Combining Forces to Combat Elder Financial Victimization How Consumers Can Avoid the Financial Pitfalls of Cognitive Aging and What They Should Be Asking Their Financial Institutions

Abstract

Medical research has linked financial vulnerability to accelerated cognitive aging — the process by which cognitive abilities decline with age. Consumers who understand the risks of cognitive aging and what their financial institutions are doing to detect and deter financial crimes are better positioned to safeguard their retirement savings. In this paper, we examine how consumers and financial institutions can prepare for the financial pitfalls of aging. We present seven important steps that consumers aged 50 or older can take to protect themselves. We also provide consumers with a list of six questions to determine how well their financial institutions are prepared to detect signs of diminished financial capacity, elder fraud, and financial abuse, and to prevent financial losses from occurring.

Keywords: elder fraud, financial exploitation, retirement planning

JEL Classification: D18, G21, G28, J14, K22