4 Ways to Safeguard Seniors’ Savings Against Elder Financial Abuse
4 Ways to Safeguard Seniors’ Savings Against Elder Financial Abuse
By Michele Kryger, head of AIG’s Elder and Vulnerable Client Care Unit
Babyboomers.com Staff

AIG’s Elder and Vulnerable Client Care unit prevents, detects, investigates and reports elder financial abuse

Elder financial abuse is a pervasive and expensive problem estimated to rob America’s elderly of billions per year.

Adding to the issue, academic research uncovers a jarring juxtaposition as we age: our confidence in our financial abilities stays constant, while our financial literacy drops off dramatically—showing that even if we feel perfectly capable of going it alone, we may be slowly losing the ability to continue to make prudent financial decisions.

In the current environment, with new scams and as social distancing increases senior isolation, it’s paramount to take steps to safeguard seniors from financial abuse. Yet, one in two seniors 65 or older handle their money entirely alone, leaving themselves vulnerable to scams and financial exploitation, according to the AIG Plan for 100 Elder Financial Abuse Survey.

As Boomers take steps to safeguard their elderly parents’ finances against scammers and bad actors, it’s important to remember that the best time to plan for yourself is before you need it. Here are 4 ways Boomers can fortify their parents’ hard-earned savings—and, just as importantly, their own as well—against elder financial abuse:

1. Know the scams to look out for

Awareness is the first step to helping seniors safeguard themselves against potential financial threats. Seniors should get to know some of the most common financial scams:

  • IRS Impersonation Scams: These are calls pretending to be from the IRS claiming that you will be arrested if you don’t pay up on missing taxes. Keep in mind that government agencies rarely call people. Adding your number to a do not call list can help limit these types of calls.
  • Robocalls and Unsolicited Phone Calls: According to the Federal Communications Commission, there are nearly 2.4 billion robocalls made every month. Don’t respond to calls, texts or emails asking for urgent personal information unless you initiated the call.
  • Lottery/Sweepstakes Scams: In this scam, seniors are made to believe that they have won a lottery and need to pay a fee to collect their winnings. Even after seniors send the money, they get many daily calls demanding more money.
  • Grandparent Scams: Imposters pretend to be your grandchild or an authority figure holding your grandchild. They claim the grandchild is in trouble and needs money to help with an emergency. If you are unsure if you are being scammed, ask some simple questions that only your grandchild would know the answer to.
  • COVID-19 Scams: The Federal Trade Commission has sounded the alarm on products falsely claiming to treat or prevent the novel coronavirus, as well as fake charities. Be wary of alleged government calls to set up COVID-19 tests and avoid phishing emails touting vaccinations and home test kits.

2. Work with an advisor to plan…long before you need it

It’s easiest to work with your parents to set them up for success long before cognitive decline occurs. By starting these conversations early, while the family member is still sharp mentally, you can help ensure their wishes are carried out. Similarly, think about building a plan for yourself before it feels like a pressing issue so you can steer the process and safeguard your own wealth.

The AIG survey found that working with a financial advisor increases the chances that smart choices, such as putting into place a Power of Attorney, are made to help prevent financial exploitation. Financial advisors can also be of assistance to clients in protecting their assets because of their unique position to spot red flags of exploitation or fraud.

3. Involve a trusted loved one

As a caregiver, you can act as a trusted loved one to keep an eye out for bad actors. It’s important to recognize warning signs of vulnerability in your parent, such as withdrawal, forgetfulness or depression. You may also be able to assist with reconciling account statements, finding local resources, and verifying credentials for doctors and caregivers. Finally, get to know the people in close contact with your loved one and take note if a new, unknown person seems to be playing a big role in their life.

4. Report suspected abuse

Only one in 44 instances of elder abuse are reported. If you believe you or a loved one may have fallen victim to one of these attacks, use the Department of Justice’s Elder Abuse Roadmap to report abuse to the right government agency.

Whether you’re focused on protecting yourself or an aging parent, building a system of checks and safeguards can help your family protect hard-earned savings and secure your financial future.

 

AIG is the marketing name for the worldwide property-casualty, life and retirement, and general insurance operations of American International Group, Inc. For additional information, please visit our website at www.aig.com

 

 

 





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