that was done?
- Admit that you just paid Stupid Tax. I think it is important to admit (at least to ourselves, if no one else) that we’ve made a mistake.
- Determine to learn what you can – about yourself, your decision making process, your true motives, and how you could have handled things differently.
- Look for a way out. Think of all the possible ways you might be able to get out of the deal. Search the Internet and ask your friends if they have any ideas.
- Look for a way through. Think of all the possible ways you can make the most of it. Can you re-sell it? Can you find a way to use it after all? Can you give it to someone who can use it?
- Resolve to do things differently next time you’re tempted to make a quick, or expensive decision. Decide now how you’re going to handle future decisions.
- Check out the links below for other tips.
Despite all the Stupid Tax I’ve paid in my lifetime due to ill-conceived and ill-advised decisions I’ve made, I’m convinced that paying Stupid Tax is not the worst thing that could happen to me. However, paying Stupid Tax more than once for the same type of thing…is!
Please share your comments. What kind of Stupid Tax have you paid in your life? How were you able to overcome it?
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