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Beware! These Scams Cost Seniors Billions of Dollars Annually!

If you want to protect your assets, here’s a warning you’d better pay attention to. The scam artists are out there, and they are preying on seniors. What makes older Americans such a tempting mark for these financial criminals? This article that just appeared on the website GoBankingRates.com has the answer: “When you have a lifetime of savings,” the article says, “you’re a prime target.”

Because we at AgingOptions are committed to helping you enjoy a safe and fruitful retirement, we’re passing this very helpful article along in hopes that it will prevent you, or someone you love, from getting victimized. The piece is called “Protect Yourself from These Ten Scams Targeting Retirees.” In the past we’ve written on the AgingOptions blog about scams that specifically target veterans (including this blog post which appeared last fall) but this exposé is far more comprehensive, listing the kinds of frauds so cleverly devised that they could conceivably fool practically anybody.

The statistics on fraud in America are truly alarming. The Better Business Bureau reports that roughly 25 percent of U.S. households have been impacted in some way by scams, which cost the nation’s economy an estimated $50 billion annually. Tragically, however, seniors are the ones who bear the brunt of this financially and emotionally devastating epidemic of fraud. According to this just-published article from the Huffington Post, those aged 60 and older made up more than one-quarter of all the fraud complaints tracked in recent years by the Federal Trade Commission, the most of any age group. One study claims that one in five Americans aged 65-plus have been financially abused, to the tune of more than $36 billion.

Preventing fraud is the responsibility of both seniors and those who care for them, and it often starts by making sure someone besides the retiree has access to appropriate financial information. As the article puts it, “Individuals can protect themselves by making trusted family members and financial advisers well aware of their money matters and informing them of any scam suspicions.” That’s all the more reason why adult children should be actively involved in protecting a parent in need – even though stepping in might prove awkward. As one elder law attorney said, “Don’t be shocked if your parent is defensive about this. They don’t want to admit they were scammed or they might be embarrassed that they lost money.” He added that adult children and other caregivers “need to be very diligent about wanting to help them and to be watchful, because once the money is gone, they’ll likely never be able to recover it.”

So here, very briefly, are a few highlights – or “low-lights” – from the GoBankingRates.com “Top Ten List” of common scams that are particularly aimed at seniors. We lack the space to cover all ten but here’s a sampling of most of them.

  • The Social Security Scam: Someone claiming to be from the Social Security Administration calls to say you’re entitled to a benefits increase – all you need to do is to verify your personal data. Don’t fall for it! Social Security will never make such a call.
  • IRS Scams: In this common scam, someone supposedly from the IRS calls to tell you you’re late on your taxes and about to be hauled into court. Or in a more positive variation they say you’re owed a refund from a previous year. All you have to do is call a number to verify your account. This is one hundred percent false! If the IRS wants to reach you, you’ll get a letter, not an unsolicited phone call. Hang up immediately.
  • The Grandkid Scam: A young person claiming to be your grandchild calls to say he or she is in trouble and needs you to wire some cash immediately. Be very skeptical and never offer a name by saying “Is this Robbie?” or “Is this Jane?” The article says to “be very wary about any high-pressure tactics that demand immediate funds,” especially wire transfers. Instead, hang up fast and, if you’re worried, call your family to make sure your grandchild is okay.
  • The Computer Virus Scam: There are many variations of this increasingly common type of fraud. One scheme: someone sends you an email that contains a computer virus, and your computer becomes infected. Up pops a toll free number you must call for “technical support” to eradicate the virus – for a fee, of course. Beware of any and all emails from sources you don’t trust – and when in doubt, delete.
  • The Employment Scam: Some seniors have been scammed by responding to fake employment ads. During the application process they divulge personal information including Social Security numbers. Don’t do it! Experts advise you to thoroughly research potential employers and never offer sensitive financial or personal information up front. “Keep in mind,” said the article, “that legitimate employers don’t require data such as your Social Security number until after you’ve accepted a job.”

Of course, there are more scams and frauds, because the criminal mind is endlessly inventive. Sometimes they claim you failed to respond for jury duty and you owe a fine – but first you have to confirm your Social Security number. Other scams involve phony home repair inspectors, fake on-line dating ads, and bogus promises of big lottery winnings (if you’ll just pay a small “administrative fee”). These are all 100 percent fraudulent, designed to do one thing: to rob you of your money, through direct payments or through identity theft.

So what is a careful senior to do? Prevention is the best cure, and that demands caution and vigilance. Seniors need to be wary and well-informed. We found one excellent resource through the AARP: the organization offers a Fraud Watch website with a special helpline – 877-908-3360 – where you can share your story and get assistance if you fear you’re the victim of fraud. And as we said above, seniors and their family members must be honest and transparent with each other. One way this honesty can begin is through an AgingOptions family conference where parents and adult children can gather under the guidance of one of our experienced professional staff members and review a whole host of retirement-related issues. Families with whom we have met say these conferences were absolutely essential in preparing for a successful retirement for mom and dad – fully supported by the family.

Another key step is for you and your loved ones to attend a free AgingOptions LifePlanning Seminar with Rajiv Nagaich. There you’ll discover how vital it is that your retirement plan be multi-faceted, blending together your finances, your housing choices, your medical protection, your legal affairs and your family communication strategy. That kind of integrated planning is only found in an AgingOptions LifePlan. To discover this powerful planning tool for yourself, visit our Upcoming Events page and register for the seminar of your choice. It will be our pleasure to help you put your retirement adventure onto the right path. Age on!

(originally reported at www.gobankingrates.com)

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