Statistics show that baby boomers today control more than $13 trillion in assets is which more than 50 percent of total U.S. household investment assets (Securities and Exchange Commission’s Office of Compliance, 2008). Projections also show that nearly one in every six Americans will be 65 or older by the year 2020 (Securities and Exchange Commission’s Office of Compliance, 2008). By the year 2030, nearly 20 percent of the U.S. population will be ages 65 and holder.
Also, according to the Securities and Exchange Commission (SEC), approximately five million senior citizens fall victim to financial abuse each year and to address this major problem, the SEC organized a Seniors Summit to raise awareness of this very issue (Securities and Exchange Commission, 2008). Family and Consumer Sciences (FACS) must play a proactive role in educating senior citizens in regard to wise investment as well as in protecting them throughout their employment and retirement.
One article in USA Today indicated that while people 60 and older make up 15 percent of the U.S. population, they account for about 30 percent of fraud victims (Chu, 2006). It is also important to note that the number of fraud victims may even be higher due to the fact that many do not report suspected fraud out of shame and embarrassment and fear that they may be seen as unfit to handle their own finances. In 2005, consumers 50 and older comprised one-third of total fraud and one-fifth of all identity theft complaints among those who reported their age (Chu, 2006).
To compound the problem, the current financial crisis is fueling a frenzy of aggressive and unethical sales tactics. According to the North American ecurities Administrators Association (NAASA), one of the top 10 threats to Sinvestors is senior investment fraud. Seniors have built up a lifetime of savings and thus continue to face investment fraud by con artists who are peddling investments that are either fraudulent or unsuitable for the elder’s particular financial needs (North American Securities Administrators Association, 2005). Another result of the looming financial disaster was seen in the popularity of phishing and identity theft, where advances in technology proved to be extremely innovative.
One article by the USA Today acknowledged this fact by indicating that the number of malicious programs circulating on the Internet tripled to more than 31,000 a day in mid-September, coinciding with the sudden collapse of the U.S. financial sector (Acohido and Swartz, 2009). Protecting senior citizens from such financial victimization is critical. If the elderly population does not have an advocate, potentially millions of older people could come dependent on other family members or government assistance.
One example of an excellent resource that extension agencies can utilize is Texas Tech’s “Red to Black” Web site, which provides examples of prevention measures that can be taken in order to prevent identify theft. Examples of these simple actions include the following: (Texas Tech University, “Red to Black,” 2009).
• Shred all documents with personal information, to include bank statements, receipts, canceled checks, credit card offers, medical bills, and insurance documents.
• Keep your PINs in a secure place – away from your checkbook, ATM, or debit cards.
• Do not carry your social security card in your wallet or purse, as these items can be stolen.
• Ensure that password protection exists for credit cards, bank accounts and phone accounts.
• Be careful with whom you share your personal information, especially your social security number. Do not give personal and financial information over the phone.
• Receive a free credit report once every four months from one of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion. By utilizing each agency once per year, one can rotate agencies every four months. (www.annualcreditreport.com)
• Carefully review financial statements