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Budgeting

How to Protect Your Finances

There’s a persistent stereotype surrounding seniors, which is that they’re easily separated from their money. Even if something is completely legal, the result might not be beneficial. But there are ways to ensure that you and your money maintain a good relationship. If you follow these tips, you’ll be able to hold on to your savings.

Be Cautious

The first and perhaps the most important way to hold onto your money is to be cautious about who you deal with. No one wants to get scammed, but certain con artists tend to target older adults, thinking they’ll be more likely to fall for the scam.

It’s unfortunate that this can sometimes be the case, and tough you’ve probably heard this time and again, we’re living in a different world of technology. While someone you meet face to face may seem unsavory, the right words and images coming at you online could draw you in.

The best bet, whether you’re approached in person or online, is to go with your gut. If something sounds too good to be true, it probably is. If you’re asked for money but the reason why isn’t clear, or the numbers don’t add up, consider it a red flag. Keep a sharp ear out for any doublespeak, and don’t be afraid to ask questions, no matter how confident the other person may seem, how good the offer sounds, or how simple the deal appears. Be especially leery if someone offers you something for free but requires you to give them all of your information, including your address and credit card number.

Be especially aware of any pop-ups you click on.

Keep Good Records

Another financial practice that will help you is to keep excellent records of the money that comes in or out, including where it comes from and where it goes. An added benefit of keeping good records is that you can examine them over the course of several months and identify any patterns that may not be serving you well.

These records can also serve as proof that you made a payment or can specify amounts you’ve received, whether payments were made in full or in part, and the form of payment. In a world with ever-increasing options for ways to part with your money, it’s good to have a visual representation for you,  and trusted family members to look at, to make sure you’re not being taken advantage of.

Social Security

On the legal side of easy ways to part with your money, there’s Social Security. Starting several years before retirement, you should plan and consider carefully when you want to start receiving benefits. Many people start too early and end up missing out.

In the Handbook of Consumer Finance, they recommended that seniors wait until seventy years of age to receive social security benefits (1). Your case may be different, so run the numbers and talk to your accountant. Make a careful decision about when you will start receiving your Social Security benefits in order to receive the highest amount possible, in a way that works for you.

If you make a solid budget and stick to it, watch out for scammers, and plan for your future, you will have a much better financial outcome, virtually free from surprises and relatively immune from shady characters.

 

Reference

DeVaney, S. (2008). Financial Issues of Older Adults. In Xiao, J. (Ed.), Handbook of Consumer Finance (pp. 209-221). New York, New York: Springer.

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