Have Your Parents Fallen Victim to Elder Fraud?
By Ric Edelman
Don't be so sure they haven't
Are you confident in your parents’ ability to manage money? You probably are — and your confidence is probably misplaced. Like you, most people who have older parents are confident in Mom and Dad: The Investor Protection Trust found that 89% of adult children with parents age 65 or older are confident in their parents’ ability to handle their personal finances — but half of Americans over 65 have experienced financial victimization, according to its survey.
Older people say they have given money to people who have simply asked for it, have felt unconfident when making important financial decisions, have made loans or gifts they don’t feel they can afford, or believe that the bills they receive are confusing and have difficulty paying them. More than a third report that people call or mail them asking for money.
Twenty percent of those 65 or older reported having been taken advantage of financially, including outright fraud. Far fewer adult children said their parents had been swindled. Obviously, parents aren’t always telling their kids that they’ve fallen victim to a scam — even though 80% of adult children believe their parents would tell them “immediately” if they have been swindled. Among the 16% who think their parents would be ashamed and keep it to themselves, 61% think they’d be able to figure it out.
If you’re making the same assumptions about your parents, you may want to think again. Is it possible that your parents are having trouble making financial decisions or have been victims of elder financial abuse? You won’t know unless you ask.
It’s not always easy to talk with your parents about their finances, but do it anyway. Show them this article as a way to start the conversation. Your parents are older now, and one-third of older Americans suffer from diminished mental capacity or outright dementia — giving you ample justification (if not the downright obligation) to talk to your parents openly about their finances. If you don’t find out now whether they are still comfortable handling money and making financial decisions, you’ll find out later — the hard way.
Originally published in Inside Personal Finance September 2010