If you're worried about your grandma or grandpa falling for a financial scam, one company is hoping to help calm those fears with a prepaid card. California-based True Link offers an alternative banking product designed to help seniors maintain financial independence while preventing them from falling into traps by identity thieves and other online financial scams.
Here's a quick look at how the card works. A caretaker or family member can order the card for their loved one and customize the card with maximum charge amounts, blocked merchants and the ability to disable ATM withdrawals.
True Link also keeps a running list of known online scams and problematic merchants that have been known to prey on unsuspecting seniors. The card will automatically prevent certain purchases, and it will also immediately alert the caretaker of suspicious approved purchases via text message or email.
Kai Stinchcombe, the company's founder, says that the card was inspired by his own efforts to monitor his grandmother's personal finances and sort through deals such as hearing-aid scams, magazine subscriptions, fake charity donations and "free" trial programs from TV offers.
The card does come with a price tag. After the first year, True Link has an annual $20 fee. That is certainly much higher than other banking alternatives, but standard services such as loading cash on the card, making purchases and contacting customer service do not cost extra.
There's evidence that the fee might be well worth it, too. A study conducted by MetLife in June 2011 indicated that victims of elder financial abuse collectively lose an average of $2.9 billion each year. While no one wants to pay an annual fee for their money management, no one wants to untangle a mess of personal finances after a financial scam, either. Reversing fraudulent charges and opting out of subscription-based services and products can be very challenging.
What do you think of the prepaid card? Do you think it's worth $20 each year?