Planet Antares Scam Offers Ways to Avoid Elder Scams
Today’s scam artists are increasingly targeting elderly persons, many of whom may be vulnerable due to age, diminished capacity and their relatively large personal savings. Investor Protection Trust, a non-profit organization dedicated to improving investment education, says that one in five American seniors has been the victim of a fraudulent scam.
The most common scams targeted at older Americans involve investments in risky or non-existent products, unneeded insurance or loans, and false requirements for enrollment in legitimate benefit plans. Investment program pose a particular risk because many seniors don’t appreciate the risks involved in certain investments or are easily persuaded to join investments that are not appropriate for someone their age or in their financial position.
To avoid scams targeted at older persons, or to help an older person avoid an investment scam, here are a few helpful tips.
Avoid scams that require the participant to borrow in order to invest. Many scam artists try to talk older persons into taking a reverse mortgage on their homes in order to fund an investment. Too often, these investments are exceptionally risky, or can’t deliver the promised returns. The investor is left with a diminished asset value and no investment returns.
Preservation of accumulated wealth rather than the creation of additional capital is generally more appropriate for a senior citizen. The safest strategies for older investors are those that are designed to meet specific needs. For example, investments that can provide supplemental ordinary income, help cover the cost of catastrophic health care, or provide long-term care are worth more to a senior citizen than those investments that offer the potential of a higher return but pose a higher risk.
Senior citizens are eligible for a large number of benefit programs offered through Social Security, Medicare and the Veterans Administration. Generally speaking, it does not cost the beneficiary to enroll in a government benefit, however some benefits, like Medicare, may have premiums associated with them. Working directly with these agencies, rather than working through an intermediary, can help protect senior citizens from being taken advantage of.
Senior citizens and retirees don’t need as much insurance as someone who is still working and may still have obligations to repay or dependents to support. A popular scam involves persuading a senior citizen to buy worthless or expensive life insurance coverage in order to have something to leave for loved ones. Life insurance shouldn’t be used to provide an inheritance, but rather to meet any financial obligations the insured may still have. If a person has no debt obligations, life insurance in any form is largely unnecessary.
