Scams using the stereotype of an elderly, confused person giving their money to a scammer is almost cliché at this point. Unfortunately, not many people question the idea, leading them to question why seniors fall for scams in the first place. A better question might be, why would anyone fall for a scam?
Some experts theorize that perhaps the heightened isolation and loneliness many retirees experience makes them prey to scams. Others theorize that it may be due to some degree of cognitive decline, making older people more likely to believe outlandish claims.
However, you might be surprised that the story “the seniors always get scammed” is actually a myth. In fact, an annual study shows that year after year – young people fall for more scams and pranks than their elders – losing more money to unscrupulous bad guys every year.
Even so, people still target retirees for scams that seek to separate them from their limited funds and income. That is why it is important to protect your assets by avoiding a financial crisis that you will find difficult to deal with later. Here are the top 12 cheat find a way to target people in retirement many years.
1. Pyramid Diagram
One pyramid diagram (or Ponzi scheme) relies on a constant stream of new members whose “investments” are then used to repay previous members. In many cases, no actual product is sold, just the promise of easy money. That’s what makes pyramid plans so appealing to many seniors.
In other pyramid variations, there are products for sale from companies that call themselves multi-level marketing companies. People tell victims that they can make money easily through selling one’s “downline”. The inherent flaw in any pyramid scheme is that it will eventually collapse when not enough new customers arrive to cover the program’s financial obligations to all members.
2. Investment scam
In addition to the traditional pyramid schemes, the types of investment fraud scams exist and are regularly monitored by fraud experts. From relationship scams to pump and dump schemes, there are many ways unscrupulous scammers plan to get your money through investment scams.
Even experienced investors can fall prey to a scam, such as promissory note fraud, where, for example, an investor hands over a sum of money in exchange for a written agreement that means obligations that force the other party to provide a more substantial sum (principal plus interest) on a specified date. That’s perfectly fine if the signers of the promissory note really intend to fulfill their obligations, but in many cases they don’t. You will never see money, or scammers, again. That’s another reason to only deal with reputable, licensed professionals with plenty of solid references.
3. Phishing email
Anyone can fall prey to a phishing email. In this simple but effective scam, someone will send you an official email, asking you to take some action to keep your account in good standing.
The standard version includes an email that appears to be from your bank asking you to verify some personal information — and provides a helpful link to click, which takes you to a website that looks a lot like your bank’s actual website. But, of course, it’s not your bank’s website, so you enter your credentials on the fake website. Now the scammer has full access to your account and can empty it quickly.
4. Home Repair and Renovation Scams
If someone you’ve never met before knocks on your door and offers to repair or perform some improvement task for your home, be extremely cautious. With home improvement and repair scams, the victim is asked to pay an amount of the total fee upfront. Workers leave work unfinished, perform poorly, or complete nothing at all, and the “worker” disappears with your money. Reputable home repair companies often do not solicit business by knocking door-to-door. Always ask for local references and check the company’s online and local presence.
5. Healthcare/insurance scam
Let’s say you receive a phone call or email from someone claiming to be Medicare or an insurance company representative. In that case, it is very easy for that person to obtain your personally identifiable information. With that information, they can steal your identity. Or alternatively, they may offer to mail you free health-related supplies if you hand over your credit card number for shipping and handling fees.
Once you give your information to someone with bad intentions, it is almost impossible to prevent the negative consequences. It’s a lot easier to make a firm rule of never giving out that kind of information over the phone.
6. Grandparent scam
Out of all the scams to hit retired people, the grandparent scam is particularly deplorable. That’s because this scam is based on grandparents’ natural love and care for their family members.
All in all, this scam begins with the target receiving a late-night phone call from a young person posing as a grandchild in trouble. For example, they may claim to have been kidnapped or falsely imprisoned and need their grandparents’ help by transferring large amounts of money (sometimes in cash, sometimes by wire transfer, and sometimes by gift cards). to a stranger at a specific time and place.
Of course, the grandchild is perfectly fine. But late-night calls and high-pressure scenes can make it seem like a real emergency and negate skepticism.
7. IRS Impersonation Scam
Every year, the US Internal Revenue Service publishes “Dirty Dozen” list of top 12 tax related scams targeting taxpayers. One of the most common IRS scams is an identity theft variant in which the caller or emailer identifies himself as an IRS agent and asks that person to “confirm” (i.e. provide) information their personal identification, such as their full name, date of birth, and social security number or taxpayer identification number.
That gives the scammer all they need to steal the victim’s identity and make mass purchases on new credit card accounts that the victim will never even know about. until they run their credit report or get hit by cunning letters from debt collection agencies.
8. Jury duty scam
Calls or emails could indicate that you’re in big trouble ignoring a grand jury summons you never received. Of course, you can avoid prosecution by paying your fine today by credit card or bank transfer. In addition, the caller or sender may pressure you to disclose sensitive personal data through which they can steal your identity. No US court will require you to pay a fine or disclose personal information in this way.
By the way, this scam is already widespread enough that the US federal court system public warning about how it works and how to avoid it.
9. Convenience company scam
A variation of the fake debt collection scam is the past due utility scam, in which you can be targeted by a high-pressure phone call or even a face-to-face meeting from someone posing as an employee. The utility worker threatens to cut off your electricity immediately if you do not pay an amount that is believed to be past due. They can even make it look like the utility company is actually calling you by manipulating your phone’s caller ID function.
The best solution is to end the call or put off the visit and call the utility company’s customer service number yourself to verify what, if any, you may owe them.
10. Fake charities
This scam tries to take advantage of the natural compassion and benevolence of people who want to do something to help. Whether it’s in response to a recent natural disaster or a more local charitable need (like responding to disease or poverty), unfortunately fake charities abound and they are not afraid to pursue retirees and others to contribute. They can request a cash transaction at your front door or a credit card (or bank transfer) transaction over the phone.
11. Sweepstakes and Lottery Scams
If you receive a congratulatory phone call on a recent sweepstakes or lottery win but have no recollection of ever entering such a contest, take it as a big red flag. You may even receive a check in the mail representing your so-called winnings, only to find that your bank refuses to honor the fake check and is required to pay fees or even taxes on it. that loss. Or you may be asked to provide your credit card number to pay some processing fees or prepay taxes.
Legit sweepstakes don’t work this way.
12. Fake health and wellness products
From fake drugs to fake anti-aging skin care products, you can find yourself the target of any health and wellness product scam simply by staying up late watching TV or surfing the web. A common variation or “add-on” to these scams is an oppressive “membership” or scheduled distribution agreement. This is where you can get regular shipments of these fraudulent products while the scammers charge an exorbitant fee to your credit card — plus shipping, of course.
Keep your money safe in retirement
The specifics of any particular scam can vary from case to case. However, there are some salient features of premium targeting scams that you should look out for and be aware of to avoid falling for a scam or scam in the first place. Remember, it’s a lot easier to avoid a scam in the first place than it is to free yourself from its clutches later.
To make sure you avoid becoming a victim of a scam in retirement years and help you protect those valuable funds and other assets, make a habit of being proactively skeptical whenever you are faced with any unusual situation that may involve money or any other asset. any other property or investment.
Question any deal that seems too good to be true. Also, question any requests that seem unusually serious or urgent, like in the grandparent scam. Deal with it now to take whatever time it takes to thoroughly research the cases, including doing a background check if that might help.
Finally, don’t be afraid to run the script by a trusted friend, colleague, or family member. It’s never a problem to get a second, more objective opinion, and it can help keep you from losing valuable assets to scammers.
First published on due date. Read here.
Featured image credit: Photo by Leeloo Thefirst; Bark; Thank you!