According to the U.S. Census Bureau, the nation had more than 9.3 million veterans aged 65 and older in 2013. For most of us, Veterans Day means a time to thank all our former servicemembers. But it’s a sad truth that scammers operate out of greed, not gratitude. Not-so-honest people target older veterans and their families to cheat them out of their hard-earned benefits.
In one type of scam, unscrupulous advisers claim to offer free help with paperwork for pension claims. But these attorneys, financial planners, and insurance agents persuade veterans over 65 to make decisions about their pensions without giving them the whole truth about the long-term consequences. They tell veterans to transfer their assets to a trust – or to invest in insurance products – so they can qualify for Aid and Attendance benefits. What they don’t say? The transaction could cause the veterans to lose eligibility for Medicaid services or the use of their money for a long time.
For veterans experiencing cash flow trouble, there’s a different pitfall. Some companies offer an advance on your pension to get you the funds you need fast. You sign over your monthly pension checks for, say, five or 10 years, in exchange for a lump sum payment of a lesser amount. Pension advances aren’t a cheap way to get cash; fees can be high. And what’s more, the company often requires retirees to buy a life insurance policy – with the pension advance company named as the beneficiary – to make sure that the repayments continue.
If there are veterans in your life, fill them in about these scams. Encourage them to pass it on to their friends, family, and community to help more veterans dodge a bad deal.
