Ask the Readers: What was the BEST Investment Decision You Ever Made?

by FI Fighter on February 13, 2015

in Ask the Readers

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The path to financial freedom is not an easy one. It takes a lot of effort to get there, and many will fight their entire lives and still not get to the point where their passive income exceeds their expenses each and every month.

We all take our bumps and bruises along the way, and if you’ve invested in the markets for awhile, I’m sure you’ll agree that the journey can feel a lot like riding a rollercoaster on many occasions. Still, rain or shine, highs or lows, regardless, we keep on investing because we have full conviction that we are doing the right thing to better our futures.

Good earnings and an even higher savings rate are just some examples on how to shortcut the time it takes to get to financial nirvana. Also, depending on the investment decisions you make along the way, this can help greatly expedite your progress, or set you back a few years. Whether it be luck or skill, the right moves do make a huge difference in the grand scheme of things.

At this point, I would like to ask everyone, “What was the BEST investment decision you ever made?”

  • Best stock decision.
  • Best real estate decision.
  • Best lending decision.
  • Best business decision.
  • Best knowledge (growth) decision.
  • Etc.

This is a very open-ended question, and can mean more than just a simple transaction event (e.g. buying or selling). For myself, and many other freedom fighters, I’m guessing the decision to actually get started with investing was one of the best investment decisions ever made…

And getting started is tougher than it might sound. When you are new and green, everything seems overwhelming and excessive. I remember when I first decided to start investing in stocks in late 2011 and began researching individual companies… Not only were there a million terms to learn, but just the sheer number of publicly traded companies that are out there is mind-boggling… “Oh boy, this stuff is going to take a lot more time to sink in and marinade than I thought!”

Anyway, if I was going to answer with the best investment transaction decision I’ve made over the last 4 years on the journey to early FI, I’m going to go with the following:

  • Purchasing Rental Property #1
  • Purchasing Rental Property #2

I know that ‘decision’ should be singular and not plural, but I’m electing to go with those two transactions because they were nearly identical, and really just the same move duplicated twice.

  • I purchased Rental Property #1 in August 2012 for $315,000. I put in 25%, or $78,750 to close escrow. It most recently appraised at $435,000.
  • I purchased Rental Property #2 in February 2013 for $290,000. I put in 20%, or $58,000 to close escrow. It most recently appraised at $440,000.

The reason those transactions rank at the top of my list is because they presented a very unique opportunity that rarely occurs in my local real estate market:

  • The ability to generate strong cash flow on Day 1 with typical 20% downpayment.
  • Opportunity to buy at a significant discount relative to previously set all-time highs.

I wasn’t a real estate investor prior to 2012, but from talking to other local investors, I’ve learned that investing for cash flow prior to the subprime market crash of 2008 was a foreign concept. Back then, the only reason to acquire rental properties in the Bay Area was to speculate on future price appreciation… Yes, that’s a risky proposition, and a lot of investors paid the price (literally) when the housing market collapsed and they were unable to support the negative cash flow each month.

Crazy or not, it was the norm back then… and it’s starting to become the norm again today (scary thought). Right now, it’s extremely difficult to find a cash flow positive property in the Bay Area… unless you are willing to force cash flow by putting in a very large downpayment (30%+)… Or, unless you can get lucky enough and lease out to a corporate tenant who is willing to pay a premium for rent + ammenties. In general, when you have single family homes pushing north of $650,000 (even in mediocre locations), and renting for only $2,800/month, the numbers simply don’t work. Townhouses and condos can offer better cash flow potential… but even most of those options will still be cash flow negative on Day 1.

Today, with the benefit of hindsight, I really believe that these two moves were the best financial decisions I’ve made in my life (so far). With two cash out refis completed recently, I’ve now pulled back out all my investment capital (and then some) on each property.

Looking back, I can’t say that I had enough experience back then to know what I was doing; I simply got lucky and found myself caught up in the right place at the right time. In the future, if such a wonderful investing environment presents itself again, I will have the knowledge and experience to know that opportunity is indeed knocking… and pounding loudly on the door! It will be time to capitalize, once again.

Sometimes, it’s better to be lucky than good… Or, as they say, “luck is when opportunity meets preparation”. But you have to play the game to have a shot.


What was the BEST investment decision you ever made?

{ 25 comments… read them below or add one }

1 Gen Y Finance GuyNo Gravatar February 13, 2015 at 9:46 am

I don’t know if I have the best investment decision I ever made, but as you pointed out, it would have to be that I started….

But the best decision I have ever made that will effect my path to financial freedom and expedite that path would be moving our of Orange County about an hour where the cost of living was much cheaper.

The move alone allowed me to buy a house for half the money that was 4X’s the size of anything I could buy in the OC. This allowed me to reduce my expenses by $1,500/month…which goes right back into investments. Now I am looking at where I might have more fat to trim without lowing my standard of living.



2 FI FighterNo Gravatar February 15, 2015 at 8:48 am

Gen Y,

COL has a huge bearing on when one can reach financial freedom, I agree. I lived in OC briefly and it’s almost just as pricey as it is in the Bay Area… but the wages aren’t as high which doesn’t make things any easier.

$1,500/month extra for investments is nothing to sneeze at and those returns will make a noticeable difference in the near future, if not already.

For my plan to work, it will either require me to relocate to a cheaper area, or to stay employed for several more years to make it work in the bay Area… Right now, I’m much more focused on the former.

All the best!


3 MaryNo Gravatar February 13, 2015 at 9:59 am

Best real estate investment – Rental property #2 in summer 2011 for $115K with 20% down. Worth approximately $200K. Monthly mortgage (including taxes and insurance) is $700. Renting for $1500.

Best stock investment – BAC at $6.55/share. I wish I bought double the quantity.

Best business decision – Marrying my husband! LOL Always good to find someone with the same financial ideals.


4 FI FighterNo Gravatar February 15, 2015 at 8:50 am


All 3 were wonderful decisions and I am happy for your success!

I do wish I got started with REI slightly sooner, and 2011 was prime time for good deals without all the bidding wars that ensued in 2012.

BAC was a steal at that price and I missed out on that one…

Finding the right partner will make the journey to early FI so much easier and worthwhile… I’ve neglected this part, but once I fix my health, that will be my next goal — find a like-minded partner who’s even more enthusiastic about financial freedom than myself! 🙂

Take care!


5 J. MoneyNo Gravatar February 13, 2015 at 10:59 am

Interestingly enough, 10 of us bloggers just answered this exact question over at Daily Finance! 🙂

My answer:

My best investment I ever made was listening to my father 10 years ago and finally investing into my 401(k). It was the first time in my life I saw money actually pile up, and once I realized employers then give you money on top of what you put in, I was hooked. My pot grew from $500, to $5,000, to $50,000 and right on up to $200,000 before I left to go work for myself. Compounding is no joke with investing, and especially when you get free matches on top of it!


6 FI FighterNo Gravatar February 15, 2015 at 8:53 am


Yup, the 401k + match is one of the best decisions you can make… Free money and tax shelter! The only thing i don’t like is not being able to access the funds until way later (following the plans intended use, that is).

I wouldn’t say it was my best decision, but it’s definitely up there and my Roth IRA has more than doubled since we were at the bottom…

Compounding is the key to financial freedom! It’s power is incredible and that’s why I’m doing my absolute best to keep stacking up as many assets as possible. It will pay off tremendously later!

Keep on hustlin!


7 TawcanNo Gravatar February 13, 2015 at 11:14 am

My best investment is probably start RRSP contribution and taking the work’s RRSP matching policy. Free money is always good right?


8 FI FighterNo Gravatar February 15, 2015 at 8:54 am


Absolutely! Can’t beat or say no to free $$$! 😉



9 My Dividend PipelineNo Gravatar February 13, 2015 at 11:25 am

FI Fighter,

Making the decision to pay off my house in 2009 was my best decision. I will never forget the feeling walking into the bank in October of 2010 when I made the final payment. The tellers and bank manager gave me a round of applause as they handed me my receipt. In the years since, I have been able to focus on building my passive income.



10 markNo Gravatar February 13, 2015 at 11:52 am

kudos to you MDP. Thats awesome!


11 FI FighterNo Gravatar February 15, 2015 at 8:55 am


That’s so awesome, must have been the most liberating feeling to walk out of the bank that day!

You’ve definitely supercharged the passive income stream in the years since. Great plan and even better execution.

Best wishes!


12 JimNo Gravatar February 13, 2015 at 12:19 pm

My best investment decision was near the end of 2010 I sold three quarters of all my investments (I was 100% invested in Canada) and transferred the cash from CAD to USD and used it to buy US stocks. At that time the CAD was worth $1.05 versus the USD. Now the CAD is work about $0.80 which is 25% profit just on the cash. Since I invested that money in stocks, I have almost tripled my money in a bit over four years.

I was lucky enough to get into companies that took off like BAC, MCK, GILD, MA and DIS to name a few. It’s easy to look back and say it was a good idea, but at the time there was a decent amount of risk.


13 FI FighterNo Gravatar February 15, 2015 at 8:58 am


That’s some great timing there! Whether due to skill or luck, you definitely came out ahead with that move.

Thanks for the list of stocks… Great companies and they have done very well in recent years. I’m most interested at GILD at the moment, although DIS would be enticing with a pullback.

That’s interesting… In hindsight, many of the most obvious moves sure felt like huge risks at the time… I felt the same way when I purchased my first rental and overpaid by $65k or so… everyone thought I was crazy, me included lol

Take care!


14 NickNo Gravatar February 13, 2015 at 1:05 pm

I’m young, and working with little as far as investing, but I want to learn, and slowly but surely, become a wise investor.

The best single investment I think I made? I bought 1.081 shares of BP on 1/5/15. I used my old sharebuilder account as I found a promo code to get a free trade. (One of the reasons I don’t use sharebuilder much anymore is commission simply isn’t worth it most of the time.)
It is up by over 16%, and I know BP has a great dividend.

Other moves I’ve made that I know were smart, were reducing fees. I switched from this to using Lendingclub, Loyal3 and Betterment.

I even changed from betterment to Wisebanyan once I could, because zero fees. Moving some AT&T stock I received from my uncle out of computershares and to Ameritrade stopped them from cutting themselves 5% of the dividend I received when it got reinvested.


15 FI FighterNo Gravatar February 15, 2015 at 8:59 am


Great move, and BP is a solid large cap that should be around for a long time. This recent dip in oil may look like a great buying opportunity years from now.

Best wishes!


16 No Nonsense LandlordNo Gravatar February 13, 2015 at 1:58 pm

Not jumping in on investment properties in 2006/2007 when prices were too high. I made offers, but they were way too low for the ultimate sale price.

Then, in 2008, purchasing properties that met my investment objectives, and exceeded them. Today, they are producing a solid 6-figure profit, and have been for a few years.


17 FI FighterNo Gravatar February 15, 2015 at 9:02 am


Great moves all around! I bet it was tough laying off from purchasing properties in 2006/2007 since the mood around most everyone was that prices would keep soaring so you had better get in before it was too late! That was the vibe around here, and fundamentals and valuation went out the window…

It hasn’t quite reached that fever pitch yet today, but the local market has gotten extremely pricey, which is why I’m going to check out of the REI game for awhile…

I need another 2008 before I can invest back in with comfort and conviction.

Looks like those right moves post-crash are what are enabling you to retire well ahead of schedule! Great job!

Take care!


18 kyithNo Gravatar February 13, 2015 at 4:15 pm

best decision made was to put away $X a year into a ‘Wealth Fund’ and building a sound investment process.

I wouldn’t call any of my investment success of 100-200% gains as my decision. a rising tide tend to lift all boats so i attribute more to luck than talent in the equation success = luck + talent


19 FI FighterNo Gravatar February 15, 2015 at 9:04 am


Yup, everyone looks like a genius now with the markets at an all time high… It’s important to proceed with caution right now and stick to the plan without getting too greedy.

Easier said than done… But although I would love to acquire more properties, the numbers don’t work, and I’m doing my best to resist the appreciation seduction. I’m shifting gears and doubling up on my dividend growth stocks now.

All the best!


20 A Frugal Family's JourneyNo Gravatar February 14, 2015 at 11:39 am

The best investment decision I ever made was increasing my 457K contribution following the 2009 market collapse. I went from contributing 3-6% simply to get the company match to contributing 15-20% and maxing out my annual contribution for 3 straight years. Since then, my 457K portfolio has triple in value!! AFFJ


21 FI FighterNo Gravatar February 15, 2015 at 9:06 am


Excellent move and I’m happy it worked out so well for you! I wish I had bought more stocks in 2009, but it took me a few years of sitting on the sidelines before I was convinced to go in full force in 2012.

I am happy I maxed out the Roth IRA and 401k during that time period though 🙂

Take care!


22 Joshua MyersNo Gravatar February 14, 2015 at 5:42 pm

Paying off all consumer debt and getting on a budget. Hands down the best money decision I’ve made so for. I’m starting to think about paying off my real estate loans too.


23 FI FighterNo Gravatar February 15, 2015 at 9:07 am


That’s the necessary and right thing to do to get on the right track! Great job!


24 Gen Y Finance GuyNo Gravatar February 15, 2015 at 6:11 am

Second that Joshua Myers. We just paid off my wife’s car loan and only have our mortgage left. Which we are working to pay off within the next 7 years.


25 NazarNo Gravatar February 16, 2015 at 6:38 am

My best decision was knowing when not to buy. In 2006, stocks started getting overvalued, so I put extra funds into mortgage prepayments and paid it off in full. When I was laid off in 2008 during the great recession, I had zero debt and my only concern was finding a new job, which happened a few months later. At that point, Stock prices were an excellent value and I used my severance funds to buy various securities at a discount. I wouldn’t have been able to do that if my funds were spent servicing debt during that period of unemployment.


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