Melissa Read Scholarship Essay #1

[Tom: This applicant did a great job of illustrating the financial troubles a car can cause. Even when we are young and have relatively little money, buying the wrong car repeatedly can reduce your ability to save and invest for retirement. Let’s see what Bader learned from his mistake.]

Remember that the theme for this year’s scholarship was:

What is the worst financial decision you have made and what did you learn from it?

Applicant: Bader Al-Ahmad

The worst financial decision I have ever made was when I purchased my first car. As I was about to become a senior in high school, I worked full-time during the Summer and part-time 2 years before and accumulated $7000. It was time for my hard work to finally pay off and drive up to school in a car that would turn heads. I went around shopping and stumbled upon my calling…the Ultimate Driving Machine. My impulses kicked and I called my Dad about the 2008 BMW 328i. I just couldn’t resist, the glossy, shiny, black finish and leather interior

My impulses kicked in and I called my Dad about the 2008 BMW 328i. I just couldn’t resist, the glossy, shiny, black finish and leather interior. My Dad gave the bad news, “Bader, these are luxury cars and very expensive to maintain. You know oil changes are charged at a rate premium as well as gas, brakes and regular servicing? But, your money, your choice.” All I needed to hear was “your choice.”

My Dad came over and signed the sheets, it was the best drive home. I was so happy until I realized I just bought a used car and knew nothing about the service history, so I took it to a European Servicing shop and got it checked out, bumper to bumper. The mechanic called me up… I was devastated afterward. “This car wasn’t a bad buy but it needs some typical used car work. You’ll need new brake rotors, brakes pads, an oil change with a filter and a differential fluid change.”

 

I went home, did some research on all the parts and fluids, a grand total of…. $1000, not even including service hours which would’ve amount to a total of $2000. Looks like I needed a small loan of $2000 but then again I’m 17 so that’s out of the question. I realized what an idiot I was and told my Dad I was sorry and that I’m prepared to sell it.

“Son, I warned you. It was your decision so it’s your mess to get out of.”

I was devastated, it was the first day of school, so I just decided to enjoy it for a week or two then just sell it. On my way to school, this happens:

 

Great, the other driver (100% @ fault) was texting and driving and turned into my lane not yielding. My dream car was gone for good but I’m still here, that matters above all and should never be taken for granted since I lost an uncle in a terrible car accident 6 years ago.

I took a lesson out of this. Just as Dave Ramsey says, live below your means! Even though I was able to technically afford a luxury car, I should’ve taken into account other factors such as the fact I’m going to college next year and need every dollar I can get; the cost of maintenance is also a big part, no car is perfect. It was very stupid of me to buy a luxury car, especially a used one where repairs cost 2/7ths what I purchased it for. Finally learning my lesson, I decided to purchase my next car with the check that Travelers Insurance sent me 3 weeks after my collision.

Receiving a very generous check of $8000, I bought a Toyota Corolla for $6000 and haven’t run into any major maintenance issues. Not spending the whole check made me very proud, my brain and not my gut did the decision making. That extra $2000 is now sitting in my college fund and I have only been adding to it from working. This accident taught me a very valuable lesson and was thankful to have learned from it. There is nothing more valuable than preparing for the future and expecting the unexpected.

 

 

                                                                                 

Tom
Tom is a doctor, husband and father of five with a passion for parenting and finance. When he isn't skateboarding, riding BMX, or jumping on the trampoline with his kids, he is reading and writing about personal finance. He helps high income parents educate and mentor their kids to become financially, emotionally, and intellectually self sufficient.

One Response to “Melissa Read Scholarship Essay #1

  • Great lesson learned!

    I like how Bader recognizes the following:
    a) He is fortunate to be alive after a car accident and does not take that for granted
    b) He received good advice but chose to ignore it at the time. Hindsight is 20/20 and learning from a mistake like this will likely help him take good advice in the future.
    c) He is already learning solid financial stepping stones (he mentioned Dave Ramsey) at a young age.
    d) He chose to learn from this experience, making a wiser purchase with the insurance money. It could be easy to just repeat the mistake but he didn’t!

    Looking forward to more essays to come!!!

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