Helping Your Aging Parents With Money is a new series highlighting financial topics you may need to discuss with an aging parent or relative. It was inspired by recent events in our own lives and Cameron Huddleston’s new book, MOM and DAD, We Need to Talk. (We are big fans of Cameron’s book; you can read our review here.)
If you’ve always discussed important issues openly with your parents, bringing up financial topics probably won’t come as a surprise. But if money talk has been taboo through the years, you’ll need to tread lightly. There are a lot of emotions around money, and aging parents may be very concerned about sharing details of their financial lives.
In this series, we’ll talk about money conversations we’ve had with our parents and close relatives. Feel free to add to the discussion by adding comments or asking questions.
It’s no surprise that there are plenty of scams trying to separate you from your money. But senior citizens are the group most often targets for serious financial exploitation. In 2018, the Senate Special Committee on Aging reported that older Americans lost almost $3 billion to scams.
Let that number sink in.
At a time in their lives when they may be on a fixed income, can’t make much money (if any), and probably need more money for health and long-term care, they’re becoming victims of fraud at an alarming rate. While some lose small amounts of money, others lose their life savings.
Some of the biggest fraudulent schemes people fall for include:
- Social Security and IRS Impersonators
- Charity or Donation Scams
- Fake Family Emergencies (Grandparent Scam)
- Computer Tech Support Scams
- Sweepstakes or Prize Scams
- Romance Scams
- Wellness Product/Service Fraud
- Reverse Mortgage Product Scams
- Home Improvement/Repair Scams
If you think that you would never fall for their scams, think again. I’ve almost fallen for some of the scams above, and I am very aware they exist!
But my parents are in their 80’s and they are definitely potential victims of many different types of financial scams.
Keep reading to learn more about them and what you can do to help protect your loved ones.
Going After the Most Vulnerable
Why do fraudsters target seniors? Simple. It’s assumed they are trusting, respect authority, have large sums of money (or need a lot of money), and may not realize all the different types of scams that exist – especially technology-related fraud.
And the majority of older adults who are scammed don’t report they’ve been victimized because they:
- Don’t realize they were taken advantage of
- Aare embarrassed that they fell for a scam
- Fear loved ones will question their ability to manage their finances
The tactics scammers use become more sophisticated every day. If you click on the wrong link in an email or get caught up with concern on a scam bank call, you can let thieves have access to your money.
Once they have your money, the chance of getting it back is slim – unless the mistake is caught immediately. Scammers will also try to repeat their tricks again to get more money. They can profit by selling the names and information of those they’ve stolen from too.
That’s why it’s so important for you to talk to your aging parents (relatives or close friends) about how they can avoid financial scams.
Information and Resources on Common Financial Scams
With data breaches and people sharing freely on social media, it’s safe to assume a lot of your private information is available to people who want to steal from you.
If you don’t believe it’s that easy to get information about you, just google yourself and review your social media accounts to see what you can find in only a few clicks.
Here’s some information about common financial scams and resources to help you (and your aging parents or loved ones) avoid them.
Social Security and IRS Impersonators
According to the Federal Trade Commission (FTC), “claiming to be a government authority is a tried and true way scammers trick people into sending money.” While IRS impersonators have scammed people for years, Social Security Administration impostors are using robocalls frequently now to scam older people.
You may even get a call that looks official because the phone number is “spoofed” and comes up as a government agency.
Most of the scams claim you’ve done something illegal and may be subject to fines or jail time. Others claim benefits will stop unless you send money – usually in some unusual way including gift cards, bitcoin, or wiring money.
The FTC website advises people to never give out personal information or Social Security numbers on the phone and not to trust caller ID. They also suggest you tell others about scams and to call the real SSA if you have any questions at 1-800-772-1213.
Charity or Donation Scams
Giving money to causes you believe in is one way to help those in need. While there are important charities at the local, state, national, and global levels – you’ll find fraudulent charities or donation scams in each place too.
According to AARP, “sham charities succeed by mimicking the real thing.”
Since the holiday season is a key time for charity and donation scams, make sure you talk to your aging parents about avoiding any charity that is pressuring them to donate.
To check on the legitimacy of a charity, you can use the IRS’s tax-exempt organization search. Another option is to check websites such as the non-profit organizations CharityWatch or Charity Navigator.
Fake Family Emergencies (Grandparent Scam)
A popular scam is for an aging relative to receive a call about one of their grandchildren being in some kind of trouble. Often the scammer pretends to be the grandchild who urgently needs money, and asks the grandparent not to tell anyone.
Even grandparents who know about scams can send money to fraudsters when they think their family is in need. Tell your parents to contact the parent of the grandchild to check on their welfare or to contact the grandchild directly before they ever send “emergency” money.
Computer Tech Support Scams
An older adult may get a phone call or pop-up on their computer, claiming to be from tech support at a reputable company, stating they have found malware on their computer.
These scams exist to get the target of the scam to pay for services they don’t need or to share personal information. Scammers can also try to load malware on their victim’s computers.
Older adults may be wary of trying to deal with problems related to their computers on their own. They may need your assistance in running free virus and malware removal tools to keep them active and using their computers.
Sweepstakes or Prize Scams
When you think you’ve won a large sum of money or an amazing prize, you can quickly forget that these can often be a scam. Older adults may also be more trusting of “official” results than they should be.
Remind them that paying a sum of money or giving credit card or bank information to get a prize is a reason to be suspicious of the contest. If they “win” a prize in a contest they didn’t enter, they’re likely getting set up to lose a lot of money.
When you’re in love, you can do some crazy things. But when you fall in love with someone online, there should be “warning bells” when your significant starts asking for or needing money – right?
While many relationships today start online, it’s also opened up a way for people to be victims of financial abuse. If your aging parent is in an online relationship, make sure they know about “Sweetheart Scams” and the potential for being victimized.
They may not appreciate you getting involved in their love life. But they’ll thank you if their new love starts asking for or needing money before they’ve even met.
Wellness Product/Service Fraud
As we get older, we may look for different anti-aging products or services to help us feel or look younger. We also may face serious illnesses and look for ways to get well again.
Scammers look at seniors as easy prey who’ll part with their money to improve their wellness.
With new real cures given many people hope for a long and healthy life, con artists’ claim their products can do what these cures can. Seniors often fall for these sketchy products or counterfeit drugs promising increased cognitive function, strength, energy, anti-cancer properties, etc.
Ask your parents to speak with their doctor or you prior to pursuing any health or wellness product.
Reverse Mortgage Product Scams
A reverse mortgage is designed to help eligible homeowners access the equity in their homes without having to make monthly payments. They’re often pitched to older adults as a way to get money without having to sell their home or take on another debt.
But seniors can be taken advantage of when the companies offering the mortgages end up making big profits. This FBI page discusses what you should do to avoid reverse mortgage scams and how to report them if you or a loved one are victims.
Home Improvement/Repair Scams
Older adults can be targets of home improvement, maintenance, and repair scams and lose thousands of dollars. Criminals who seem to be legitimate and experienced contractors or business people, may give estimates for work, get signed contracts, and ask for partial payments for work to be completed.
Seniors who need work to be done on their homes often trust them and feel the need to pay ahead so that the contractor will come and do the job promptly. Older adults may also pay much higher costs to get work done. Or contractors may take their money and never show up to do the job.
Warning Signs Your Loved One Is Being Scammed
Some people who are victims of fraud will be quick to realize it and will try to get help to prevent losing their money. But others may suffer embarrassment or not even realize they’re victims of fraud.
If you talk to them about money and they are involved in a scam, they might seem anxious, nervous, or confused. You may realize bills aren’t paid. Or you start to see late notices or fees. If they have piles of junk mail from “charities” seeking donations or get frequent calls asking for money, they may need your help.
Your loved one might start talking about a new friend they’ve met online. If you begin asking questions about their finances and falling for scams, they may be defensive and tell you not to worry. While you want to “tread lightly” – don’t ignore warning signs about romance scams.
Talking To Your Aging Parent About Scams
While many of the examples above discuss how others might financially scam your aging parent, sometimes family and friends are the ones committing fraud. Your parents need to know who they can trust and what to do if they feel they are being financially abused.
When you talk to your parents, focus on educating them and giving them the tools they need to stay safe. The idea of being scammed and losing money is scary for anyone – but especially for older adults.
If they get calls they are concerned about, tell them to hang up. They can call you or a government or financial institution if they are worried or confused.
Legitimate callers don’t ask for personal information (such as their Social Security number, PIN, or username) over the phone and anyone demanding payment them in gift cards or other odd methods of payment are just trying to steal their money.
Aging adults should know what phishing emails look like and they should also avoid oversharing on social media.
If you have concerns about your parents financial wellbeing and them being exploited by a scammer, contact Adult Protective Services in your state.