Some studies estimate that as many as one in 10 aging Americans are affected by elder abuse each year. Other studies put the number close to 5 million individuals aged 60 and up – whatever the exact number is, experts suggest that it is a growing problem. And it carries a hefty price tag; American seniors lose billions of dollars annually due to elder financial abuse and scamming.
So what can you as a financial professional do about elder financial abuse? The first step is to recognize the signs, so you can help your clients understand areas of risk. Next, you can help your clients put solid plans in place, so they can rest assured that their wishes are honored no matter what. Finally, the key is knowing when to get additional help.
Knowing the Risks of Elder Financial Abuse
Older people are often targets of financial abuse because society tends to view them as vulnerable. They may not have someone watching over them, monitoring their every move or spending habits. Scammers may think older people are easier to confuse. People who are less skilled with computers are also popular targets for email and internet scams.
Your clients cannot protect themselves from a risk they do not know exists. It is important to make sure that your clients are educated on common scams, so the next time they get a suspicious phone call or message, they know to do their due diligence.
By helping your clients recognize the signs of common scams, you can help prevent elder financial abuse in your community.
The Signs of Elder Financial Abuse
The thing about abuse is that it is often well-hidden. Victims may be embarrassed or scared to reach out for help, or they may even downplay the abuse to their friends, family, and themselves. As their trusted financial professional, you owe it to them to be on the look out for their best interests. This is especially true with older clients who may be in the early stages of cognitive decline.
Elder financial abuse can manifest in many different ways, but here are a few common signs to watch out for:
- A client is suddenly quiet in meetings, contributing less to conversations.
- Strange financial activity – large or more frequent withdrawals, unexplained deviations from their financial or retirement plan, excess spending in new areas.
- Sudden financial troubles, like evictions or collections notices.
- Someone new becomes involved with finances, attending meetings, and making decisions, especially if that person is not a known or close relative.
- Missing possessions.
How to Prevent and Combat Elder Financial Abuse
It’s important to understand that anyone of any age can be a victim of financial abuse, and no two cases will look the same. But there are a few measures you can take to help protect your clients.
1. Discuss your client’s wishes and plans for their money early and often.
Financial, retirement, and investment plans are not “set it and forget it.” It’s important to check in with your clients about what they want over time, as their needs and desires may evolve through the years. This can help you stay aligned with your client’s wishes.
2. Designate a trusted family member or third party to defer to if needed.
It’s possible that your client may get to a point where they can no longer make responsible decisions for themselves or their finances. It’s important that you know who to turn to before that situation arises. You can also depend on this person for help if you believe your client is being taken advantage of by someone else.
3. Know the signs of elder financial abuse.
That being said, abuse may often come from someone the victim knows. Your client may benefit from having a network of support figures, that way there are multiple people to hold one another accountable.
Watching out for your client is an important part of building a relationship with them. Helping them understand the risks they may face – and not just the investment-related ones – can help them feel safer and happier as they get older.
If you believe your client is being abused, financially or otherwise, call the national Domestic Violence Hotline at 1-800-799-7233, or reach out to resources in your area.1097214-0320