Scams That Target Your Retirement SavingsJohnathan Douglas
Wherever there is money, scammers are likely to show up, and that’s true of retirement savings. Scammers and hackers use a variety of methods to gain access to your hard-won funds, but you can protect your financial future with a combination of common sense and due diligence.
Too-Good-to-Be-True Solutions Are Usually Problems
It’s tempting to look into a savings or investment solution that claims to be bulletproof. With so much uncertainty in today’s markets — and the relatively recent panic during 2008 and 2009 — someone saving for retirement would be foolish not to want financial stability. No investing solution can offer a 100 percent guarantee, though, and higher returns are usually related to bigger risks. Don’t buy into claims that your small investment will double quickly in some wild scheme, and always do your research before you hand over your money.
When researching potential investments or retirement savings plans, look for:
- Evidence of historic performance, including financial reports.
- Reviews from past and future customers.
- Easy access to information about the investment.
- A variety of contact methods; never give your money to an entity you can’t get in touch with.
It’s Your Money, so Keep an Eye on It
Whether you chose to work with a broker or self-manage your own investments and IRAs, your money is what’s ultimately on the line. Scammers can pose as brokers and service providers, siphoning away your money slowly or skimming it from your accounts. Even a legitimate broker can get scammed, and the issue might go unnoticed until it’s too late because that broker works with numerous clients and can’t keep a close eye on everything. Keep your investments safer by:
- Checking your accounts and statements on a regular basis.
- Making use of online portals to keep an eye on your money.
- Asking questions if you don’t understand something or it seems odd or wrong.
Desperate Measures Make You a Target for Scammers
If you’re nearing retirement age and figure out you haven’t saved enough to support the lifestyle you intend, you might want to take measures to boost your savings. Looking for get-rich-quick schemes or abnormally high returns makes you a target for scammers who prey on investors with sweet sales tactics and bait-and-switch products.
Options and plans do exist for supplementing retirement savings in later years, and some people are able to retire early because they get lucky with investments or are diligent in saving when young. You should never count on consistent 25 to 50 percent returns to fill your retirement coffers, though, and conduct comprehensive research if you’re presented with an offer that makes such claims.
One investment with a proven track records is gold, but scammers even infiltrate these markets. When buying gold or investing in a gold IRA, work with an established, proven company to better protect your interests.
Special: IRA, 401(k) & TSP Scam