Monthly Archives: October 2016

The Ultimate Guide to Preventing Elderly Financial Abuse

The Ultimate Guide to Preventing Elderly Financial Abuse

As of 2014 the entire Baby Boomer generation is over the age of 50. Surpassing this milestone means that people over the age of 50 control 70% of the wealth in the United States.

The increasing age of wealth has also resulted in an increase in elderly financial abuse. A 2011 study conducted by MetLife found that elderly financial abuse costs our elderly loved ones nearly $2.9 billion annually. This calculates out to approximately $30,000 per elder fraud victim.

Since it is National Financial Planning Month, we thought it would be appropriate to discuss elderly financial planning and issues related to elderly finances. In our last blog, we discussed six ways adult children can start the financial planning conversation with their elderly loved ones. This week we want to address the growing trend of elderly financial abuse and exploitation.

Before we start exploring ways to stop elder financial abuse, we should first explain what it entails. Elderly financial abuse spans a broad range of conduct including:

  • Taking money or property
  • Scams that aim to take money
  • Forging senior signatures
  • Forcing an elderly person to sign over deeds, titles, etc.
  • Using elderly property/belongings without permission

While defining elderly financial abuse is easy, the tricky and difficult part is detecting it. Often when an elderly loved one falls victim to financial exploitation they may have no idea, or they may be too ashamed to tell you. Here are some things, as a loved one, you can keep an eye out for:

  • Sudden disappearance of valuable objects
  • Increased withdrawals or check usage
  • A new best friend
  • Signatures on checks that look different
  • A name added to a bank account
  • Fear of caregivers

Now that we know what elderly financial abuse is and what to look for, let’s explore how to prevent it. Fortunately, there are several steps you can take with your elderly loved one to protect them from experiencing financial exploitation.

Cut the Spam
While this might not completely prevent a fraudulent salesman, adding your loved one’s number to the national Do Not Call registry will certainly help lower the amount of sales calls they get.

2 Sets of Eyes is Better Than 1
It is important to have someone trust-worthy, who is close to the senior, appointed as a bank account overseer. They can make sure there isn’t any suspicious activity, and stop it before it gets too far. You can also do this with limited credit cards.

Track Their Credit
Your elderly loved one should order a copy of their credit report at least once a year to make sure there have been no fraudulent accounts opened.

Background Checks
Before hiring anyone to help with your elderly loved one, check their references and credentials.

Visit Frequently
Don’t be a stranger. Not only will your elderly loved one enjoy the company, it is good to check in and make sure everything is the way it should be.

Get a Second Opinion
Before your elderly loved one signs any documents it is important to have them looked over by a financial advisor or an attorney. This will ensure they aren’t getting themselves into something they shouldn’t. Finally, don’t ever rush them into a decision.

Sometimes, despite everything you do, your elderly loved one may fall victim to financial exploitation. If this happens, have your elderly loved one speak with an attorney and police officer. After they file a police report they should also contact Adult Protective Services for additional help and support.

Six Ways to Start the Elderly Financial Planning Conversation

A person’s true colors show when money is involved. Unfortunately, more times than not, those colors are not flattering. Money is quite possibly one of the main reasons people argue, get divorced and ruin relationships.

Due to these reasons, it is no surprise that speaking about personal finances with others is often seen as a taboo subject. When it comes to our elderly loved ones, it is important to have an open and healthy discussion about personal financial planning and saving.

Not only is it critical to have a financial plan for the future, elderly financial exploitation is becoming an increasingly common form of elder abuse, and it is important to protect your elderly loved one from it.

Since October is National Financial Planning month, we thought it would be a fitting time to explore the topics of elderly financial planning and safeguards against financial exploitation.

According to statistics compiled by the National Council on Aging, there are currently more than 25 million Americans over the age of 60 that live at or below the federal poverty level ($29,425 annually per person. On average, elderly receive approximately $433 each month in social security benefits. That’s not a lot.

Even worse, studies have found that “22% of married Social Security recipients and 47% of single recipients aged 65+ depend on Social Security for 90% or more of their income.”

Considering a majority of elderly live on a tight income, it is more important than ever for them to have a solid financial plan to help stretch their budget as far as possible.

We know that starting the conversation regarding financial planning can be tough, but the longer you wait, the tougher it will be. Here are a couple of good ways you can ease your elderly loved one into the conversation:

Tell An Anecdote
Telling an anecdote about another elderly person’s financial issues whether true or fabricated, is a good way to get the conversation going. You could also talk about your personal finances in an effort to break the ice, or bring up “what-if” scenarios.

Enlist the Help of Your Siblings
It is no secret that some siblings have a closer relationship to mom and dad than others. Before starting the conversation with your elderly loved one, build a plan with your siblings. It is usually smart to have the sibling with the closest parental relationship start the conversation then have the other siblings follow in with support.

Beat Around the Bush
Instead of coming out and asking directly about your elderly loved one’s financial plans, ask about what their plans are for the future. When they would like to retire, where would they like to live, do they plan on moving to a retirement community. This will get them thinking about the future and show them that you are interested in helping plan.

The Lending Tree
At first, we recommend you only asking your loved ones if you can lend them a hand with stuff around the house. Maybe there is a chore or errand you could run for them that would help them out. Eventually, you can ask if there’s any other ways you can help such as monetarily. For example, many families share cell phone plans. This not only lowers the cost but also ensures they have a phone for safety.

It’s Awkward but It’s Necessary
We know that it will likely be awkward to talk with your parents about their finances, but this is necessary. It is better to have a plan than be caught off guard in an emergency. The process of financial planning takes a lot of time, and well, planning. Often there are tons of documents that may be kept in secret places. The least amount of surprises, the better.

Don’t Know Where to Start?
If you are still feeling uncomfortable with having the talk, enlisting a professional to help can be the best route. Feel free to contact us, and we can help you find an elderly financial planning professional in your area.