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How to protect yourself from financial fraud

No matter your age, it's good to know how to protect your financial accounts. As you get closer to retiring, you may need to tap into them, whether they're set up specifically for funding retirement or used for other purposes, such as a liquid savings or money market account.

At the same time, you may not necessarily keep up with the latest technologies and related scams that target older Americans. It's important to stay vigilant when it comes to protecting your finances, whether you are a pre-retiree, semi-retired or fully retired.

Older consumers who reported losing money due to fraud had much higher individual losses than younger Americans. In fact, the median loss by age group rises with age: $600 for the 60-69 age group, $769 for the 70-79 group, and $1,700 for the 80 and over group, according to a Federal Trade Commission report. Of course, there are incidents of fraud that don't result in a financial loss, but they can still be a huge headache to straighten out. For example, a fraudulent checking account withdrawal may ultimately be resolved, but that amount may be unavailable to you while an investigation takes place.

The good news is just a few proactive habits can help you safeguard your finances and your identity.

Monitor your banking and credit accounts regularly. 

Keeping tabs on your accounts can help you detect any cases of potential fraud as soon as it happens so you can start to mitigate any damage that could happen. If you bank online regularly, you're more apt to see something that doesn't look right. You can use your bank’s mobile app periodically, as well as set up warning notifications to receive a text when a suspicious transaction occurs. If you see something odd, call the bank or creditor right away.

Correspond safely with any institutions you work with.

Anytime you need to contact your bank or creditor, it’s smart to start with the main hotline on the back of your credit card or bank statement. You can also initiate a chat or send an email, but just make sure if you google the company’s site (by searching for your bank's name, for example) that you choose the correct one since fraudsters can sometimes create phony pages that look almost like the real ones, called phishing. Look for “https” at the beginning of the web address – the “s” signifies that it’s secure. There might be other signs like minor misspellings that could indicate you're not on the real site.

In addition, most financial institutions have a secure login system, often with two-factor authentication, which is when you must receive a text or email code in order to complete your login. Take advantage of this added layer of security. Once you're logged in, you can conduct transactions without having to worry about sharing sensitive information over the phone or email.

Learn how to spot a phone/email scam.

If someone claiming to be your electric company, your bank, the IRS or a charity calls or emails you to ask you for a money order or credit card number to clear a debt or make a donation, chances are it’s a scam. Other common calls you may get are for “guaranteed lower rates,” or “extended warranties” on your car. In fact, of all the reported fraud among older consumers, phone scams were by far the biggest culprits – 190,000 occurrences in 2018 versus 30,000 for email and online scams combined, according to the FTC. Be mindful of new scams going around by checking out the FTC’s Scam Alert page.

Pull your credit reports.

Checking your three credit reports on a regular basis, at least once per year via annualcreditreport.com, will help ensure that warning signs of fraud or identity theft don't go unnoticed. These may include an account on your report that you never opened. A quick review will confirm that your accounts are accurate and up to date. In addition, see if any of your banks or creditors provide you with your free credit score, or sign up for a free service. Any sudden fluctuations in score can be another indicator that something is going on.

Mind your mail. 

Throwing away whole bills or credit offers is an invitation to an ID thief to get your personal information. Shred anything that has account numbers or financial information. Along those lines, try requesting paperless billing and statements to cut down on the actual mail that you get. Also, don’t leave mail lying around if you have people in your home doing work or cleaning. And if you travel, put a stop on your mail or have someone trusted pick it up for you so that statements/offers don't end up in the wrong hands.

Get your affairs in order.

Taking care of legal matters regarding your finances and discussing future plans with adult children is always a smart move so that if anything should happen, your plans and wishes are in writing. 

Just as you keep tabs on your health as you get older, you should make financial checkups part of your regular routine as well. Preventative and proactive measures can keep your finances safe and secure.

For more information about internet safety best practices, preventing fraud and identity theft, online and mobile security and much more, review the AIG Retirement Services Security Center at https://www.aigrs.com/aig-security-center.