Elderly Scams Prevention: How to Keep Your Savings Safe

With the variety of ways we communicate today, fraud is a bigger threat to our financial safety than ever. It can strike anyone at any time if they’re not careful, though it poses an even greater risk to older adults. As we age, it can be more difficult to spot an imposter, which is why scammers are more likely to target seniors than any other age group. The only way to keep yourself and your loved ones protected against elder fraud is to stay informed.

What is Elder Fraud?

Elder fraud is a common problem faced by older adults all across the country. It involves a scammer posing as a legitimate business person or another official who tries to exploit their target financially. Such scams can happen to anybody, but older adults are the most common targets.

The most important feature of elder fraud is that it can take many forms. That means the best way to protect yourself or your loved ones against elder fraud is to stay informed on all of the most common elderly scams.

Common Scams to Stay Aware of

You might be surprised at just how many shapes and sizes elder scams can be found in. Take some time to familiarize yourself with these common scams so you can stay alert.

The Grandchild Scam

One of the most common ways elder fraud is experienced is by phone. There is no end to the variety of different scenarios you might encounter, but one of the most common is called the grandchild scam. In this case, the scammer calls the number of their target, pretending to be their grandchild. They claim that they are in trouble, often in jail in an unfamiliar place while on spring break. By the end of their story, they’ll ask their target to send them money as soon as possible.

It’s more effective than you might think, as the scammer is often equipped with the name of the grandchild. Luckily, it can be avoided entirely by checking up on their story. Simply call your family to see whether or not it's true. Most of all, remember never to give financial information over the phone.

The Sweepstakes Scam

This one’s a little bit more straightforward, where the scammer contacts their victim, telling them that they have won sweepstakes and are entitled to claim their prize money. But to collect their winnings, they need to forward a sum of money to cover bank fees, insurance, or taxes. This can happen by phone but is also commonly seen via text or email.

Just like with the example above, this scam is best avoided by keeping your information to yourself. Don’t send money or financial information to people you don’t know.

The Sweetheart Scam

Older women or men can fall victim to this scam, though it looks a bit different than the two described above. It can happen over the phone or via email, though in many cases, it happens face to face. A con artist convinces their victim that they have romantic feelings for them. Then, over weeks or months, they find ways to get money from them. In the end, they disappear once the victim’s savings have been depleted.

What makes this scam so tricky is that it’s not always easy to tell whether a person’s feelings are genuine. Ultimately, the best way to protect yourself is to use common sense. Be realistic about the nature of the relationship, and take advice from family and friends. If you don’t know the person well, it’s probably not a good idea to be transferring money to them regularly.

The Contractor Scam

Scammers are aware that many older men and women need home improvement services. The con is simple: they take money before the project is completed and then ditch their victim as soon as possible. It’s a scam that anybody can fall victim to, but older adults are especially vulnerable, as they are less able to do home repairs themselves.

To stay protected, make sure to do your research before hiring a contractor. Never make a payment upfront, especially with someone you haven’t worked with before.

The Charity Scam

This scam can also be hard to detect because it relies on real-world disasters and tragedies to sell its credibility. Scammers posing as relief organizations may call, text, or email asking for charity money that they claim will be used for a good cause. In many cases, the money is transferred without the victim ever learning the truth. 

If you do want to give to charity, the best way to do so is to reach out to the organization directly. Visit their website, and learn more about safe giving.

Red Flags to Watch for

Staying aware of the most common scams is only part of the equation when it comes to avoiding elder fraud. To stay in control of your finances, make sure to be on the lookout for all of the common red flags.

If you think you’ve been the victim of a scam:

• Make sure to pay close attention to your bank account
• If you see any strange activity like transfers, unfamiliar signatures on checks, or large withdrawals, make sure to look into it. 
• If you’re having trouble managing your finances, it could be a good idea to open a joint checking account with a family member.

This also applies to wills, insurance, trusts, or power of attorney. If you notice any surprising changes, make sure to look into them.

The most vulnerable seniors are the ones with the weakest support systems. Take a look at our guide on Elderly Loneliness to learn more about keeping an active social life into old age.

How to Help Seniors Prevent Elder Fraud

In many cases, the responsibility of protecting against fraud falls on the soldiers of a senior’s loved ones. It can be a sensitive topic that should be approached carefully, though when done right, there are plenty of ways to keep your parent’s assets protected.

Start the Conversation

Talking about finances can be difficult for some people, which is why special care should be taken when starting the conversation. Rather than demanding access to your parent’s accounts, insurance, and power of attorney, start by gauging what level of involvement feels comfortable to them. Even if they’re initially resistant, gradually easing into the conversation can be a good way to gain their trust.

Seek Transparency

The best way to stay on top of your loved one’s finances is to be as transparent as possible. Do you know the names of the financial professionals they work with? What about their accountant, lawyer, broker, and financial planner?  By familiarizing yourself with this kind of information, it will be easier to spot fraud when it strikes.

Stay Aware of Your Parent’s Capabilities

If you have at least some transparency with your parent’s finances, it should be easier to have a better grasp of their financial management abilities. While there isn’t always an easy way to tell whether your elderly parent can manage their finances, there are a few warning signs to keep an eye out for. If they’re frequently bouncing checks, forgetting to pay bills, or spending erratically, it may be time to have a conversation about taking a more active role.

Simplify

Another solution for a parent that has a hard time managing their finances is to make their finances easier to manage. Rather than holding half a dozen different credit cards, try sticking with just one or two alongside a regular debit card. Automatic bill payment can be another useful way to ease the burden on them. When you cut down the total number of regular tasks they are responsible for, you’ll likely find them more capable of handling the situation themselves.

Stay Informed

One of the most important things to understand about elder fraud is that it’s constantly evolving alongside technology. While the scams listed above will probably not go away anytime soon, scammers are always looking for newer and better ways to separate people from their money. If you’re responsible for the financial safety of a loved one, make sure to stay informed on all the biggest threats today. The Federal Trade Commission is a good place to start for up-to-date research.

Keep Your Parent Connected

While watching over your parent’s finances can be a good way to protect them from scams, no caregiver can be expected to make it their full-time job. That’s why it’s important to give seniors plenty of social outlets. This can mean family email groups, senior center events, or friendships with people who live near them. When they’re surrounded by people they can trust, they’ll have an easier time gaining perspective on potential scams.

A rewarding occupation can be one way to stay connected. Check out these top jobs for seniors.

Schedule Regular Meetings

Even after you’re in communication with your parent about their finances, raising the topic regularly can be difficult. That’s why it’s important to schedule regular meetings ahead of time. Monthly financial meetings can help keep you appraised of the big picture of your parent's finances and get an up-to-date idea of how good of a grasp they have on regular financial talks. When it comes time to transfer bank accounts into your name or other difficult steps, a regular meeting can make it even easier.

What to do if a Senior is Scammed

If you discover that you’ve been scammed, it’s important to think carefully and take the appropriate steps to protect your accounts. With fast and well-considered action, you may be able to mitigate some of the damage caused by scammers.

Gather Information

As soon as you discover you’ve been scammed, it’s important to immediately cut off communication with the scammer. Begin gathering as much information as possible so the authorities will have more to work from once you report the incident. Make a record that includes all of the following information:

• A detailed description of the scam
• The date and time of any incidents
• The location of the incident
• The name of the scammer or anyone else involved.

You can also collect emails, texts, and voice messages to have ready. This may be able to serve as evidence in a conviction.

Report the Incident

After you’ve collected all of the necessary information, it’s time to report the scammer to the proper authority. Each case will be slightly different, and who you report the incident to depends on the specifics of your case. Consider getting in touch with one or more of these agencies:

• Government agencies like the Federal Trade Commission. These agencies do their best to keep track of all kinds of fraud and support people in seeking justice.
• Your bank or other financial institutions. This can be particularly helpful if the scammer got ahold of your credit card information and has made purchases. In some cases, you may be able to cancel or reverse the activity if you act fast enough.
• Local police can be a good contact, especially if you met the scammer in person or they target local residents.
• Credit bureaus like Equifax, TransUnion, or Experian can help cut down on the damage caused to your credit and other personal information.
• Friends and family are, of course, good to reach out to just to offer emotional support and brainstorm ideas for finding solutions.

Manage Your Mental Health

Last, but not least, seniors and those close to them should make an effort to manage the victim’s mental health after a scam has taken place. It’s easy to feel vulnerable or even ashamed after falling victim to a scam, and it can take time before they feel secure again. In the meantime, finding support from friends and family is key to processing negative emotions, managing stress, and staying mentally healthy.

Staying Alert to Fraud Each Day

Each day, scammers find new and surprising ways to take advantage of other people. However, while older adults are more vulnerable to fraud, that doesn’t mean that there isn’t anything they can do to stop it. By staying informed, taking the proper precautions, and having a robust support network, they can stay alert and protect their finances as well as anyone else.