How to keep your assets safe

As you get older, you become more vulnerable to financial exploitation, often by the people who have the easiest access to your money.

Tags: Scams, Asset protection, Planning
Published: May 30, 2018

Elder financial abuse can be a significant issue as you age. Nearly $37 billion is lost each year as a result of financial exploitation perpetrated against seniors, according to Bloomberg.

Financial exploitation is a form of abuse that involves the taking or misuse of an elderly person’s financial resources. The elderly person may put their trust in a family member or caregiver to help manage their money assuming that person has their best interests in mind.
 

When trust fails

In some cases, people become unwitting victims of the very people they trusted. Perpetrators tend to be families, friends, neighbors and caregivers. Examples of financial exploitation include:

  • The outright theft of a senior’s financial resources.
  • Manipulating or coercing the senior to give the perpetrator money or property.
  • Using the senior’s credit or debit cards to make purchases for personal needs.
  • Borrowing against the value of the older person’s home as a way to access money.
  • Misusing power of attorney control that has been granted.

And the Internet has created a whole new venue for exploitation. Business opportunities, online dating, chat rooms and online shopping are some of the platforms that other perpetrators utilize to exploit elderly individuals who might be isolated, lonely or just bored.
 

Guarding yourself

An awareness of the potential for financial exploitation is the first step. Here are some important measures older customers can take to prevent financial exploitation:

  • Ensure that you have updated your will and any other important documentation, such as advanced health directives, trusts and powers of attorney.
  • Ensure that you communicate well with any person you have assigned as a power of attorney that they understand the role they are taking on and that you are confident they will continue to carry out your wishes if you become incapable of making important decisions later in life.
  • Review all beneficiary designations for retirement accounts, bank accounts and insurance policies to make sure they are current.
  • Communicate your goals, objectives and future plans to carefully chosen individuals you trust. Make sure they are a part of the conversation early and that you are clear about your goals and wishes.
  • Learn about common financial exploitation schemes and ploys so you can be on the lookout and well prepared in the event you are targeted.
  • Monitor your statements and be on the lookout for transfers you didn’t authorize or charges to your accounts you do not recognize.
  • Carefully consider who may access your accounts, and keep passwords, PINs, devices and sensitive information safe.
  • Review a financial institution’s products, services and features for ways you can guard against exploitation.

On a day-to-day basis, seniors who are capable should continue to write and sign their own checks, open and send their own mail and email, set up direct deposit for any payments received (like Social Security or annuity payouts), use voicemail to screen phone calls (as a way to avoid unwanted or deceptive solicitors) and do their best to keep track of all of their money and possessions. For couples, it is imperative that both be engaged in their financial planning and decision-making.

A trusted financial advisor, who is committed to serving your best interests, can also help the elderly make decisions and provide guidance for a time later in life when they may not be able to manage your finances alone.

 

Learn more about resources and tips to protect yourself or someone you love against financial exploitation.