So, are you just gonna take a leap of faith and hand your money over to a Financial Scammer?

A recent Barron’s article, Financial Scams Targeting the Elderly Are Rising. Advisors Offer Precautions , states, “Scammers relieve elderly Americans of as much as an estimated $36.5 billion annually.” 

It breaks my heart to know that in 2019, millions of elderly American’s are still being targeted by criminals posing as legitimate financial professionals. I am outraged by the fact that these scumbags are taking money from old people, and I get ticked off when legitimate people in my industry (and the vast majority are legitimate) get lumped in with these creeps.

Most adults know that investing money comes with inherent risk, but well rehearsed scripts and phrases designed to blur the line between facts and fantasies can become weapons of mass destruction when it comes to elder money.

Its a phone call or a knock on the door, and the con begins.

The elderly have become easy prey. While they may be the wisest and most experienced segment of our population, they are simply a more trusting bunch. One of the phrases to describe the scammer you will see pop up frequently is, “He reminded me of my grandson!”

But the elderly are also lonely and more apt to have long conversations with strangers just to fill the void of human contact. So, they wind up signing up for non-existent credit cards (a ploy to extract vital personal information), giving money to non-existent charities, and purchasing non-existent insurance policies and investments.

There should be a special place in hell for elder scammers, but to the extent that they will always live among us, if you are elderly, or are the adult child of elderly parents or grandparents, take some time to school them on survival tactics to insulate themselves from scammers’ malicious intent.

Tell them not to answer the door. Unless it’s the Girls Scouts and they need a new supply of Tagalongs, whoever is at the door unannounced is probably selling something. Maybe legit, maybe not. Don’t answer. 

There is no law that says you must answer a ringing phone. Call screening has literally become a lifesaver. If you have a cell phone, the name and number on the screen are unknown to you, don’t answer it. If the caller does not leave a message, block the caller. If they leave a message, decide whether you want to call back. Generally, don’t call back. If you don’t know them, and it sounds like a sales pitch, don’t let curiosity skin your cat. 

Other safe practices include immediately deleting suspicious emails, and not replying to them, of course, and never give out your personal information to someone you do not know.

There is no law that says you must answer a ringing phone.

And regarding salesmen (I have made a living in sales, by the way) never take a salesman at his or her word, demand proof, never buy on the spot, never make impulse decisions, and generally, put the sales person through the wringer! The crooks will run, but the good guys and gals will hang in there to make an honest case for their legitimate products and services.

Above all, learn to rely on your adult children, investigate the opportunities that appear to be legitimate, and always ask questions. For instance, if you are entertaining doing business with a new financial advisor, check their background, check their credentials and probe with impunity. From the Certified Financial Planner Board of Standards, here are Ten Questions To Ask Your Financial Adviser:

  1. What experience do you have?

Ask for a brief description of the financial planner’s work experience and how it relates to their current practice. CFP® professionals must have a minimum of two years professional experience related to financial planning.

  1. What are your qualifications?

Ask about the credentials your planner holds, and learn how they stay up to date with current changes and developments in the financial planning field. CFP® professionals expand their knowledge and stay informed through mandatory continuing education courses.

  1. What financial planning services do you offer?

Credentials, licenses and areas of expertise are all factors that determine the services a financial planner can offer. Generally, financial planners cannot sell insurance or securities products, such as mutual funds or stocks, without proper licenses. And they cannot give investment advice unless registered with state or federal regulatory bodies.

  1. What is your approach to financial planning?

Make sure the planner’s investing philosophy isn’t too cautious or overly aggressive for your needs. Learn how they will carry out recommendations or refer tasks to others.

  1. What types of clients do you typically work with?

Some financial planners prefer to work with clients whose assets fall within a particular range, so it’s important to make sure the planner is a good fit for your individual financial situation. Keep in mind that some planners require you to have a certain net worth before offering services. When you search for a CFP® professional on this site, you can specify your investable asset range to find a financial planner whose services best match your needs.

  1. Will you be the only financial planner working with me?

Some financial planners work with their clients directly, and others have a team of people that work with them. Ask who will handle your account, meet them and ask whether the planner works with professionals outside their own practice, such as attorneys, insurance agents or tax specialists. If yes, get a list of their names to check on their backgrounds.

  1. How will I pay for your financial planning services?

Planners can be paid in several ways: through fees, commissions or a combination of both. As part of your written agreement, your financial planner should make it clear how they will be paid for the services to be provided.

  1. How much do you typically charge?

Although what you pay will depend on your particular needs, the planner should be able to provide you with an estimate of possible costs based on the work to be performed. Costs should include the planner’s hourly rates or flat fees, or the percentage of commission received on products you may purchase.

  1. Do others stand to gain from the financial advice you give me?

Ask the planner to provide you with a description of his conflicts of interest in writing. For example, financial planners who sell insurance policies, securities or mutual funds may have a business relationship with the companies that provide these financial products. CFP® professionals agree to abide by a strict code of professional conduct and have an ethical obligation to put your interests first when delivering financial planning advice and services.

  1. Have you ever been publicly disciplined for any unlawful or unethical actions in your career?

CFP Board, the Financial Industry Regulatory Authority (FINRA) and your state insurance and securities departments each keep records on the disciplinary history of financial planners and advisors. Ask which organizations the planner is regulated by and contact these groups to conduct a background check. CFP® professionals are subject to disciplinary action if they violate CFP Board’s standards.

Of course, you can ask any question you like, but the point is this: You have to walk away convinced that this financial professional is the real deal, legitimately worthy of your trust, knows what they are talking about, has the requisite and verifiable credentials of a pro, and has long experience in their field. And while it still may be a leap of faith to say “yes,” at this point, maybe a toe in the water isn’t such a bad way to go!

The terms “Certified Financial Planner “and “CFP ” are exclusively reserved  for professionals who successfully complete initial and ongoing certification requirements established by the Certified Financial Planner Board of Standards Inc.
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