Protecting Yourself from Financial Scams

Recognize Your Vulnerability

The world changes every day, and while many changes are beneficial, others bring risks. The internet has expanded opportunities for connection, but it has also opened the door for a new type of scammer. These fraudsters are intelligent and savvy, exploiting people’s fears and emotions to manipulate them. The good news is that there are ways to minimize your risk. Here are some tips:

Stop Legitimate Junk/Consumer Mail

Businesses often send circulars, leaflets, and promotional mail. While most of these are legitimate, you can stop unwanted mail through services like DMAchoice. By reducing the amount of legitimate mail, you'll be able to more easily identify any fraudulent correspondence.

Save Fraudulent Mail

If you receive any mail that seems suspicious or fraudulent, make sure to save it. Report it to the US Postal Inspection Service to help stop the scam from spreading.

Monitor Your Credit Scores

One of the best ways to detect fraud is by regularly monitoring your credit scores. Services that track your credit activity can alert you to any unauthorized activity, such as the opening of new credit cards or loans. While there are paid services, it’s essential to stay aware of any changes to your credit status. If possible, opt for services that block the opening of new credit cards without your permission.

Make Yourself Invisible

Take steps to limit your exposure to potential scammers by making yourself as "invisible" as possible. Remove your phone number from public directories and replace your landline with a mobile phone. You can also add your number to the Do Not Call list. Additionally, don’t answer unfamiliar numbers; let them go to voicemail, and return calls only if you’re familiar with the person.

Protect Your Passwords

Your passwords are personal and should be kept secure. No one—whether over the phone or online—should be able to access them. Only share passwords with trusted individuals, such as a spouse or adult children who assist in managing your accounts.

Create a Second-Party Bank Account

If you feel you may be more vulnerable due to forgetfulness or aging, consider setting up a joint bank account with a trusted adult child. This provides an extra layer of protection and helps ensure that your finances are closely monitored. You’ll still have control over your spending, but the second-party signer can help prevent any unauthorized withdrawals.

Power of Attorney

If you’re concerned about making financial decisions without oversight, consider giving a trusted person power of attorney. This doesn’t mean losing financial freedom—it just ensures that any significant financial decisions, like major purchases or opening new credit cards, are made with their consent.

Maintain Your Dignity While Seeking Help

If you believe you've fallen victim to a scam, don’t feel embarrassed. Scammers are professionals at manipulating people. If you suspect you’ve been scammed, seek help immediately. Reporting the scam can prevent further losses and help protect others from falling prey to the same fraudsters.

Watch Out for Popular Scams

Scammers often use the same tactics repeatedly. Here are a few common scams to watch out for:

Grandparent Scam

This scam involves fraudsters impersonating a grandchild, claiming they’re in trouble and urgently need money. They often say, “Please don’t tell my parents!” The victim sends money, but the real grandchild is unaware. Solution: If you get a similar call, tell the caller you’ll call back. Verify with your adult child before sending any money.

Charity Scams

While many charities are legitimate, scammers often pose as fundraisers to steal money. Solution: Set a budget for charitable donations and stick to it. If someone calls asking for a donation, let them know you’ve already contributed to your chosen charities.

Repair Fraud

Scammers often pose as repairmen, charging for unnecessary services or work that wasn’t done. Solution: Always get a second opinion before agreeing to repairs, and if possible, have a trusted person with you during estimates. Be vigilant about checking your credit card and bank statements for repeat charges.

Free Money Scams

These scams promise “free money” or huge prizes in exchange for personal information or an upfront fee. Solution: Remember: there’s no such thing as free money. If someone asks for payment or personal information upfront, it’s a scam.

Government Scams

Scammers often impersonate government agencies like the IRS or Medicare, threatening dire consequences to scare victims into giving money or personal information. Solution: Legitimate government agencies never ask for personal information over the phone or email. Always verify government websites directly before filling out any forms.

For more tips on protecting yourself from scams, visit the FTC Scam Alert page.