- Use “third-party” custodians. There are VERY few instances where a financial adviser should hold your assets. VERY few. Make sure that your money is with a different financial institution (Fidelity, Charles Schwab, TradePMR, Scottrade, etc.) where you can log on and see your money at all times. If Bernie Madoff was required to do this instead of holding the money himself, you would likely never have learned his name.
- Appoint a trusted “watchdog”. It is a fact of life – as we get older, our cognitive abilities begin to decline. Criminals take advantage of this by targeting senior citizens with fear tactics and “guarantees”. If you can, get a trusted family member or friend involved as a sounding board or even attending meetings with your adviser. I welcome situations like this – it can help people feel even more secure with recommendations knowing they have another trusted opinion involved.
- Avoid product pitches. Why are we required to get a doctor’s prescription before buying powerful medicines? Because it helps prevent abuse of the product and it signifies that in the doctor’s professional opinion it is appropriate for you. In the same way, be wary of anyone trying to sell you a financial “medicine” without first closely examining your financial situation.
If you take these steps, you greatly reduce the risk of an unscrupulous con artist separating you from your financial reserves. I’m happy to offer a second opinion on any products or suggestions you have questions about!
For more information, check out these resources: