The baby boomer generation continues to have a large affect on business in America. That is still true now that many are retiring. With the number of retirees increasing dramatically, more scammers have moved to targeting the older population. With that in mind, here is a list of some of the top scams one needs to look out for, and what can be done to guard against them.
Grandchild Scam – The scammer will call you grandma or grandpa and ask if you know who this is. When you guess a name, they will pretend to be that person and proceed to tell you that they have had some major financial issue that needs your help right away. They will ask you to wire the money or send a check. They will also indicate for you not to say anything to their parents, because they don’t want to get in trouble. They will probably keep asking for money until you are bankrupt or get wise to them.
How to protect yourself – Don’t be so quick to give out any personal information. You would always want to check with your kids or grandkids directly, through the phone numbers you have in your address book.
Lottery Scam– With this scam, the caller says you have won a lottery or prize, but you need to pay a tax or fee ahead of time in order to release it. Often the scammer will send out a check for you to deposit. By the time it takes for the fake check to bounce, the scammer has cashed your check for the “tax” and you are left with only a bounced check fee.
How to protect yourself – if it sounds too good to be true, it is. A lottery or prize would not have you pay the tax on the winnings first. This would be paid through your end of year taxes the year after you receive the money.
Tax Scam– Scammers send out “official” looking letters pretending to be from the county tax collector with information gotten from public records, the APN number and assessed value of the property. They offer to lower the assessed value and therefore the property tax rate, for a fee.
How to protect yourself – Always look up the phone number for any government agency independently of the paperwork mailed to you and ask them to confirm the letter.
Private Reverse Mortgage Scam – Legitimate HECM reverse mortgages have grown by 1300% from 1998 to 2008, but with the legitimate reverse mortgages come copy-cat scams. Unsecured reverse mortgages can cause homeowners to lose their home when the scammers offer money or a free house somewhere else in exchange for title to the property.
How to protect yourself – stay with government insured Home Equity Conversion Mortgages (HECM) or reverse mortgages. All of the guidelines and protections are set by the Department of Housing and Urban Development. This is the safest loan program one can have as you cannot lose your home due to non-payment of the mortgage, because there is no mortgage payment.
Repair Scam – You bring a vehicle in to fix your squeaking brakes and the repair shop informs you that you have a long list of items that are “necessary” to be fixed. This is also very common with certain oil change franchises.
How to protect yourself – it is generally a good idea to get 3 or more quotes before having any work done. First of all, you can see what work was recommended to be done by each repair shop, and of course you can compare pricing. You may also consider having a trusted friend help you in this process.
Pyramid or investment Schemes – Retirees typically have large amounts of cash on hand for their retirement years. Schemers know this and will entice you with promises of high returns on your investment with them. You may get a return on the first, smaller, investments to make you feel safe investing a larger amount. Once the large check from you has been received, you will never get that money back. Bernie Madoff tricked many wealthy people out of their money with promises of an 8% return on their money.
How to protect yourself – At this stage in your investment life, you probably want to stay with safe, secure investments that offer guaranteed rates of return. Consult with multiple family, trusted friends, and advisors before making any financial decisions.
Internet Scams – The internet is a great source of information and an easy way to get scammed. Fake anti virus software, links, or downloads from unknown sources is an easy way for a scammer to gain access to all of your personal information stored in your computer.
How to protect yourself – Always keep your anti virus software current. It might be a good idea to pick up the phone and call your bank or credit card company directly, rather than respond to an email claiming to be them. Don’t download anything without independently verifying it was actually sent from the sender.
Telemarketing – Seniors make twice as many purchases over the phone as other demographics and therefore are targets for scammers with fake products to sell. There are also many telemarketers that pretend to represent a charity and get substantial donations over and over again from unsuspecting targets.
How to protect yourself –If you want to donate to the red cross after a disaster, look up their phone on your own to make sure your money actually goes to those in need. Always independently verify the company and phone numbers of those you are doing business with.
Funeral Scams – Scammers will read obituaries and attend funerals of those that have passed away and approach family members with a “fake” debt owed them and attempt to settle that debt with the family members.
How to protect yourself – Consult with a lawyer, or check title records before discussing paying back a debt you are unfamiliar with.
Fake Medicare enrollment – Scammers will pose as medicare representatives offering to help enroll them in this government product only to use the information to steal their identity. They may also collect fake enrollment fees and pocket the money.
How to protect yourself – Before giving out any of your personal information, you should independently verify the company or person you are dealing with is actually associated with Medicare or whichever company they espouse to represent.
Scammers prey on your trusting nature to steal from you. Always verify the person, company, and phone number on your own. It is always a good idea to check with trusted friends or family before you send out any checks or wire funds to any new parties. You need to trust your instinct and if it sounds too good to be true, it usually is.
To obtain the contact information for Adult Protective Services in your area, call the Eldercare Locator, a government sponsored national resource line, at: 1-800-677-1116, or visit their website at: www.eldercare.gov.
*resources for this article can be found at the following links: http://www.hecmworld.com/reverse-mortgage-news/scam-alert-keeping-seniors-safe-consumers?utm_source=Blog+Post+July+7%2C+2015&utm_campaign=July+7th+2015+Blog+Post&utm_medium=email