The Best and Worst Purchase
Please note: This article is not meant to provide investment advice, nor serve as a product endorsement.
Mid-pandemic, I went online and ordered a Peloton bike. Kim and I had made a commitment to staying healthy, eating well, and working out on a regular basis. It seemed the perfect time to set these goals— we had nowhere to go, our kids were out of the house, and we had nothing to do but stay home indefinitely.
Like most exercise equipment during that time, my bike was back-ordered. It took eight weeks to get it delivered. When it arrived on a Friday afternoon, I was so excited to test it out.
Initially, I wasn’t sure how to clip the shoes in. The seat was too low, the handlebars too high. Eventually, I was able to make all the necessary tweaks and adjustments for the bike to fit me just right.
I am proud to say that I have been using my bike every single week for two years. I love it. I know exactly what to expect when I get on it. I appreciate the instructors’ ideas and encouragement. I’m motivated by the community of friends and strangers I ride with. There is so much variety in terms of music choices— no matter my mood, I can find the right tunes. Last week I rode to Fleetwood Mac, as well as to songs from Broadway. Within the Peloton app, I’m easily able to track my progress. I appreciate that I can push hard for a 20-minute morning ride with an instructor, or I can choose a leisurely scenic option while I listen to a podcast.
The Peloton bike was a purchase I made after giving it much thought, doing research, and weighing my options. I talked with a lot of people about their Peloton experience to gather helpful endorsements. I have no regrets buying it. In fact, I feel like I have already gotten my money’s worth in just these two years.
Have you ever made a significant purchase, and were so happy about your choice to do so? That’s how I feel about my bike.
The Peloton bike is one of the best purchases I have ever made.
A year later, I also decided to buy Peloton stock. After all, I knew I wasn’t the only person enamored with my bike. Many people— millions, in fact— had made the same purchase as me during the pandemic. No surprise that the company had done incredibly well during 2020-2021.
On the day I bought Peloton stock, I thought I was quite savvy. Although the market had been going up, Peloton stock had experienced a slight dip in price. I assumed it was from the recall they had with their new treadmill. But that was just a hunch. I did no research. I did not consider that gyms were reopening, and people would begin canceling their Peloton subscriptions. I didn’t look into who was running their company, what their overhead was, or that they were paying a significant premium to fly bikes from overseas via airplanes because cargo ships were taking too long. I didn’t look at the historical price of the stock, nor what any outside source was predicting for the company moving forward. Unlike my very deliberate purchase of the bike, my Peloton stock purchase was reactionary, on a whim, and not well thought out.
At all.
I bought the stock for $128 a share. I didn’t look to see that the 52-week high had been $129. I had made my purchase as the stock began its downward slide.
Today, as I write this story, Peloton stock is selling for $9 a share. I am officially down 93%.
Peloton stock is one of the worst purchases I have ever made.
Today— I kid you not— my bike is worth more in value than my stock.
Have you ever made a purchase, and soon after regretted it? Maybe it was an expensive watch, an overpriced pair of sneakers, or a pricey vacation— and afterwards, you wished you could go back and undo it?
Me too.
I’m not saying that the Peloton stock will never recover. I’m simply pointing out that I didn’t follow my own advice: Instead of sticking to tried-and-true principles, and making a stock purchase based on sound fundamentals, I was driven by emotion and spontaneity. This is not the advice I would have given to a client, yet I took it for myself.
I find it (almost) funny that the decision to purchase a Peloton bike was a deliberate investment in my health and wellness. At the same time, the purchase of the Peloton stock was mathematically one of the worst things I have ever placed in my portfolio.
My timing for one purchase was excellent. My timing for the other was terrible.
As I rode my bike this morning, I found myself feeling grateful for how well it has served me these past two years, and how strong my legs have gotten. I appreciate the sweat and stress I am able to leave on the bike following every ride. No buyer’s remorse here.
As I think about my plummeting Peloton stock, understandably I wish I’d never made that purchase.
There comes a time, however, when we have to move on.
At some point, regret and disappointment no longer serve us. We have to forgive ourselves— and trust that there was a lesson to be learned in our mistake, big or small.
That’s what I’ve chosen to do with my stock: forgive myself and move on.
Keep my story in mind as you enjoy the year, go on a much-deserved vacation with your family, and maybe even treat yourself to some new things for the holidays. We all work hard for the money we earn. Let us invest time and effort into thinking in advance about purchases we are considering making, assess their potential impact on us, and proceed after thoughtful consideration.
This Week’s Resources
The Savannah Bananas
Are you someone who appreciates a great success story? Then you must read about the minor league baseball team that transformed what it means to have outrageous family fun at the ballpark. Watch this video to learn more about the most creative marketing plan ever: savannah bananas
Project Repat
Did you know that the average American trashes about 65 pounds of clothing per year? Did you also know that in the ‘80’s the majority of t-shirts were made in the USA, but today most of those textile-related jobs have gone overseas? Project Repat is helping to bring jobs back to the United States by recycling your t-shirts and turning them into meaningful high-quality quilts for you and your family: Project Repat
Three Cheers for the Red, White & Blue
On this 4th of July week, do you ever wonder about the history of our American Flag— the one that inspired Francis Scott Key to write a song that would become our national anthem? Read here for some insight and patriotic history: star spangled banner
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