Preventing Fraud, Keeping Your Money Safe
As another generation of Americans move into a period of savings distribution, opportunities for those looking to commit fraud are abundant. With this move away from wealth accumulation, detecting and preventing fraud is imperative to providing financial security in retirement.
Cathy Weatherford, President & CEO of the Insured Retirement Institute, has worked to prevent financial fraud her entire career. “By utilizing electronic communications designed to appear legitimate, fraudsters have been able to take advantage of the trusting nature of many Americans. Financial fraud can potentially erase lifelong savings in an instant,” said Cathy. “In the electronic age we live in, it has become easier for fraudsters to appear legitimate and trustworthy. 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 helping Americans protect their savings.”
Unfortunately, fraud can happen to anyone. In fact, research has shown that victims of fraud tend to be financially knowledgeable and 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.
The chances of becoming a victim of financial fraud increase with age and the onset of cognitive impairment. One-fifth of Americans aged 71-79 are affected by cognitive impairment, and that percentage increases to 50 percent during the next decade of life. 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 is imperative for those near retirement age. Establishing powers of attorney and trusts, for example, are important steps 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, download NRPC’s FINRA-Reviewed Tips for Consumers: Fraud Prevention