Close Close
Sign In
Newsletters
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards
Podcast Center Video Center Webcasts Resource Center Events
About ThinkAdvisor Contact Us Advertise With Us Asset & Logo Licensing Sitemap Terms of Service Privacy Policy Copyright © 2024 ALM Global, LLC. All Rights Reserved.
ThinkAdvisor

Financial Planning > Behavioral Finance

Seniors May Be More Vulnerable to Financial Abuse Than They Think

By Michael S. Fischer

X
Your article was successfully shared with the contacts you provided.

Personal experience and media reports have made the American public increasingly aware of older people’s vulnerability to both financial and physical abuse.

This awareness has not protected seniors from financial exploitation, in part because of their overconfidence that they can fend it off, according to new research.

A study released Tuesday by Allianz Life finds a vast majority of seniors think they can recognize financial abuse, whereas their younger family members and friends are less confident this is the case.

For purposes of the study, researchers defined elder financial abuse as the unauthorized or improper use of resources of a family member or friend, age 65 and older, for monetary or personal benefit, profit or gain.

Eighty-nine percent of senior respondents said they could recognize financial abuse if it happened to themselves or to a family member or friend; only 1% said they could not.

However, only 78% of younger family or friends of elders, including some who were caretakers, expressed confidence in their own ability to recognize elder financial abuse, and 22% said they could not or were unsure.

Ipsos conducted an online survey on behalf of Allianz in March 2014 of 2,248 respondents, of whom 1,223 were 65 and older, and 1,025 were between 40 and 64. The findings have not previously been released, according to an Allianz spokeswoman.

The discrepancy in perception went further. Eighteen percent of younger respondents worried that an elder family member or friend would become a victim of financial abuse, but only 11% of senior respondents had this concern.

Moreover, 82% of seniors in the study said they had sufficient resources and information to protect themselves from financial abuse. Again, younger respondents were less confident this was the case, with only 58% feeling an elder family member or friend had such resources.

According to the study, 77% of elder respondents considered prevention as their personal responsibility, perhaps explaining their high confidence. But this self-reliance from elders may contribute to uncertainty about the realities of elder financial abuse, Allianz noted in a statement.

For example, 94% of seniors said they would tell someone if they should become a victim of financial abuse.

Younger family and friends were not so sure, with 50% doubting or uncertain the senior victim would say something. Seventy-two percent cited embarrassment as the primary barrier they believed would keep elders from reporting financial abuse.

This reflected actual experiences of their family and friends of abuse victims, the survey found. Fifty-five percent said that the elder victim had not reported abuse, and 16% were unsure.

Thirty-one percent believed their elder family member or friend did not report the abuse because it had come at the hands of a family member whom the elder did not want to get in trouble. Twenty-three percent said they believed the abuse went unreported because of denial from the elder, and 14% felt the elder was too embarrassed or ashamed to say something.

“Although some of the differences in the responses of elders and family members are not huge, these statistics are concerning because they may point to overconfidence on the part of elders to detect and stop financial abuse,” Allianz Life’s president and chief executive Walter White said in the statement.

“With financial abusers becoming increasingly sophisticated, elders should be very cautious about overconfidence. Vigilance and education about the sources of financial abuse can help elders and caregivers take steps to prevent the abuse from occurring.”

Allianz Life said it had partnered with the Better Business Bureau to create the Safeguarding Our Seniors volunteer program, which sends volunteers to community and senior organizations to educate and encourage discussion on the topic.

As well, several major financial services firms have developed training programs on the specific needs of senior investors and built a senior investor protection framework within their organizations.

— Check out How the Big Firms Are Training Their Advisors to Handle Elder Abuse on ThinkAdvisor.

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.