While you might not think much of it, knowing how to protect your assets is one of the most important things that you need to know in order to navigate life as a senior more comfortably. Now, this might sound simple to you at face value but you’d be surprised at the number of pitfalls when it comes to the state of your assets.
We know that the last thing you want is to lose everything you worked hard for. Luckily, there are several ways to protect your assets especially if you’re willing to learn and make the necessary preparations. By drafting the proper documents and making wise decisions, you’ll be able to keep all your assets intact.
Now, we know that that sounds like a lot of work. This is why you’ll want to utilize all the help you can get. This is why we thought it would be useful to create a short guide on how to protect your assets. If you want to know more about the common threats to your assets and how to circumvent these threats, read on as we break down how to protect the assets of seniors.
Common Threats to the Assets of Seniors
Before we begin talking about the ways to best deal with the threats to the assets of seniors, it’s important to know more about them. This allows you to deal with these threats more effectively or in some cases avoid them altogether.
You may be surprised to know that these threats vary wildly. While some may be obvious, some of these threats are quite unexpected as you may not realize that some things that you may have initially considered to be trivial actually pose a huge threat to your assets.
If you think people are beyond scamming the elderly, then you’d be wrong. Scams are one of the most common and most significant threats to the assets of seniors. In fact, scams manage to cheat seniors out of $3 billion annually. What makes scams so dangerous is that they all adopt different strategies to try and steal money from seniors.
And while it would be incredibly impractical to go through the list of all the scams that are directed towards seniors, we can give a brief summary on the most common ones. Hopefully this information proves to be useful when it comes to preventing more seniors from falling prey to these devious tactics:
- IRS Scam: One of the most common scams targeted towards seniors is the IRS scam. This is when fraudsters impersonate representatives of the Internal Revenue Service. The way this scam works is rather simple. All the scammers have to do is to cold call seniors and inform them that they have unpaid taxes.
They then proceed to threaten the seniors with the possibility of arrest if they don’t settle their unpaid taxes immediately. The reason why this is so effective is that the scammers often utilize the numbers of the government agencies by spoofing them. Variations of this scam utilize other threats such as the senior’s benefits getting taken away.
- The Grandparent Scam: This is one of the more despicable scams targeting seniors. The way it works is simple: scammers call the unsuspecting senior and pretend to be their grandchild. They do this by opening the call by saying something along the lines of “Hi grandma/grandpa, do you know who this is?”.
From there, the scammers basically get the seniors to lower their guards. They will then proceed to ask them for money for fake emergencies such as overdue rent, car repairs, and sometimes even jail bonds. This scam is so effective because the scammers ask the seniors to not tell anyone as this could be embarrassing.
- Medicare/Health Insurance Scams: It’s quite ironic that something that was created to take care of seniors ends up being used as a way to scam seniors out of their hard-earned money. This scam takes a little more work as the scammers will need to research which health insurance company their target makes use of.
Once they have the information that they need, the scammers then proceed to impersonate health insurance representatives to get either the personal information of the seniors or will try to sell them fake services in order to steal their money.
Legal Document Abuse
While scams are a serious threat to the assets of seniors, it’s also important to know about the “legal” ways that seniors can have their assets taken away from them. This usually manifests in the form of legal document abuse.
Legal document abuse is when seniors are tricked into signing documents that they do not fully understand. This usually results in their assets getting turned over. This can be a serious problem as seniors may end up making drastic changes to their will, trust, or transfer on death deeds.
It pains us to say that seniors who have cognitive issues are incredibly prone to this type of financial abuse. So much so that the Center for Disease Control and Prevention had to come out with a guide on how to best protect individuals with cognitive impairment from financial exploitation.
Misuse of Authority
Lastly, misuse of authority is also a common cause of threat to the assets of seniors. This can be quite troublesome as this means that financial advisors have abused their position and have betrayed the trust of their clients. They do this by getting seniors to buy into annuity scams wherein the money that’s invested will not pay off for 10-15 years. By that time, their clients would have already passed away.
Aside from annuity scams, financial advisors who are looking to make easy profits take part in excessive trading and investments in high-fee funds. These are designed to generate commissions for the financial advisors but don’t really pay off for the seniors themselves.
Best Ways to Protect Your Assets
While we hate to admit it, elder financial abuse is quite common. This is because seniors tend to put their trust in people who don’t always have their best interests at heart. And while the perpetrators are entirely at fault for even wanting to take advantage of senior citizens, there are steps that you can take to prevent this from happening.
Be Aware of Common Scams
Now, there isn’t really any way to avoid scams other than being aware of them. By being aware of common scams, you give yourself the ability to spot them once they target you.
Knowing about scams helps you circumvent them and avoid giving away your money and personal information. You’ll want to keep yourself in the loop when it comes to scams, as scammers tend to come up with new strategies.
Purchase Protected Assets
One of the best ways to avoid threats to your assets is by purchasing protected assets. Think about it this way, money can be easily taken away. However, if you invest the money into something that’s more secure then the safer your money will be from fraudsters and other threats.
You can go about this in different ways. However, we suggest considering renovations to your home or purchasing larger property altogether. Another effective way to go about this to prepay your property taxes.
We understand that this may be a lot of work, especially for senior citizens. However, you’ll be glad to know that you can actually start preparing for this early on. This is the best way to go about doing things as you have more physical and mental energy when you’re in your 50s or 60s.
When it comes to things you’ll want to plan for, make sure to decide on when to transfer decision making powers to your heirs. This will protect you from any financial abuse, as your trusted family member will be taking care of everything for you.
Lastly, it would also be in your best interest to start estate planning as early as possible. This will save your loved ones the trouble of jumping through legal hoops after you pass just to get your assets in order. While there are many things you’ll want to arrange, simply having a will ready makes everything infinitely easier for your loved ones.
While this can be quite daunting, making the necessary preparations and being wary of financial abuse will make it easier for you to enjoy your golden years. We hope the information that we’ve laid out proves to be useful when it comes to protecting your assets. Be sure to keep all of this in mind when making any major financial decisions to avoid any problems or complications.
Navigating life as a senior citizen can be quite difficult. Luckily, you don’t have to do this alone.
If we missed out on anything, let us know!
Senior Outlook Today is your go-to source for information, inspiration, and connection as you navigate the later years of life. Our team of experts and writers is dedicated to providing relevant and engaging content for seniors, covering topics such as health and wellness, finances, technology and travel.