June marks Elder Abuse Prevention Month. At a time when 70% of the nation’s wealth is controlled by Americans over 50 years old, fraudsters are using new tactics to take advantage of retiring baby boomers and the growing number of older Americans. And while some of these criminals are strangers, most often elder financial abuse is committed by family and friends. So, what can you do to protect yourself and your loved ones from elder financial abuse?
Protect Yourself – In many cases, exploiters and abusers are often people you interact with regularly. They can be charming, yet forceful in their attempt to gain control of your finances. If you feel intimidated or manipulated, trust your instincts and avoid anyone who makes you feel this way. Some proactive measures you can take now are:
- Add a “Trusted Contact” to your bank and investment accounts. A Trusted Contact is someone your bank or financial advisor can call if they suspect fraud or financial exploitation.
- Build a relationship with your attorney and your CERTIFIED FINANCIAL PLANNER™ Differentiated from other financial advisors, CFP® professionals are known for their commitment to high standards of competency and ethics. These are two professionals you will want available to you and familiar with you in the event you suspect financial abuse.
- Shred receipts, bank statements, and unused credit card offers before throwing them away.
- Never give personal information like Social Security numbers, account numbers, or financial information over the phone, unless you initiated the call and the other party is trusted.
- Never rush financial decisions. Ask for details in writing and get a second opinion.
- Never pay a fee or taxes to collect sweepstakes or lottery “winnings.”
- Check references and credentials before hiring anyone. Don’t allow workers to have access to information about your finances.
- Avoid sharing personal information on social media. Information, like your favorite actor and your mother’s maiden name, can be pieced together with other publically available information to hack your online accounts.
- Be wary of predatory lenders and salespeople pressuring you into an inappropriate reverse mortgage or pushing an expensive annuity that may not mature until you are in your 90’s.
- Remain extra vigilant after the loss of a spouse. Bad actors browse obituaries and prey on widows and widowers, often under the guise of an unpaid creditor.
- Don’t sign documents that you do not fully understand.
- Feel free to say “NO.” It is your money!
Protect Your Loved Ones – Many older adults live alone and depend on others for care. This can put them at a greater risk for financial abuse and exploitation. Be their champion by recognizing red flags, which can be spotted in changes to established financial and behavioral patterns.
- Unusual activity in a bank account and unpaid bills
- Frequent expensive gifts to caregivers
- Adding caregivers to bank accounts
- Frequent checks made out to “cash”
- A series of loans to a friend or family member with no repayment
- Sudden change in beneficiaries
- Doesn’t want to talk openly about your concerns
- Caregiver prevents others from visiting
Like other forms of abuse, the consequences of financial abuse are long-lasting and deprive the victim of resources, peace of mind, and in many cases their independence. While some seniors may need help with their finances unless they willfully hand control over to another person, they have the same right as anyone else to receive, spend, invest, save or give away their money. By law, Texas residents are required to report known or suspicious elder abuse. You can report elder financial abuse by contacting Adult Protective Services at 800-252-5400 or online at TxAbuseHotline.org.
Published in the Victoria Advocate
Hannah Gohmert is a CFP® professional and IACCP (Investment Advisor Certified Compliance Professional) with KMH Wealth Management, LLC. She specializes in investor protection and is the Chief Compliance Officer of the firm.