I have a confession that, as a sage financial professional, is somewhat embarrassing to make. Many years ago, I lost money investing in a friend's company because I didn't have the heart to say no. That was dumb. Had I had the guts to tell him that I didn't think his plan was well thought out and what issues I had, he may not have invested so much of his own time and money in a flawed concept. While I lost money, the money was not totally lost. I learned a lesson about being more direct that has served me well.

All of us make dumb money decisions, but how we recover and learn from them is what will make the difference in your financial future. Here are some that I most commonly see.

People come into my office owning financial products they bought that they didn't understand and are virtually impossible to exit without high costs. The lesson is not only to buy things you understand. While that sounds great, it is really not practical. Instead, the lesson is to make sure that you ask questions that may give you options. For example, if someone is selling an annuity with all sorts of guarantees, you probably won't understand it (I suspect they may not fully understand it). Rather than simply succumb, ask some nontraditional questions: If I realized this was not what I should own or my life changed, how much would it cost me to get out of it? What are some different solutions that could make sense for me? In what types of situations would I be better off with something else?

We have had several clients come to us unhappy with time shares that they bought. They were induced to make the purchase while being wined and dined and eventually worn down. Some clients are happy with their purchases, but there are many who aren't. The lesson isn't don't buy a time share. Instead, when making decisions for either large amounts of money or large ongoing costs (which could be anything from buying a pet to joining a country club), don't make your decisions on the spot. Sometimes you have to avoid the temptation — if you are not ready for a pet, don't visit the Humane Society. But other times you have to walk away so that you can give yourself enough time to think things through. If you develop a T-chart with the good on one side and the bad on the other, you will make a better decision.

Once you realize your mistake, don't live with it. Get out if you can. The best money educations come from the worst money mistakes.

Spend your life wisely.

Ross Levin is the founding principal of Accredited Investors Wealth Management in Edina.