If you are better than 50 years old and your parents are still alive, you have probably wondered from time to time if they might get caught in a scam. It’s a reasonable concern. Seniors are commonly the victims of financial exploitation. One recent study in New York state estimates that as much as $36 billion each year is lost by seniors to financial scams.
The bad guys target seniors for a few reasons.
- They have the money. A 2016 study shows that people better than 50 years of age hold 83 percent of the wealth in America.
- These crimes tend to go unreported. Studies show that as low as one in 44 cases get reported.
- Elderly people are “softer” targets. There is new research that as some people age, they are at increased risk to fall for a financial scam. This can be true even for those who are otherwise very competent and manage their daily affairs without any problems.
How to protect your elderly parents’ money
With all this in mind, it’s a good idea to talk with your folks about the issue. And maybe you want to introduce yourself to your parents’ financial advisors. It’s easy to be added as an “interested party” to receive copies of statements for many financial accounts. This does not give you any rights to remove money or take over the accounts, but it does mean you will get a copy of statements to help monitor things.
In my financial planning practice, most of my clients are older, so I’m always careful to understand any changes to their accounts. I confirm transactions with my client in person or by phone all the time and especially any time money moves in an unexpected way.
And if I suspect a client is slipping when it comes to financial matters, I always suggest a meeting with a trusted child or family friend to help open up a conversation about how to best handle the client’s needs. I’m a fiduciary for all my clients all the time, and I take my responsibility to be proactively working in my clients’ best interest at all times very seriously.
For more information, you may find it helpful to check out this article listing the top 10 financial scams targeted at seniors.
How to report a crime against the elderly
Don’t be afraid or embarrassed to talk with someone you trust. You are not alone, and there are people who can help. Doing nothing will most likely make it worse. You can start with your local police, your bank (if money has been taken from your accounts), and Adult Protective Services. To obtain the contact information for Adult Protective Services in your area, call the Eldercare Locator, a government-sponsored national resource line, at 1-800-677-1116, or visit their website at https://eldercare.acl.gov.
If you are concerned about your parents and their money, you may agree together that you would like some professional advice about how to reach your folks’ goals and keep their money safe. I suggest it could be extremely helpful to talk with a CERTIFIED FINANCIAL PLANNER™ professional.
CFP® professionals are trained in all aspects of financial wellness and receive on-going continuing education each year. Elder finance issues are always high on the agenda. So your CFP® professional will have tons of training and experience.
To find a CFP® professional near you, start your search here.
As you visit with financial planners, I suggest a couple things to check:
- Is the advisor always the client’s advocate – a fiduciary advisor?
- Is the advisor only paid by clients, not any financial product manufacturer or distribution network? That would be a fee-only advisor.
These two points help assure that you are working with a professional who is committed to your best interest at all times. It seems sort of obvious to me that a professional would work in this way, but it’s not automatic.
A fiduciary, fee-only, CFP® professional can help you make great financial planning choices and can develop a comprehensive financial plan for your parents.
Yes, I am a CFP® professional. I’m always a fiduciary and I only work on a fee basis. And yes, I’m still taking on a few great families to be part of my financial planning practice.
If this article has you thinking about your own circumstances, contact my office at firstname.lastname@example.org. I am always happy to meet with people who are working on their retirement plans. Dunncreek Advisors does not provide legal or tax advice, nor is this article intended to do so.