Retirement Scams Can Drill a Hole in Your Finances
by Rick Pendykoski
For any person who has been working for the duration of their adult life, the time after retirement is supposed to be the time for pursuing hobbies. However, if you fall prey to a retirement scam, then you are in serious trouble. Therefore, it is necessary to know what you should inquire about and check at the time of acquiring various types of savings and investment plans for retirement.
There are different precautionary measures that can be taken to ensure that you do not fall prey to a retirement scam. Some of these measures are:
Proper Writing Material: Different financial institutions will claim various types of benefits and advantages on their retirement plans. Although these plans might sound highly beneficial to you, you need to get everything in writing. If the company says that they will provide you all the documentation after you take the plan, then refusing and rejecting their plan would be the right decision. It is always better to get all the necessary details about a plan in writing before you agree to take it.
Stay Clear of Pressure: Any financial company, which pressurizes you to give an affirmative to a plan they are offering, could be fraudulent in nature. In general, every company should give you some time to think about the whole deal. No investment opportunity in the market will vanish in a span of a couple of days. Therefore, it is better to steer clear of these types of investment opportunities.
Returns Prediction: When searching for retirement plans, you will find that there are many companies, which will promise you a certain amount of returns. However, the fact is that no financial organization can guarantee the returns you will get on your investment. Every investment done in the market is dependent on the market trends and risks. The returns will be higher if the market goes up and the opposite will happen if the market goes down. Therefore, this is also one type of a trapping device employed by fraudulent financial institutions.
Safeguard Your ID Details: One of the biggest investment frauds that can happen is the theft of identity proofs. Be aware of the fact that a legitimate financial organization will never ask for bank details like account number or card details. They will also not allow you to disclose your social security number. Therefore, if someone is asking for these details, then he unquestionably has something else in his mind. It is imperative that you stay away from these kinds of people and organizations.
Individual Agents: There would be many people in the financial market who work independently. Although it is not necessary that all independent agents are fraudulent in nature, however, there is no harm in being a little careful. It is better to research and check their authenticity before going for such plans. If you are unsure of the investment options provided by them, it is better to stick to plans offered by your own company or any other known financial giant.
Unrealistic Sales Pitch: You will find that there are many organizations who would say that you will earn the same after retirement as you are doing right now. Honestly, it is just a hoax sales pitch. There is no way a retiree can earn as much as he/she did when working until and unless you opt for some extra work. Investments will only offer you a limited supply of money. Every time you make a withdrawal, you will be charged taxes on the withdrawal. The only way you can reap profits on your investments is by reinvesting them. Therefore, any company claiming this type of sales pitch should be always avoided.
Your financial decisions should be taken in a rational and thoughtful manner, both when you are working and after retirement. It is better to be careful than to be sorry.
Rick Pendykoski is the owner of Self Directed Retirement Plans LLC, a retirement planning firm based in Goodyear, AZ. He regularly writes for blogs at MoneyForLunch, Biggerpocket, SocialMediaToday, NuWireInvestor & his own blog for Self Directed Retirement Plans. He writes about topics related to retirement planning, investing, and securing future. To learn more email Rick Pendykoski firstname.lastname@example.org or visit his blog www.rickpendykoski.com