Here's some sad retirement planning news: If you're going to be swindled in your old age, the person most likely to do it is a family member or a trusted friend.
The Investor Protection Trust, an organization founded in 1993 by a group of states' attorneys general in the wake of a lawsuit over investment management company misconduct, recently took a look at elder fraud and came to an unsettling realization. Seventy-nine percent of this kind of abuse is perpetrated by friends and family, according to a survey of financial and law enforcement experts. Caregivers and outright swindlers also play a role, the survey found -- with overlap in some cases.
So if you can't trust the people you know and love, how do you protect yourself from losing your retirement savings to a crook?
The Investor Protection Trust gives these three suggestions.
- Get education about fraud, and learn the way things ought to work. Recognizing that you might be dealing with a dishonest person will protect you better than anything else, the Investor Protection Trust says. It is especially supportive of programs presented by local community organizations because they usually feature speakers who are familiar with scams and scammers operating in the local area.
- Get an annual physical from a trusted physician and include in your medical records a medical power of attorney so the doctor can alert someone who you know is trustworthy if your mental capacity diminishes to the point where it might be difficult for you to handle your own money.
- Be skeptical. People old enough to be retired have had a lifetime of experience. If the deal someone offers you sounds too good to be true, it probably is.