You work hard most of your adult life and play by the rules in order to have your pick of retirement living options and be comfortable in this stage of life. As you know, it's important to have savings for retirement, but unfortunately scammers recognize this fact as well and target older individuals with financial scams.
According to the Federal Bureau of Investigation, seniors are more likely to have a nest egg saved up, to have good credit and to own their homes, which makes them attractive targets for scams. People who were raised between the 1930s and 1950s were taught the values of being polite and trusting people, which are traits that may be easily exploited. Additionally, adults in this population may be less likely to report a fraud because they're unsure of who to report it to and cognitive impairment or memory issues could make it more complicated to give an accurate statement of the crime.
The good news is that being aware of the various scams will help you protect yourself from becoming a victim, and you can share this information with friends as well so they can keep their finances safe.
Let's take a look at some of the most common finance scams aimed at seniors, so you can better understand how to avoid becoming a target:
Cemetery and funeral scams
There are two common types of scams that fall into this category. In the first, scammers read obituaries, then attend the funeral service in order to take advantage of the widow or widower is his or her grieving state. The scammer might claim that the deceased had an outstanding debt in order to extort money. The second includes dishonest funeral home employees capitalizing and a family's unfamiliarity with the cost of services and adding extra, unnecessary costs to the total.
Health insurance/Medicare scams
All adults in the U.S. are eligible for Medicare once they reach the age of 65, so a scammer might call a senior posing as a Medicare representative and ask for updates on the older adult's personal information. The scammer might also provide false services at a fake mobile clinic, according the NCOA, and use the senior's information to bill Medicare and take the money. A real health insurance provider or Medicare rep would never call or come to your door asking for this information, so receiving a call or a visit such as this is most likely a scam.
The National Council on Aging listed the grandparent scam as one of the top 10 most common because it's simple and pulls on the heartstrings of seniors. Scammers will call a senior, and when he or she answers the phone, the scammer will say something to the effect of, "Hi Grandma, it's been too long since we've spoken," or "Hey Grandpa! Do you know who this is?" When the senior answers with a name, the scammer says yes and then often ask for money for a sudden financial problem to be paid through a money transfer that doesn't require identification. The scammer will also most likely ask the senior not to tell his or her parents.
Prescription drug scams
It's not unusual for seniors to take multiple medications and some of them can be quite costly. In these scams, older adults might be sent an email about major discounts on prescription drugs; however, once he or she inputs their credit card information, their money is stolen.
How to protect yourself
Knowing that scams like these exist is the first step to staying protected against them. But it's also imperative to understand how to not become a victim. These tips can help:
- Ask questions and get information before giving out any personal information.
- Be suspicious if something doesn't feel right. Being skeptical of a situation that feels odd is OK.
- Don't make impulsive decisions if a telemarketer calls. Always take time to research instead of making a rash choice.
- Never give out personal information online, whether it's your Social Security, bank routing or credit card numbers.
- Learn about online safety including email spam settings and only using reputable websites.