Peruvian Lessons on Good Financial Planning

A couple of years ago, I came across an article about a Peruvian man named Jorge Villanueva, whose story, while unfortunate has a great deal to say about financial planning. According to the article, Mr. Villanueva was scheduled to have an amputation on his left foot at a hospital in Callao, Peru. On the morning of his surgery, everything was going according to plan as he was wheeled into the operating room.
Recovering from the operation, the surgeons commented that the procedure was a success and he would be able to return home soon. Everything seemed fine until Mr. Villeneuve’s daughter, Carmen, arrived and got the surprise of her life. Confused at first, she looked at her father several times. After convincing herself that what she saw was true; it was clear the doctors had made a mistake: Mr. Villanueva’s healthy right foot was gone and the left one remained. The surgeons had operated on the wrong foot. With the mistake brought to their attention, the surgeons performed another operation to remove the left foot. Today, thanks to a simple mistake, Mr. Villanueva has no feet.
At first, it seems like such a simple mistake like this would be nearly impossible to make. With teams of nurses and surgeons on the case, the fact that each would let such a seemingly obvious detail slip by them is almost unfathomable. The truth is, these mistakes happen all too often as physicians and nurses are often too committed to the general process of a procedure to notice specific details.
As I read this article, it hit me that a wealthy client has a great deal in common with Mr. Villanueva’s situation. The client goes to see a financial advisor with a very healthy net worth that does not need to be tampered with. Despite this, however, the financial factory convinces them that they need to have their finances undergo a new process to not only preserve, but grow their net worth. With this errant focus on a one size fits all process, the wealthy client’s net worth is often amputated and significantly reduced. Much like Mr. Villanueva, the only option at that point is to adapt to a new lifestyle of less.
For people with a healthy net worth, many financial advisors will be constantly trying to convince them that they need to be put under the financial knife and often times the consequences are disastrous. With that in mind, it is important for high net worth individuals to focus on reliable wealth preservation. Instead of focusing on the latest flashy financial procedures, high net worth individuals would be well served to focus on consistent, proven strategies to protect their hard earned wealth.