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July 15th, 2017

Money Matters

By Chris Teague

Aging is a very unique experience, bringing changes to peoples' lives physically, socially, financially, and emotionally. Many people know where to turn when they have an ache or pain, but it can be much more difficult for someone to both recognize the need for financial help and then actually reach out to a professional to deliver that help. Money is such a personal topic for many people that they would rather discuss their most detailed health history with a doctor than their credit history with a financial adviser. This creates a wealth of opportunities for scammers to take advantage of seniors and can mean that some peoples' financial situation is totally out of control before anyone is able to step in and help. With planning and a willingness to be proactive and honest, however, anyone can keep their financial house in order.

Do Your Research

While there may not be a "problem", the best way to keep your finances in order is to realize that no one person has all the answers and that money, investments, and credit are complicated things, even more so as we age. The need for a financial coordinator or adviser that is independent and certified in their area of expertise cannot be understated, but it's important to also take note of the different types of advisers and the various financial areas they specialize in. The FDIC, Consumer Financial Protection Bureau (CFPB), and Financial Industry Regulatory Authority (FINRA) all have guidelines and publicly available standards to help you choose an expert that is both legitimate and is one that fits your specific need. Links to some of these guides are included at the end of this article.

Proper Prior Planning

Once you have begun the process of organizing your financial life, it is also vital that you create a plan for the time when you may no longer be able to handle control and communication around your finances. Life can change suddenly at any age, and having set up a roadmap for what should happen when things change will save a lot of headaches (and potential legal battles) as they do. An attorney can help guide you toward a plan that will work well for your situation and your family, such as a power of attorney scenario, where you designate someone to make key decisions about your personal and financial life in the event you become incapacitated or unable to act in your own best interests. Most banks also have advisors that can help set up account signers and co-owners to help keep control of your money, but keep in mind that the person that is listed on the account with you has access to those funds at all times and without restriction. Think carefully about decisions like this, as that person's debts and financial troubles could become your issues as you become tied to them through bank accounts.

Avoid Scams

One of the most frustrating and dangerous parts of modern life is that a person can contact anyone else by phone, internet, or other method, and can claim to be anything they want. Scams and predatory lenders have been in the headlines frequently over the past few years, especially as so many more people gain internet access and sign up for cellphones. Electronic communication channels have created a lot of "dark space", where scammers can call or email from almost anywhere in the world and the person receiving the communication has no way of really knowing who they are. Scams targeting seniors are especially dangerous, as they focus in on the things that aging people worry about the most like taxes, property ownership, and family safety. A scammer will call or email seniors, letting them know that a relative is going to jail for unpaid taxes or saying that a property will be placed into foreclosure if a fee isn't paid.

There will likely be no immediate way of knowing who is calling you or where they are from. The communication may sound or look official, and can be very intimidating. The good news is that the IRS or other federal agency isn't going to call you and tell you that you're going to jail, but getting a call like this can definitely be unnerving. The most important thing you can do when you get a call, email, or letter is to remain calm. Secondly, consider calling the CFPB or IRS directly to question and verify the validity of the communications you are receiving. Report the number to your phone provider or block the number on your mobile phone. Absolutely do not give out any personal information over the phone, and do not pay, wire, or transfer funds to anyone that you do not absolutely know is who they say they are. Keeping an eye on your credit report will help you understand the various accounts and payments that are being set up in your name as well - www.annualcreditreport.com or call 1-877-322-8228.

Being open, honest with yourself and family, and keeping an updated financial plan will all be great steps toward maintaining a healthy relationship with your money, but they aren't the only things you should focus on. This article is the first in a series of pieces on financial health and avoiding scams.

Sites to help make financial decisions:

FINRA Investment Adviser Search

CFPB Resources for Seniors