Courtney Myers Blog | Debt Recovery after an Investment Setback: Three Ways to Get Back on Track | Talkmarkets

Debt Recovery after an Investment Setback: Three Ways to Get Back on Track

Date: Thursday, August 30, 2018 5:38 PM EDT

For all the good that investing can bring, it can be equally powerful in the other direction in the event of a wrong choice. Say, for instance, you put a majority of your money into a tech stock that crashes quickly after it hits the market. Or, maybe you fail to properly balance your portfolio and a downturn on Wall Street ends up affecting your income more than it should.

Regardless, there are myriad reasons why you might find yourself in need of debt recovery services after an investment goes sour. While it’s never an easy thing to realize that you’ve made an unwise investment, the good news is you’re never too far gone to reverse the damage significantly. Here are three ways to reclaim your financial freedom and get back on track.

1. Ask for a refund.

If you’ve noticed your investment is bad off the bat, there is a slight chance you can ask for a refund on your money. Most are refundable for around 15 to 30 days if a refund is in the policy at all, though it may take longer than that for you to realize the how your decision will affect your bottom line. Sometimes, this part of the policy is known as the “cooling off” period. Even if you’re unsure whether or not it’s included in your terms, it never hurts to ask.

When you do, don’t automatically assume a refund is unavailable. Instead of asking whether or not you can get one, inquire about how to start the process instead. This may open up a conversation about how to reclaim at least a fraction of the funds you’ve already lost.

2. Know when to stop paying.

In the investment sphere, there is a thought process known as “sunk cost bias.” In short, this is the belief that because you have already lost money on something, you should go ahead and keep paying on it to avoid losing any more money and potentially recover lost income. Over time, we simply become attached to the things we’re paying on, even if it means we’re losing money at an astronomical rate, and we lose sight of the big picture. This is especially prevalent in the real estate investing sector. Say, for instance, you invest in a $2 million downtown condo, only to realize that the location isn’t as prime as you thought it was and the investment was unwise.

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