Your golden years are supposed to be the time when you live off your retirement savings, see more of your family and dive fully into leisurely pursuits. Unfortunately, they're also the years when you'll be a prime target of financial scams.
Seniors tend to have savings, steady income from Social Security, money in retirement accounts and other assets, like a home that they own. As they age, the elderly can also become more vulnerable to being fleeced, especially if they live alone, are struggling with illness or begin to show signs of cognitive decline.
"It's why bank robbers go to the bank," said Amy Nofziger, director of regional operations with the AARP Foundation. "Scammers and criminals will go to older adults because that's where the money is, so they're certainly targeted more often than not."
The illegal or improper use of a senior's funds, property or assets is the most common form of elder abuse in the U.S., according to the Consumer Financial Protection Bureau. Annual financial fraud losses for older Americans can reach as high as $36.5 billion, according to a 2015 study cited by the CFPB.
Only a small portion of incidents are reported. One study out of New York State shows that for every case of financial exploitation that gets reported to law enforcement, adult protective services or a similar agency, 43 cases go unreported, said Naomi Karp, senior policy analyst at the CFPB's Office of Older Americans.
And the threat isn't just from anonymous online scammers reaching out over a chat box on your computer and offering to vanquish a computer virus, or others posing as IRS agents to demand you pay Uncle Sam taxes with an iTunes gift card. They can be family members and others you know who have easy access to your checkbook or Social Security number.
"Of the crimes that are perpetrated, unfortunately, a lot of them are those known, interested people who have a lot of access," Karp said. "There are just so many ways to get at the money."
Here are some steps seniors should consider to protect themselves from financial fraud:
SAFEGUARD IMPORTANT DOCUMENTS
Keep your ID, checkbook, bank statements, utility bills and other documents with details that could be mined to open unauthorized credit in your name locked or out of view from relatives and caregivers.
Some studies suggest that fraud and theft perpetrated by family members and others known to the victim makes up the majority of the cases of elderly financial fraud, Karp said.
MONITOR YOUR ACCOUNTS
Keeping tabs on your bank and credit cards is key to spotting unauthorized cash withdrawals or charges. Do this by regularly going over your monthly statements.
You can also enlist a trusted family member to do it. Or have them use an app like Mint, which allows users to view bank and card transactions, but not make any withdrawals or charges.
Also check your credit report regularly. You're entitled to a free report annually. Get it here: https://www.annualcreditreport.com/index.action
FREEZE YOUR CREDIT REPORT
Consider freezing your credit report, which guards against having unauthorized accounts opened.
Contact the three major credit reporting agencies — Equifax, TransUnion and Experian — and ask them to freeze your credit report. Each agency will charge between $5 and $10.
This doesn't prevent you from using the credit cards you already have, though you'll have to ask to pause the freeze if you want to sign up for a new credit account.
Note that the freeze won't stop unauthorized charges on your existing cards.
Among fraud complaints called into the Federal Trade Commission's Consumer Sentinel Network (CSN) last year, some 77 percent of them listed the phone as the way that scammers made contact. By comparison, email was cited in 8 percent of complaints, websites in 8 percent, and mail in just 3 percent. Other methods accounted for 6 percent.
The takeaway here? You may reduce the chances of being the victim of financial fraud by screening your calls.
"Stop picking up your phone," said Nofziger. By not answering the phone, you deny a potential scammer "an opportunity to convince you about whatever they're pitching."
Never divulge any personal or financial information to anyone who calls you unexpectedly. Companies and government agencies won't ask for such details over the phone.
KNOW THE SCAMS
Get wise to the scammers' ways.
They share some characteristics, even though they're always changing. They usually pressure you to take action quickly and keep the transaction a secret. And they want you to pay upfront for a promised prize or service, often with a prepaid gift card.
The National Council on Aging, an advocacy group for seniors, has links to common financial scams that are targeting seniors. Check out the list here: https://www.ncoa.org/economic-security/money-management/scams-security/top-10-scams-targeting-seniors/