Think it can't happen to you? Well, think again. Scams and frauds are proliferating all the time, and virtually no one is immune. Many common frauds specifically target senior citizens. In fact, estate planning fraud is one of the more common types of frauds perpetrated on seniors.
So what is estate planning? Simply stated, it's the process of establishing arrangements for the smooth transfer of your property and other financial assets to your heirs. Estate planning typically is designed to minimize the taxes and fees that will be assessed to your heirs.
Proper estate planning will give you the peace of mind of knowing that your assets will be disbursed according to your final wishes. Unfortunately, estate planning has become a growing area of consumer fraud. One area of particular concern is the growing number of salespeople who are make unsolicited calls to seniors and urging them to sign living trusts or new wills. The fact about such documents is that they must be customized to the individual's needs to have any value. That's because what might be a valuable planning tool for one person will be worthless to others. And in some cases, hucksters out there are charging senior citizens thousands of dollars for nothing more than pre-printed legal forms bought at office supply stores. These boilerplate documents simply aren't appropriate for many clients. Worse yet, some of them are legally defective.
When it comes to estate planning, con artists are like sharks circling their prey, promoting their business to trusting seniors with false or deceptive statements, high-pressure sales tactics and outright fraud. Here are some tips that will help you avoid becoming a victim or estate planning fraud:
Research the credentials of the salesperson.
Do your own research, using free resources such as the Internet and the public library as much as possible.
Avoid dealing with anyone who approaches you first or makes a door-to-door or telephone sales pitch. If you need professional estate planning services, seek them out in the phone book or by referral from your Chamber of Commerce, Better Business Bureau, or a trusted friend or family member.
Beware of salespersons who use a hard sell approach and insist that you must act immediately. Instead, take your time when making important financial decisions.
Beware of salespersons who tell tales of devastating financial impacts if you don't act.
Beware of salespersons who discourage you from contacting a lawyer or accountant. Some con artists will assure you that an attorney has reviewed your file and approved it. Don't believe them. Instead, consult with a trusted, reputable, certified estate planning professional before signing anything.
Never respond to an offer that you don't fully understand.
Beware of claims that are too good to be true. For instance, no trust will avoid all income taxes.
Beware of getting suckered into expensive estate planning if your assets don't really justify it.
Be careful about attending estate planning seminars and workshops.
Con artists like to isolate their victims and get them alone. To avoid this tactic, bring an adult child or trusted friend with you when discussing your financial affairs with someone else.
Not all estate planning salespersons are dishonest. But as with all financial transactions, decisions surrounding estate planning are highly personal and should never be made under pressure. The best advice is to be cautious and never act in haste. By doing this, you will avoid heartache and financial loss.