The American Association of Retired Persons (AARP) is warning it’s members to beware of scammers who are trying to put money in their own pockets while scamming our loved ones out of thousands of dollars. These “investment” schemes are often based around one simple premise, “everyone is doing it.”
The AARP says that this is one of the many tactics that scammers are using to entice the elderly, who are often aging in place and on their own, to make “investments” that are simply scams. The trick goes that the scammers prey on those who are already more vulnerable to this type of peer pressure tactic. Often scammers are targeting people are faith who are prone to following others in their groups and may be susceptible to this feeling of FOMO or fear of missing out that one gets when they find out that people they already know and love are investing in something similar.
How can you avoid falling into this trap?
The first thing you should do is to always ask yourself if you are considering an investment because others you know have also invested or if it is in your best interest. In this way too, it is important for you to know that others you are friendly with are actually investing in something or if you are just being fed a line that they are. Do your own due diligence.
If you are a caretaker of someone who is aging in place you will want to monitor their investments closely. While you don’t always need to be in their financial business it can be helpful to talk about potential investments with them and ask them if they need help understanding a particular investment. If they answer yes, then you have a green light to do a deep dive into a particular offering to make sure that it is a legitimate investment opportunity. While you may not be able to stop your loved one from making a mistake you can give them your best advice and explain to them your reasoning before they “follow the back.”
The “everyone is doing it” line that some scammers are using with many people is an age old tactic but is becoming more and more prevalent. The best and most effective way to measure whether an investment is right for you or a loved one is to only look at it through the prism of your own financial interests and nobody else’s.