Elders are more vulnerable and in need of particular services because they are generally a somewhat invisible portion of our society. Most of the victims of elder abuse are isolated, lonely and pulled apart from the population such that society is not cognizant of their existence. Couple this with the fact that a lot of these people have a house, which even in lower income areas, is still worth a lot of money. Put a predator who needs cash or wants more money – usually a family member – in the elder’s midst and you’ve got a recipe for disaster.
Elder abuse encompasses financial abuse cases (trust mills, annuity scams, reverse mortgages, conservatorship of the estate issues), and physical abuse cases, such as caregiver or nursing home abuse.
Fortunately, there are very good laws at present available to protect seniors. There are penal code sections that allow law enforcement and the district attorney’s office to prosecute crimes against elders and to put the perpetrator in jail and/or obtain restitution for the victims. There are civil statutes that provide monetary compensation for the victims. It used to be that if an elderly victim of abuse died, their legal cause of action would die with them. Now, thankfully, there are civil codes that allow their cause of action to live on so that their estate can pursue an elder abuse case. And with certain types of financial abuse against elders, the law allows plaintiffs to seek treble damages.
If you are thinking about a parent, relative or elderly friend, you need to be careful not to let your family or loved one become isolated. Be aware that scams are out there, particularly telephone scams and criminal reverse mortgages. Also watch out for people that just show up on the doorstep of the senior citizen and/or come in unannounced. Speak to your family member or loved one about not giving out any personal information. If you know of an elder who is considering a reverse mortgage or has attended a trust mill seminar, advise them to get a second opinion, either from a trusted family member or a colleague or a friend. Finally, be very cautious about allowing caregivers to assume too much of a responsibility at an elder’s home outside the scope of what they are there to do. Of particular importance are situations in which a caretaker becomes personally involved, perhaps even romantically involved, with the elder, followed by arranging to be added to bank accounts or deeds as joint tenants.
As a final note to seniors, don’t underestimate the sophistication of a predator. They can go door to door. They can call you on your phone. They can reach you on your computer. Thus, maintain a healthy skepticism.
Elder Abuse is everyone's concern! If you know of a senior whom you suspect is being abused, please take action by anonymously contacting:
Monterey County Adult Protective Services (APS), 713 La Guardia Street, Salinas, California, 93901
Often overlooked by families, adult day care centers offer fabulous, caring services to the frail elderly and dementia sufferers. These centers offer a variety of activities while the family caregivers are free to relax or work without worrying about their elder. There are two categories of centers: Adult Day Social Care provides caring staff, new friends, activities and sometimes community field trips; Adult Day Health Care offers the same, plus medical oversight that may include medications, diabetic monitoring, physical therapy, podiatry and more. There are payment differences between social day care and adult day health care. The social day programs receive private pay clients only and does not receive Medi-Cal benefits. Medi-Cal benefits are accepted for adult day health services. Rather than worrying over leaving your frail elder alone at home all day, call the Adult Day Services Network to find out what is available and also to learn more about other services that might be beneficial.
There is one aspect of reverse mortgages that brokers of this product often don't tell seniors: if you don't need the money available through a reverse mortgage immediately, hold off on applying for a loan and instead shop among lenders to compare the FHA, Fannie Mae and Financial Freedom plans. You can choose to receive a lump sum, lifetime income, credit line, or any combination of payments. A popular choice is the line of credit as it makes funds available when you them in the future. However, be aware that the upfront loan fees you incur will start accruing interest as soon as your loan is completed whether or not you use any funds or not.
The income annuity may be a product whose time has come as more baby boomers face retirement that could last 30 years or so. Yet retirees are often victims of over-aggressive financial advisors who push inappropriate annuities on unsuspecting clients. Annuities can offer a fine replacement to the fast-disappearing company pension: guaranteed monthly income for life. But annuity products are incredibly complex, and the industry has had more than its fair share of bad actors trying to collect fat commissions selling certain annuities that are inappropriate for many retirees. So be careful. In general, don’t buy a lifetime annuity if ill health means you’re likely to live a shorter-than-average lifespan. In addition, if you already have a traditional pension, you may not need a string of monthly payments from an income annuity since the pension already provides these.
The type of annuity in which you hand over a lump sum to an insurer and immediately start getting monthly checks for life is known as an “income annuity” or “immediate annuity”. For certain people heading into retirement, that monthly check can be a good thing. The trouble is that these income annuities are far outsold by products called “deferred” (and often, “variable”) annuities, which may suit long-term savers but not retirees who might need the money sooner rather than later.
How can you tell which annuity is which? If you don’t know what type you’re being pitched, chances are it’s a deferred variable annuity – a product for accumulating tax-deferred assets – an not an immediate or income annuity. Many deferred products charge a hefty fee if you pull your money out in the first seven years or so. Older people who buy them often don’t realize this. And annual expenses with these products can be so high that the tax advantages don’t outweigh them for many years. Although deferred annuities do offer the option to “annuitize” – that is, to take your lump sum and turn it into a guaranteed income stream – few investors take advantage of that feature.
Immediate annuities are not right for everybody, but they may have more of a place in people’s portfolio because they protect people against the chance that they’ll live longer than they are technically expected to and consequently protect people from outliving their financial resources. Exactly how much you’ll get will vary depending on your age and the lump sum you invest. To get a general idea, go to the online calculator found at www.calc.tsp.gov/annuityCalculators/annuity.cfm (this calculator is designed for federal government employees but can be generally applicable to others)
Retirees should carefully consider whether to purchase an annuity, shop around and take their time. Carefully check out the company that’s promising to make payments 30 years or more down the line by looking up how it’s rated by independent ratings firms such as Standard & Poors, Moody’s Investors Service and A.M. Best. Also, given all the new product features, ask lots of questions. If you still don’t understand, hire a trusted financial advisor (one who isn’t selling annuities) to explain the products to your satisfaction.