Protect Your Nest Egg: 4 Financial Scams to Watch Out For

According to a recent MetLife survey, $2.6 billion is lost each year to financial scams aimed at seniors and retirees.¹

Being aware of the common financial scams is a good first step in protecting your nest egg, but hiring a financial advisor as your sounding board could be your best defense. Your advisor may have seen the scam before and can help prevent it from happening to you.

4 Common Financial Scams to Look Out For and How to Protect Yourself

1) “Reduce the Interest Rate on Your Credit Card”

If an unsolicited caller says they can reduce your credit card rate and asks for your existing credit card number and personal information, hang up.² You can always call your credit card company directly if you want to negotiate rates. It is important not to give your social security number or credit card number to anyone but the most trusted companies you have a working relationship with.

2) You See an Unknown Pop-Up on Your Computer

Be skeptical of any pop-up window from an unknown source that appears on your computer, especially those asking you to provide any personal, confidential information. By clicking on the pop-up, you may unknowingly allow the installation of malicious software on your computer that can monitor your online activities or access personal information.³

3) Unsolicited Calls from Telemarketers

The AARP estimates that about 80 percent of those who are victimized by devious telemarketers are 50 or older. If it’s a product you may be interested in, ask to take down the caller’s information and then do some research on the product or company before making a purchase.⁴

4) A Grandchild in Need of Emergency Funds

Fraudsters can go so far as to learn about your family, then claim to be a grandchild in need of money in a crisis. Often times, they will plead to wire them money but “not tell their parents.” AARP Washington state director says these types of scams are happening all over the country.¹ If you are unsure if it is your real grandchild or not, take time to check with your family or simply hang up and attempt to call your grandchild back.

Why Are Older People Being Targeted More than the General Population?

A recent study by the AARP highlighted some of the reasons why people over 50 are more likely to be victims of fraud. People over 50 are generally:

• More likely to expect honesty in the market place

• Less likely to take action when defrauded

• Less knowledgeable about their rights in an increasingly complex market place

• More likely to be home where they’re accessible to telemarketing scammers⁴

Additional Resources for Avoiding Financial Scams or Reporting Them

• The AARP recently launched www.aarp.org/fraudwatchnetwork which alerts people to new scams. You can sign up to receive alerts.
• The Senate Aging Committee has a fraud hotline making them easier to report financial fraud: 855-303-9470.
• You can report suspicious activity to the FBI’s Internet Crime Complaint Center: www.IC3.gov.¹

Report Suspicious Activity to Your Financial Advisor Before Giving Away Information

Having a second set of eyes monitoring your financial situation is important, and a trusted financial advisor should play that role for you. Do not hesitate to ask for advice. It could mean protecting a piece of your nest egg.

If you do not have a financial advisor or want to run something by one of our Certified Financial Planners, give us a call at 1-800-541-7774 so we can answer your questions.

By Valerie De Vol, IACCP^®

Valerie is the Chief Compliance Officer and Chief Operating Officer at WrapManager, Inc.

Sources:

1 USA Today

2 Scam-Detector.com

3 Royal Bank of Canada

4 Nolo