News about financial elder abuse becoming more common nowadays. Whether it’s via phone, mail, internet or even direct interaction, vulnerable seniors are being targeted frequently. We often think that such a thing won’t happen with our parents or feel that our parents are smart enough to take care of their money. The disturbing reality is that the thieves are good at it. Studies show that 3% to 5% seniors in the U.S. become the victim of financial abuse every year. No one is immune from the threat. So instead of wishful thinking, we need to build awareness about the threats and focus on helping them protect their retirement savings.
Talk With Your Parents About Their Money
For some of you it may be uncomfortable to talk to your parents about their money. But starting the conversation is the first and most critical step to help safeguard them from financial abuse. Some parents will be relieved you have offered to help but some might be more guarded about the details. At a minimum, you should feel comfortable knowing they have kept good records of all their finances and you know how these records are to be accessed if they are incapacitated. Also, offer to be included in their conversations with professionals like accountants, attorneys and financial advisors who assist them with financial matters. (For related reading, see: Helping Aging Parents Manage Their Money.)
Talk With Your Parents About Potential Financial Trouble
Not every financial crisis elders face is a sign of abuse. But having the transparent conversation can be of real help. Look out for their unpaid bills, creditors’ notices or malicious activities on their bank accounts.
Most scams take place via phone calls. Phone scammers will pose as representatives from a sweepstake, lottery or some other contest and tell your parents they have won a prize. Others will pose as representatives from their bank asking to confirm account information over the phone. Some con artists pose as officials from the Internal Revenue Service (IRS) and threaten legal action over some alleged overdue balances. Remember, the real IRS sends action notices via regular mail only.
Talk with your parents about such scams and make sure they never give out bank account, Social Security, or Medicare information to anyone asking for it over the phone or the internet. Also, ask them to include you when signing any papers, especially contracts, legal documents or anything related to their finances. (For related reading, see: Know the Latest IRS Scams.)
Make Sure Your Parents Are Well-Informed
There are excellent resources to keep you and your loved ones aware of these kinds of frauds. StopFraud.gov offers many resources and tips on identifying and reporting financial abuse of elders. You can also find useful information at AARP.org. They offer programs like Fraud Watch as well as interactive national fraud maps that keep you informed about different reports and alerts from law enforcement agencies.
With wise planning and clear communication, you can make a genuine effort to protect your parents, as well as the other elders in your family, from a costly and upsetting set of unwanted circumstances.
(For more from this author, see: How to Use Your Credit and Debit Card Safely.)