Financial fraud has the possibility to wreak havoc on Americans’ retirement savings. Americans near or in retirement are often the target of fraudsters, who are enticed by savings accumulated throughout working careers and intended to last for the duration of retirement.
“Financial fraud can potentially erase lifelong savings in an instant,” said Cathy Weatherford, President & CEO, Insured Retirement Institute. “Learning to identify and avoid investment fraud is an important step toward attaining and maintaining financial security. Anything that can be done to shed light on the predatory tactics of fraudsters will go a long way toward preventing financial fraud and helping Americans protect their savings.”
Recent research has shattered the traditional concept of the financial fraud victim. Targeted individuals tend to be financially knowledgeable as fraud victims score higher on financial literacy tests than non-victims. Target consumers also tend to be college educated, have above average income, and are self-reliant when it comes to making financial decisions. Learning to identify and avoid fraud can help all Americans stay on their planned retirement course.
The likelihood of becoming a victim of financial fraud increases as consumers age and potentially have to grapple with cognitive impairment. Financial capacity, the ability to manage money and other financial assets, may be one of the first abilities to decline as impairment begins. These impairments are subtle, but can get worse over time. Developing a financial plan well in advance of possible incapacity—including setting up powers of attorney and trusts—is an important step toward safeguarding financial assets from financial fraud perpetrators.
To help explain more steps consumers can take to prevent becoming a victim to fraud and protect their retirement assets, the coalition has released Tips for Consumers: Fraud Prevention. The tip sheet has been FINRA-reviewed.
Click here to download a PDF copy of Tips for Consumers: Fraud Prevention.