Financial scams are rising, and older adults are among the most targeted victims. These individuals typically hold considerable wealth, and as scams have become more sophisticated, fraudsters are becoming more targeted in their approach. The FBI’s Internet Crime Complaint Center reported that scams targeting individuals age 60 and older caused over $3.4 billion in losses in 2023. Sadly, many of these crimes go unreported.
Scammers prey on trust, emotions, and unfamiliarity with technology to exploit their victims. The best way to avoid schemes and protect your wealth is to be aware of common tactics and stay vigilant.
Six Common Scams Targeting Older Adults
Scammers are continually inventing new ways to steal your money and information, though there are a few common approaches you can watch out for.
Email Phishing
These scams use deceptive emails to trick recipients into sharing sensitive information like their Social Security number or bank account details. Be sure to scrutinize any email that claims to be from a bank or financial institution that has suspicious-looking links or requests sensitive data.
Investment Fraud
Investment scams such as Ponzi schemes, fraudulent real estate deals, or unregulated securities offerings can appear quite legitimate when they’re really designed to steal wealth. Be wary of any deal that promises high returns with minimal risk.
Grandparent Scams
Scammers will impersonate grandchildren or other close relatives (thanks to advancing technology and AI, it sounds real!) and often present an urgent or emotionally charged situation designed to provoke fear or concern. These scenarios are meant to prompt the victim to act quickly without verifying the authenticity of the request.
Imposter Scams
Imposter scammers pretend to be someone you would typically trust, such as a government official or a company representative. They try to manipulate you into giving them money or personal information.
Tech Support Scams
These scams involve fake popup alerts or unsolicited calls claiming your computer has a virus. Scammers might request remote access to your device or demand money to fix nonexistent issues. Sometimes, they install ransomware that prevents you from accessing your device and requires payment to unlock access to your files.
Charity Scams
If a charity calls to ask for a donation or remind you of a pledge you don’t remember making, it could be a scam. A charity scam is when a thief pretends to be a member of a real charity or creates a fake one to get money. Be especially mindful of these scams during the holiday season or after a natural disaster like a storm or wildfire.
Takeaway: If you receive a phone call and start to wonder if what you’re hearing is legitimate, just hang up. The most important thing you can do is find another way to verify the situation or claim before giving out any information.
Four Red Flags of a Scam
Scams can be difficult to detect, but most fraudsters deploy one or more of the following tactics to get what they want.
Unsolicited Communication
Scams often start with unsolicited contact—unexpected calls, emails, or messages from unknown sources. So be suspicious of any uninvited communication, whether it’s a supposed government agency, a distant relative, or a company claiming to offer technical support.
Urgency or Pressure Tactics
Scammers manipulate victims into making quick, uninformed decisions by creating a sense of urgency. Common phrases include “act now,” “limited time offer,” or “your account will be suspended.” This pressure is designed to bypass logical thinking and force impulsive actions.
Requests for Sensitive Information
Legitimate organizations rarely ask for sensitive information via phone or email. Requests for details such as Social Security numbers, account information, or passwords, especially without prior interaction, should raise a flag.
Unusual Payment Methods
A common scam tactic involves demanding payment through unconventional means such as gift cards, wire transfers, gold bars, or cryptocurrency. These methods make it difficult to trace or recover funds once they are sent.
Takeaway: If you think a scammer is contacting you, stay calm. Don’t let urgency or fear cloud your judgment. Always confirm the identity of the person contacting you and challenge them with specific questions that a real representative or loved one would be able to answer. If they hesitate, hang up.
Best Practices for Protecting Your Finances
If you’re familiar with the most common types of scams and specific behaviors that raise suspicion, these guidelines can help you proactively guard against fraud.
Implement Strong Financial Safeguards
Start by regularly monitoring your bank, investment, and credit accounts for unauthorized activity. Use features like multi-factor authentication to add an extra layer of security. Avoid using the same passwords across multiple accounts and consider using a reputable password manager.
Educate Yourself and Your Family
Staying informed is one of the best defenses against scams. In addition to familiarizing yourself with fraud tactics, encourage family members (particularly caregivers or those managing joint accounts) to do the same. Open communication within the family ensures that everyone is vigilant.
Vet Professionals and Offers
Verify their credentials through a trusted source before engaging with a new investment opportunity, contractor, or charity. Investment professionals should check regulatory bodies like FINRA or the SEC. For charities, use a platform like Charity Navigator to confirm legitimacy before donating.
The team at Rodgers serves as another strong line of defense against fraud. We provide another set of eyes on your account activity, vet investment opportunities, and help you make informed decisions. You can always ask your adviser for a second opinion when in doubt.
Want to learn more? Here are a few additional resources:
- AARP Fraud Watch Network: offers updates on the latest scams and tips for prevention.
- FTC Consumer Information: a hub for reporting scams and learning about fraud protection.
- Identity Theft Resource Center: helps victims of identity theft regain control.
Insights:
- Protecting your wealth requires awareness, proactive measures, and trusted partnerships.
- Trust your instincts, take your time before acting, and remember it’s always okay to say no or hang up.
