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Retirement Planning > Spending in Retirement > Income Planning

Editorial comment: What to do about financial abuse of elders?

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This month’s issue of Income Planning carries some disturbing news. It’s about what is being called “elder financial abuse” by family members, caregivers and others. (See the article here.)

Retirement income planers need to stay abreast of this problem, and be part of the solution. After all, they often have access to the financial information of elder clients. They are therefore in a position to spot problems–and hopefully to intervene. They are also in a position to be blamed for problems, especially if they do not keep detailed records and observe the highest standards of client care.

The article presents highlights of a new report on the topic. Called Broken trust: elders, family and finances, it was released in March 2009 by the MetLife Mature Market Institute, Westport, Conn., the National Committee for the Prevention of Elder Abuse, Washington, D.C., and the Center for Gerontology at Virginia Polytechnic Institute and State University, Blacksburg, Va.

The report recounts chilling examples of the financial exploitation of elders. It also discusses the telltale signs of this abuse plus information on abuser profiles and suggested ways to prevent it.

This type of abuse involves “the illegal taking, misuse, or concealment of funds, property, or assets of a vulnerable elder at risk for harm by another due to changes in physical functioning, mental functioning, or both,” the report says, citing a definition used by the National Center on Elder Abuse.

Family members and caregivers are the culprits in 55% of cases, the report says, but it also points out that investment fraud scams occur too and, when they do, the financial losses are higher.

The purpose here is not to recount all the report findings. (You can see them yourself by clicking here.)

Rather, I’d like to use this space to open up discussion with Income Planning readers about elder financial abuse. For instance, in your opinion, how extensive is the problem? What steps can income planners take to keep it from happening to their own clients? What steps can the income planning industry take to trigger systemic changes that will help curb the problem?

It’s important to discuss such questions because the abuse directly affects the success of the income plan to say nothing of the elders’ financial safety. Advisors also have a personal stake in the issue, in terms of exposure to professional legal liability challenges.

This is no small matter.

Please blog your thoughts below or send your comments in a letter to the editor.

[ To comment on this topic, write to the editor. ]

-Linda Koco, Managing Editor, Products and Managing Editor, e-Publications
National Underwriter Life & Health


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