Financial Health Checkup

Senior Financial Health Checkup: 6 Easy Steps

Updated on Nov 02 2018


May marks the anniversary of the 2017 Equifax data breach where 145 million consumers had their identification exposed to hackers. In remembrance of this event, it’s important to protect yourself from identity theft and fraud — especially if you’re a senior — as seniors are most vulnerable.

How to Protect Yourself From Identity Theft and Fraud

Elderly scams are the most common form of fraud. Sadly, scam artists relentlessly prey on seniors because they can be easy targets:

  • They can be gullible to phishing and digital predators
  • They often live alone
  • They do not always have someone watching over their finances regularly

Seniors are often vulnerable to cons and scammers for many reasons, including not regularly monitoring their finances, impaired judgment from cognitive impairment, and more.

Being aware of your finanial picture and potential scams can help you protect you and your family from falling victim to fraud so you can be spared not only heartache, but also financial duress.

Getting a financial advisor’s help to monitor finances is a great option to stay updated on your financial activity and prevent scams from happening. Read below for other ways to stay ‘financially healthy.’

Monitoring Personal Credit and Account Activity

Follow these six easy steps to monitor your personal financial health. You can get started on your own, but just like a physical health checkup, it’s important to consider getting a professional’s insight when it comes to your finances, too.

1. Check Your Credit Report.

If you are married, both spouses should review their reports. There are three main credit reporting agencies that hold your credit history: TransUnion, Experian and Equifax. Federal law entitles you to a free report annually from each agency and you can obtain your reports, which does not impact your rating, by visiting www.annualcreditreport.com. Once you bring up the report, do the following:

  • Read each report and identify any information that doesn’t seem accurate.
  • Clean up your report by closing accounts you no longer intend to use.
  • Check joint accounts for consistency between the two of you.

You can report any inconsistencies or errors on your reports to the credit agencies directly.

2. Get Organized by Taking a Financial Inventory.

What assets do you own and where are they all located? From stocks and bond accounts to homes and vehicles, make a list of every asset. Once you have your list, spend time reviewing the items, and consider consolidating investments and other accounts if they are scattered around to multiple institutions. Consult your financial advisor before consolidating assets, as there might be tax consequences.

Keep in mind that having fewer account statements to review will simplify your financial life and lay the foundation for you and your advisor to implement a unified strategy.

Account for your debt, as well. The review of your credit report should aid you in this part of the financial inventory task. Once you have an overview of both your assets and debts, you’ll be able to determine your overall net worth.

3. Review Your Account Transactions.

To genuinely understand your inflows and outflows of money, it’s helpful to categorize them into three buckets:

  • Income – wages, investment income, etc.
  • Expenses – necessary items like utilities, real estate taxes, groceries, etc.
  • Luxury items – restaurant tabs, travel for pleasure, special clothing items, entertainment, etc.

Some credit card companies provide a year-end statement that summarizes annual purchases by category for you, coming in very handy for this task. It’s important to review every account you have to understand where your money is going. This can help you get organized so you can more effectively monitor your spending habits, whether it’s mandatory spending or luxury spending. Reviewing your last filed tax return is a good starting place for characterizing sources of income as well.

4. Prepare for the Future (and for Scams).

Are you prepared for retirement with specific financial goals in mind? If you have a savings plan in place, make sure you are still on track to reach the goal for your specific investment time horizon. If you don’t have a plan, begin developing one and discuss it with your financial advisor to cover emergency costs, healthcare or the loss of a job.

If you keep regular tabs on your finances you’ll know if anything goes awry. Here are common elderly scams to be aware of, though:

  • Charity Scams
  • Counterfeit Prescription Medicines
  • Email Scams
  • Fraudulent Anti-Aging Products
  • Investment Schemes
  • Medicare Card and Medicaid Card ID Theft Scam
  • Repair Fraud
  • Sweepstakes and Lottery Scams
  • Cemetery, Cremation and Funeral Scams

Check-in with your financial advisor if you have any questions about your credit, finances or suspect you may be a victim of any of the above scams or something related.

5. Prepare for Retirement.

Financial security doesn’t happen overnight and most Americans don’t want to work forever. Diligent retirement planning, goal commitment and conscientious saving are all contributors when it comes to saving the ‘right’ amount of funds for retirement.

Learn the top ways to save for retirement and lean on the skills of your professional advisors to help you get the retirement investment portfolio you need to set you up for retirement success.

A will is a legal document that directs what should be done with your financial assets when you pass. Getting your will and estate documents ready are critical to being prepared if should something happen to you. Consult a professional on what documents you need so that you and your family are prepared for this part of life. Here are a few things to consider:

  • Will and Living Trusts
  • Health Care Directive
  • Durable Power of Attorney
  • Estate Planning

Senior Financial Health Helps Determine Your Quality of Life

It’s important to spend quality time on each financial check-up step so you don’t overlook anything. Tackle them one at a time, at your own pace. The key is to complete them all. Once you have gone through your first full financial health check-up, future check-ups should be easier so that you can achieve personal financial health.

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