It doesn't matter if you're rich or not, this information is something to keep in mind in your life too!
1.Assuming the people you are with are honest and trustworthy when going abroad.
While servicing investment banking products I received a call from one of our wealthiest clients on board ship in the middle of the Baltic Sea on his way to France. He was pick pocketed on board. He had all his credit cards, phone numbers and information in his wallet and it was suddenly gone. Although his problems stopped with me, I'm sure the rest of his trip was less than pleasant do to worry.
Those uninitiated to foreign travel, no matter how much or how little they are worth are vulnerable to the cultures of other countries. There are some cultures that believe that no mater how wealthy they are, if it's not nailed down it's theirs. Write down the names and numbers of all your financial institutions, etc in the event of the worst happening. Keep that in a safe place, not on you when out in public. Leave the wallet at home and buy a money belt. You are far less likely to have it taken when it's close to your body.
Wealthy people stick together. They all understand the processes they had to go through to get there and keep it there. They can get used to sticking around people who are honest and trustworthy, letting their guard down.
2. Assume you are going to live forever.
So you are loaded. You are a self made millionaire, or maybe you're not. You control all financial decisions and know where your hard earned money goes. Even if you know where every last nickel goes, people make this mistake.
All your financial accounts are in your name and your name only. You were ever so kind as to make your spouse a signer on one of the credit cards. Everything else is in your control completely. Knowing you have a ton of money stacked up you have taken out a life insurance policy to make sure your spouse is taken care of for the rest of their life without you. You're all set, well covered and ready for anything. Or are you?
I received a phone call late on a Friday afternoon. On the other end was a woman standing in her morticians office trying to buy two caskets and to grave plots with no credit of her own and nowhere near the $10,000 necessary to buy them. Her husband just had some kind of circulatory problem that day sending him to the hospice. Her financial adviser went on vacation for a week and his office was closed. She would have to wait 10 days just to talk to the receptionist about talking to him! We got her to agree to getting $10,000 from her credit account as she wouldn't be charged interest in the mean time.
This man did everything right, except one thing-plan and make final plans for the end of his life. His wife ended up having to do it all. She also had to establish credit in her name. This can only lead me to believe he loved his money more than his wife!
3. Believe that because you've never needed credit you never applied for credit. So you can buy everything with cash. You have money piled up and accessible just needing your signature.
One man wanted to take advantage of a great interest rate and investment banking product that required him to apply for a credit card. Even if he had a card with this credit company he still would have to get another one that worked with the product. So he applied. He was promptly turned down. Why? Not because he didn't have enough money, but because he had no credit history. He paid cash for everything!
While it's true that paying out interest is money going down the drain, however it is a necessary evil. Without credit history there are some financial products not available to you. So if you get a card, use it and pay it off when the bill comes. You will find that with discipline, using it to move money will be very convenient and safe. Just check your bill once a month.
4.Assume just because you were given a loan, even a mortgage loan, that your credit is good. Even an underwriter can let a ding on a credit report go by because the rest of your credit history is beautiful. That one problem can, over time, become a minor headache. Yes, I've seen this happen too. Have it pulled anyway. If there's a problem, make the phone calls to find out what it's all about.
I had a young newly wed wife on the phone and she was already knee deep in moving boxes, phone calls and trying to make dinner at 3:00 in the afternoon. She started crying when I was doing the research for this minor glitch I knew would be better solved by me than her. I told her to continue to unpack and I would nail down the culprit myself and call her the next day. Sure enough the bank who put it there didn't find it in their records and sent me a fax saying so. They would clear it right away. So I called with the good news, made a copy of what was sent to me, put it in her closed mortgage file, and sent her the other one. I also wrote instructions to do the follow up to ensure it was done to her satisfaction. Did this make any money for the bank? No. What it did was build a healthy relationship with the customer.
5. Trusts gone awry.
So you're a trust baby. (this is what we call you in the industry). How much money do you have in your account this month? We get this all the time. We also get to patiently listen to your story about the perfect sports car you found and hope to get it soon. We stuff in the appropriate "ooo's" and "ahhs" tell you how much you've got and send you on your way. But what happens if you're not around to contact in the event of the very smooth process becoming less than smooth.
One couple spent six months every year out on their sailboat. No technology, no cell phones, nothing. When they finally do come into port she goes to the local library and uses their computer to check their balances. Oops! This time something didn't look right. The balance was zero. I was the lucky one to receive the call from the irate woman.
Sailing away for 6 months out of the year sounds wonderful, but with no way to contact you in the event of a problem is just asking for trouble. Anything in the electronic world can go wrong and is usually solvable via the telephone, if you're near a working telephone. If not you could be in port with no way to pay for docking fees, supplies, fresh water or food. If nothing else check on your accounts by going to port at least once a month. You'll be able to eat that way.
6. Last but, certainly not least. Assume you have so much money you can treat people any way you want! Did you know we will perform only the amount of work necessary to get the job done for a customer that wants to bite everyone's head off? These financial organizations have excellent staff working for them. Some of which have 20 year track records with glowing reviews and awards. Beating these people up will not produce more because you have a big mouth. We will go above and beyond for those who are average people who just want to get their financial chores done. I saw one customer who after two years of he11, again threatened to take all his money out of the bank. The VP took him up on his threat and said fine go. Why? Their highest achieving banker collapsed on the floor after trying to satisfy the craby old goat!
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