Scams targeting older adults out of their hard-earned money is a big business. The Federal Trade Commission (FTC) reports that, contrary to popular belief or stigmas, mature adults in the United States are actually less likely to report losing money to online fraud than younger folks. But, those 70 and over reported much higher individual losses.

  • Median reported loss for people 18-59: $500
  • Median reported loss for people 70-79: $800
  • Median reported loss for people 80+: $1,500

Looking at the numbers all-in, 5.7 million people filed reports and described losing more than $5.8 billion to fraud in 2021 — a $2.4 billion jump in losses in one year. What’s even more worrisome is that this figure is likely just the tip of the iceberg, since the FTC is only aware of fraud reported by those who have been scammed. There is no way for the FTC to know how much fraudulent activity goes unreported.

With online fraud being most prevalent during the holiday season, it’s an important time to stay alert and vigilant as you shop for loved ones online (and treat yourself, too).

It’s understandable why con artists choose to target retirees for their more expensive scams. Many retirees are less likely to have someone to help them identify scams, which is in part because of the social isolation many older adults experience, and in part because of the discomfort of changing family dynamics. After years of being the family CFO and financial decision-maker, retirees can feel awkward asking their adult children for advice.

The important thing to remember is that you can protect yourself, your money and your family from scammers. Whether you’re looking out for yourself, your parents or your adult children, here’s what you need to know to keep your money out of a con artist’s hot little hands this holiday season.

Types of Scams to Expect

Although con artists are constantly coming up with new and innovative ways to separate you from your money, there are truly only a few types of schemes that they use. Everything else is just a variation on one of these five themes:

1. Scammers Ask for Banking Information

One of the most common ways for a scammer to get your banking information is for them to call you or email you, posing as a customer service agent, and simply ask you to verify information about your account.

We are so used to doing this sort of verification when we call our banks and credit card companies that it can seem natural to give your Social Security Number to the professional-sounding stranger on the other end of the phone who asks nicely.

But you should never give out identity-related information to someone who initiates contact with you. What you should do is hang up on the caller and contact the institution directly. Then you can determine if the initial caller was legitimate.

Do likewise with emails that appear to be from your bank or other financial institution that ask you to reply with identifying information. Contact your bank directly to find out if there is an action you need to take. If there is, navigate to your bank using the official website, not through a link in the email—these can sometimes direct you to a scam site that looks legitimate but actually is capturing your log-on credentials.

2. Scams Exploit Your Fear

Fear has a way of short-circuiting our rational responses, which is why scammers often aim to make their targets feel afraid. If you are scared, you are more likely to send money first and ask questions later.

Here are some of the most common ways that scammers try to exploit your fear:

  • Grandchild in trouble. With this scam, you receive a call from a young person who sounds a little like your grandchild. They tell you they are at the hospital/in jail/otherwise in trouble and need money, and then they beg you not to tell their parents. It’s natural that you would want to protect your grandchild and these scam calls can sound very convincing. But rather than wiring money right away, call another family member to find out exactly where your grandchild is.
  • Lost money. In this case, the scammer will show you some sort of “evidence” that your account is empty or that you are about to lose your benefits. The con artist will then promise to fix the problem—for a price. As with other unsolicited calls from institutions, the key to thwarting this scheme is to hang up and check the information yourself through official channels.
  • Imposing institutions. Scammers will sometimes claim to be calling from the IRS, using your anxiety about everyone’s favorite government institution as a way to get at your money. Similar schemes involve scammers claiming they are from the power company and they will shut off your power if you don’t pay right then and there. It’s important to remember that the IRS will only correspond with taxpayers through the mail, even in the case of an audit or other serious issue. And any other threatening call can be checked with the institution.
  • Threats. In many cases, scammers will start using more direct threats if you have already given them some money and are balking at the idea of sending more. These con artists rely on both your natural reticence about sharing financial information—and your fear of their threats—to keep you from doing what’s best for you: contacting the authorities. If a scammer has started threatening you or your family, call the police and report the situation. Threats are a police matter, and you do not have to deal with them alone. You also should report the scam to the FTC.

3. Scams Exploiting Your Greed

Another easy way to short-circuit your rational thought processes is to put dollar signs in your eyes. These scams promise a big payout for a “small initial investment.” This is the basis of the infamous Nigerian email scams, yet you can find any number of greed-based scams out there.

One of the more common scams tells you that you have won the lottery, but you need to prepay the taxes in order to receive your prize. Scammers pretending to be calling with your lottery money may also solicit your banking account information in order to “deposit” your winnings.

Retirees also are often targeted with “no-fail” investment schemes that promise the moon and stars. This can be particularly tempting to an older adult who is feeling a little worried about the size of their nest egg. But after putting down your investment, the scammer disappears with your money.

4. Scams Exploit Your Sympathy

Con artists often use your compassion against you to get your money. The most common version of this is the charity scam, which you’ll often see in the wake of a major disaster. Fraudsters will set up fake websites that mirror actual charities, in addition to making phone calls and going door-to-door pretending to represent the charity.

The other way scammers exploit your better nature is to convince you that they personally are in dire straits and need your help. This kind of scam usually relies on an already-established relationship, and is often the end result of a romance scam or other long-distance “friendship.”

In both cases, you can protect yourself by only giving money directly. Donate to charity directly, rather than through phone, email, or door-to-door solicitations. If a friend says they need money for rent or a medical procedure, offer to pay the landlord or hospital directly.

The FTC compiled a list to help make sure your dollars count for good, including researching the charity name plus “complaint,” “review,” “rating,” or “scam.”

5. Scammers Play the Part of an Expert

Scammers often target those who are feeling overwhelmed by their financial decisions, since it can feel like a relief to hand those choices over to someone who clearly knows what they are doing and wants to help. But a con artist doesn’t actually have to know anything to be able to fake competence.

Older adults in particular are vulnerable to “experts” who offer to help them with financial problems. These can range from inappropriate annuities to reverse mortgage fraud. This is why it’s important to always get a second (and unbiased) opinion before you go ahead with any financial opportunity. Don’t let the expert who is selling you something be the only expert you talk to.

A similar tactic is when a scammer calls to “alert” you to a critical issue with your home computer system or network. Often, scammers claim there is a problem with security and offer to help protect your computer and files from viruses or hacking. These “tech support” calls can sound very convincing, and they play on the assumption that some older adults are not tech savvy. As a rule, you shouldn’t expect to receive inbound tech support calls from your computer or service providers.

Other Scam Tactics to Recognize

No matter which scam a con artist is trying to pull over on you, it’s likely that they will add some of the following tactics in their attempt to get and keep your money:

1. Time Pressure Scams

Putting a deadline on a financial decision is a tried-and-true sales technique that plays on our fears of losing money on a deal. Scammers also use this trick to get you to react to their pitch without thinking. They often will tell you that there is no time to think things over or that the price will go up if you hesitate.

This is why you should always take the time to research any opportunity before you hand over any money. If the opportunity is legitimate, they won’t mind if you take some time to do your homework. If it’s not, then they’ll put on the pressure to get you to hand over the money quickly. Don’t let yourself be financially pressured by a ticking clock.

2. Peer Pressure Scams

An easy way for the scammer to encourage you to do what they want is to make it seem as if everyone else is already doing it. You don’t want to be the only sucker who doesn’t sign up for the opportunity, and the scammer will be sure to highlight all the other “savvy investors” who have signed on the dotted line. Worrying that you will be left out can lead you to follow the herd rather than asking tough questions.

3. Gift Card Scams

Scammers often ask to be paid in gift cards. There’s a reason for this preference: Once the scammer has the code from the back of the gift card, the money is gone and virtually impossible to trace. If someone is asking to be paid in gift cards, it’s a scam. Gift cards are meant for giving gifts, not making payments.

4. Scams That Sell Your Name

One of the devastating aspects of falling victim to a scam is the fact that it often triggers more scammers to call you. That’s because scammers will often pass along names of targets who paid out, so you may find yourself fielding even more shady phone calls and emails after the first one.

Protect Yourself and Your Money

It can be very easy to assume that you are too smart to fall victim to one of these schemes. But scammers are in the business of extracting money from people, and they understand the specific ways your emotions can affect your financial decisions. Not getting taken has nothing to do with intelligence.

The best way to protect your money is to have strong money rules in place. Adopting and strictly adhering to the following five rules can help you avoid scams:

  • Don’t give out identity-based information to anyone who contacts you. Initiate contact with the institution yourself to determine if you need to share your information.
  • Trust your gut. If someone feels weird or off, even slightly, err on the side of caution and call the organization directly. Do not click any links or things that seem phishy, even if they appear to be from someone you know (e.g. through Facebook messenger).
  • Double-check all unsolicited information you receive.
  • Get a second opinion about any financial opportunities offered to you.
  • Take at least 24 hours to make any major financial decisions.
  • Ask questions. Scammers hate questions, while legitimate callers will not mind answering them.

When it comes to your finances, or those of an aging parent or adult child, you can never be too careful. With these five basic rules in place, you can help thwart scammers from making off with your cash.

What has been your experience with scammers who target older adults? If we’ve missed any common types of fraudulent calls you receive, please let us know in the comments below.