It was only yesterday when I was $5,000 richer.
With the market in such volatility, it was a great time to invest since I was in it for the long term. So, I made my 2008 contribution of $5,000 into the Roth IRA a couple weeks ago. It was such an easy process because I have an ETrade savings account and an ETrade Roth IRA account so it was done a couple of clicks later. A few weeks go by, I log into my ETrade account and noticed that my account balance went down $5,000!
I searched around, and realized that there was a new transfer payment of $5,000 from my online bank account to my Roth IRA. After more searching, I realized what has happened. ETrade increased my Roth IRA balance by $5,000 but did not decrease my online savings account when I made the transfer originally, and only made the adjustment yesterday.
Ahh! I was lucky this time because there was no financial impact but what if I already planned to use that extra $5,000? What if I already bought the flat screen TV purchase I spoke of yesterday on my credit card and prepared to pay for it with that $5,000?
Even though I was annoyed as a customer, I should first look at myself and see how I can help to make sure I don’t mistakenly allocate money that isn’t mine.
It doesn’t need much brain power to figure out that I was just careless in this case. I should’ve known that my balance was inflated by $5,000 after I funded my ETrade Roth IRA contribution. I was just happy to look at my account balance and wasn’t sensitive enough to see why it seemed inflated to being with. If I purchased that TV, then it’s my fault because I carelessly thought I had money that I didn’t have.
In the above example, the cost is relatively small because we can always refund the TV. If the same situation happened with $50,000, the cost and consequences could be much bigger.
Look, we are all careless at times. We just need to pay attention to things that are more important like our finances. I know I will from now on, so I don’t start off an article in the future with something like… “It was only yesterday when I was $50,000 richer”.
- E*Trade IRA - Official Site
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I’m glad that it didn’t really affect you this time.
I agree though that we really need to make sure we are on top of our finances because there is so much room for mistakes and it can be very costly.
That’s fairly typical of financial transactions. That’s why I always go straight to my Money Plus software to see where I really am at because everything is accounted for. Sort of a mental check and balance on my laptop versus what’s online.