6 personal tales of bad financial decisions

Sucked into a Ponzi scheme
Sucked into a Ponzi scheme © Keith A Frith/

Aimee Elizabeth of Las Vegas made the mistake of investing in real estate, specifically trust deeds, in which a borrower is a property owner in need of cashing out part of the property's equity, and traditional financing won't work. Investors may own all or a portion of a trust deed.

After the housing bubble burst and real estate dropped in value to far less than the amount owed on the land, trust deed borrowers quit making payments and the agent of the business "started robbing Peter to pay Paul, and it turned into a giant Ponzi scheme," Elizabeth says.

The trust deed business filed for bankruptcy and investors such as Elizabeth were out of luck. "I was extremely emotionally distressed at this error in my judgment," says Elizabeth, author of "Poverty Sucks! How to Become a Self-Made Millionaire."

The company that took over from the bankrupt loan servicer of the trust deeds even sued her. But she realized she was one of the lucky ones, as other investors were retirees who had made bad financial decisions and lost their nest eggs.

"I had only invested about 20 percent of my total net worth in this company," she says. "I still had more than enough to pay my bills, and I have been working to earn back the lost money. It's been almost seven years of stress."


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