The most money I’ve ever lost
Several years ago, my husband and I were planning to build a house. We bought the land and cleared the build site. We then started working with an architect, which is how we lost $12,500 in a matter of months.
Here's how it went down.
When I hired this architect, whom I now refer to as He-Who-Must-Not-Be-Named, I thought I'd done my due diligence. The guy was profiled as one of the top architects in green building. He specialized in the type of house we wanted to build. We met with him, we toured two homes he designed, and we met with one of his past clients.
After a couple of meetings to discuss rough sketches and photos of the design elements we wanted, we seemed to be on the same page. So we signed on the dotted line and sent him the first payment.
Things went well at first. He sketched a design that was almost what we wanted, but not quite. “No problem,” he said. “I can make those changes.”
Weeks later, we got back a new design. It looked nothing like the first design. Everything was different, from the elevation to the square footage to the room layouts.
I told him that I actually liked the very first design; we just wanted those few changes we'd discussed. I got back a third design that looked nothing like the first two.
It was pretty bizarre. Some of the weirder changes included replacing a staircase with an attic ladder and designing a tower that actually leaned, like some sort of purposeful Pisa or something. My dad, a stone mason with 30+ years of construction experience, was dumbfounded, and losing his patience.
Still, I kept my emails to the architect civil and professional, trying to work with him so we could get some finalized plans.
Finally, he sent over the finished plans. Again, they were completely different than what we'd discussed. And they were incomplete. We took them to a contractor, who verified this. As it turned out, the contractor actually knew He-Who-Must-Not-Be-Named by reputation, and the reputation wasn't good. My stomach sank.
When I tried to talk to the architect, he got defensive. He insisted that the plans were complete, and he said that our changes were the reasons that the plans were so wildly different from one round to the next. Now, I do get that one change can necessitate other changes. Only, he didn't actually incorporate the changes we'd requested. The plans were just different. It became clear that we weren't getting anywhere, and then he started copying an attorney on his emails to me.
So, things ended badly. We were already $12,500 in the hole, and I refused to send him the final payment without complete plans. He threatened to put a lien on our property, so I consulted an attorney in my family. Basically, the attorney said that if The Dark Architect tried to put a lien on our land, we could do something about that. But as far as getting our money back, he said we'd have to go to court, and he didn't recommend that course of action. Apparently it would open us up to greater liability, and it wasn't worth it for $12,500.
I was angry and sick to my stomach. That was no small sum to us. It took a lot of time and sacrifice to save our money, and now we had nothing to show for it. The plans were worthless.
Although we lost what was a significant amount of money to us, to others, it's pennies. For instance, entrepreneur and author James Altucher has written about his experience with losing a million dollars a month until he was eventually flat broke.
After James sold his first company for $15 million, he lived it up. “I bought an apartment for millions, he writes. “I rebuilt it. Feng Shui! I bought art. I played a lot of poker. I began investing in companies. A million here. A few hundred thousand there. One IPO I put $2 million in at $20 and watched it go to $0. They made wireless devices for deaf people. Huge market.”
He started a company; he invested in companies. Then came the bubble burst. “From June 2000 until September 2001, I probably lost $1 million a month,” he says. “I knew nothing about stocks or valuations or anything resembling rational thought. I doubled down. Then quadrupled down. Then 8-upled down. I couldn't stop. I was an addict.”
His account balance was spiraling toward zero. “I felt like I was going to die,” he writes. “That zero equals death. I couldn't believe how stupid I had been … I was going to zero and nothing could stop it. There were no jobs, there was nothing. “
He lost his house, he couldn't sleep, he dropped down to 130 pounds. “I went from feeling immortal to feeling dead all over,” he writes. “There was never a moment when I didn't feel sick. I had let everyone down forever.”
Finally, he decided he could either wither away and die, or he could feed his family. So he focused on his health and well being, and eventually, he was making millions again. Which he lost, again. And then he made it back a third time.
“And I hope I can keep building,” writes James. “I hope I don't revert to my addictive tendencies. I think this time I learned. Every day without fail I focus on physical, emotional, mental, and spiritual health.”
It's quite a story (and worth reading in its entirety). [Editor's note: This link to James Altucher's story requires that you confirm your email address in order to read the story.]
An Expensive Lesson Learned
As for the conclusion to my own story, the architect never tried to put a lien on our property. It was just an attempt to scare us into making another payment. And while I'd love to say that I let it go long ago, the truth is that I rarely talked about the situation because his name brought up feelings of anger and frustration for years, hence the He-Who-Must-Not-Be-Named moniker.
“Unless you're Mark Zuckerberg, who, while he lost several billion on the day of the Facebook IPO still was worth billions of dollars, a significant financial loss is going to hurt you, financially, emotionally, and spiritually,” says Jason Hull of Hull Financial Planning. “Address all of the aspects of the loss so that you can move on.”
Today, I have moved on. Time has passed. And more significantly, my priorities radically shifted when my friend Frank passed away last year. I just don't care about losing that money or feeling suckered anymore. And in many ways, we were lucky. Losing the money didn't put us out on the street — it just sucked, was all. So now I'm able to chalk it up to a very expensive lesson in one of our GRS tenets: No one cares more about your money than you do.
Readers, what's the most amount of money you've ever lost? How did you react, and what did you learn from the experience?