Financial scams may be the crime of the 21st century. They are on the rise, and older adults are often the targets because they are more trusting than younger people. You should plan ahead to protect yourself and the people you love from these scams and safeguard life savings. Money Smart for Older Adults, from the Consumer Financial Protection Bureau, offers important advice.
- Guard against identity theft. Never provide personal information to a stranger on the internet or even to someone on the telephone. Scammers may pretend to be from a government agency or a grandchild in desperate need. Government agency staff will never call or email you and ask for personal information. If the person claims to be a family member needing money desperately, to protect yourself and make sure you’re talking to the right person, ask to call them back. Then, check that the caller is who you think it is with another family member.
- Protect against caregivers in your home you don’t know well: Lock your jewelry, checks and financial documents in a cabinet.
- Keep a list of phone numbers for your financial services providers, including for your bank, credit card companies, brokerage firms and insurance companies, as well as important account numbers, including your bank and brokerage accounts, credit card numbers and homeowner’s or renter’s insurance.
- Plan for the time when you cannot manage your own finances.
- Check the background of your financial advisor through the Financial Industry Regulatory Authority or FINRA at www.FINRA.org.
- Beware of reverse mortgage scams and lottery scams. Never pay money to someone who claims you have won a lottery. And, remember that if you did not enter the lottery, you could not have won it. And, while some reverse mortgages may be legitimate, you want to be very careful about getting a reverse mortgage.
You should beware of funeral scams as well, according to the FBI. Scammers have gotten tens of thousands of people to give them millions of dollars to prepay in full or in part for their or their spouse’s funeral.
In addition to financial scams, financial exploitation of older adults is not uncommon. In many cases, family members are the perpetrators. The National Center on Elder Abuse reports on one study showing that nearly 60 percent of the time family members committed financial exploitation of older people (57.6%). Friends and neighbors committed financial exploitation 17 percent of the time and home care aides 15 percent of the time.
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