How can I make money work for me and my family as we age?

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Transcript:

[Michael Liersch:] Hey, humans, I’m Michael Liersch and this is the About Money Podcast, presented by Wells Fargo. I’m a behavioral scientist with a PhD in cognitive psychology, who loves openly discussing money to help humans better understand their money behaviors. By understanding our money behaviors, we all have the opportunity to make better money decisions.

This season we’re going to talk about jobs money can do for us. Jobs? You might ask. Yes, money does many jobs for us, such as helping us with our family, lifestyle, the community, aging, travel, investing, and more. We have a great lineup of guests for you, so let’s get into it.

In this episode, we’re going to speak with Ron Long, head of Aging Client Services at Wells Fargo. You may be asking yourself, “Well, what does that mean?”

Well, Ron spent the first part of his career working with the government at the Securities and Exchange Commission, otherwise known as the SEC, as a fraud and insider trading attorney. After various roles at the SEC, he translated that experience into ultimately leading a team of people at Wells Fargo, who help humans each and every day stay empowered and safe when it comes to their money, especially as they age. The team does this in collaboration with both government regulators, and Wells Fargo.

I’m so thrilled to speak with Ron because he can help us answer the question that we’re asking in this episode: How can I make money work for me and my family as we age?

To answer this question, we’re going to address why we don’t discuss money and aging as much as we should, what the consequences are of not having those conversations, and how we can take action to have those dialogues and better protect ourselves and our families today.

Ron, welcome to the Wells Fargo About Money Podcast.

[Ron:] Thanks, Michael. I’m very happy to be here, and looking forward to our conversation today.

[Michael:] So let’s get right into it. Ron, can you give us some data points around why it’s so important to be cognizant of issues related to money and aging?

[Ron:] Sure. And I won’t try to geek out too much here. But let’s look at three basic points. The first is that when we age, we have the money. That’s a good thing. Sixty percent of the wealth in this country is in the hands of those of us over 65. So very good.

But second point, the bad guys know this. Almost $36 billion are lost every year to fraud by folks targeting those of us 65 and older.

[Michael:] Wow.

[Ron:] Then the final point, which is the sad one, but much like in baseball, where we lose our fastball, in life we lose our fastball, and that shows up most in our management of our finances.

So as we move along, doing all the great things, having saved all of this money, the official word is cognitive decline starts to set in and just makes us more vulnerable to the bad guys. Maybe some of us have that bad family member who takes advantage, or the neighbor. So those are the three reasons why I think the money and aging issue is such an important topic.

[Michael:] So that’s interesting, Ron. You talk about the fastball, and not really having that anymore. Cognitive decline is a part of a lot of people’s lives as they age.

And I know for many of us, and this includes myself, Ron, I’ve had family members undergo cognitive decline. And to your point, it is a huge struggle, especially around money.

So given this prevalence, why do you think the idea of aging, money, and all the surrounding concerns you’ve highlighted, why is it still such a taboo topic for individuals, for couples, families, friends.

Like why do we not talk about it, Ron, honestly?

[Ron:] Sure, and I’ve heard a couple of people say that it probably was easier to talk about the birds and the bees than to talk about money.

[Michael:] I’ve heard that too, Ron.

[Ron:] And I think it’s true for a lot of them. But for some of us as adult kids, we just think if we bring the topic up, it’ll create friction. We’d rather go along to get along. So many of us simply pass the topic by.

For a number of our older folks, the conversation is an uncomfortable one, because it’s just one more signal that that inevitable end is on its way, and why do I now have to engage on this topic?

And then finally, some are not so trusting that if I start talking to you about the money, and maybe you see a little more. And I mentioned earlier that cognitive decline, maybe Ron or Michael comes in and says, “Mom, you can’t stay on your own anymore. I’ve seen what’s going on with your money. Move in with me, move into the rest home,” whatever it might be.

And rather than have that conversation take place, we simply keep silent and put the topic off.

[Michael:] Oh, I see, so that the idea is by talking about it, it might actually reveal that it’s happening to me, and then I might lose control. So it’s that traditional idea that I’ll get the keys taken away from me. I won’t be able to drive anymore. I won’t have independence, which you and I both know, is such a human idea to have independence, to feel free.

So given that, and given that the idea or the premise is well, let’s be silent about it, because then maybe I can prolong the process and not have to lose that independence as soon as I may lose it if I talk about it, how do we flip the frame there?

Because what concerns me, Ron, about that, is as a behavioral scientist is really the opposite is true. If we continue the dialogue, or we have it in the first place, perhaps we can get ahead of those things that are happening.

And in fact, if we have those conversations before something like cognitive decline occurs, or someone is taken advantage of, we can go into a preventative mode and all work together to actually keep financial freedom, independence longer than it might have occurred, than if we remain silent.

[Ron:] No, exactly, Michael, I think you hit the nail on the head. In finance, we have what we call business continuity planning, realizing an earthquake or flood may happen. We should be talking about family continuity planning. Death, disability, dementia may happen, but the family has to go on.

So I think with that concept, approaching our older folks with the thought that how do we continue the family where we know certain things are inevitable, that may ease the conversation.

Another way to do it is to just say, point out the comment, “I heard Mr. Jones passed away and left a huge mess.” You can substitute Prince, you can substitute Sonny Bono, Abraham Lincoln apparently died without a will, so there are real-world examples of what happens when you don’t do the planning.

And then the important part is, it’s not a one-and-done conversation. You don’t sit in a corner on the day after Mother’s Day and get it all done. So it needs to be ongoing. It needs to be comfortable. And you need to make sure you’re listening to the parent, the grandparent and understanding some of the concerns you raised earlier about independence and being able to have life on my own terms.

[Michael:] I love that idea. That last idea, in particular of normalizing money conversations is what the podcast is all about, Ron. So I think that’s great, just have money conversations early and often with your family members, and make it something that becomes a part of your life rather than a moment in time.

So when it comes to this idea of people who may be listening, who haven’t necessarily done a lot of that preparation, but they have concerns, I wanted you to highlight since you’re such an expert in this field, what are the most common forms of fraud that you see when it comes to aging clients? And can you tell us a bit of the why behind it, so that maybe people can relate to it?

[Ron:] Sure. So one of the key ones is the Romance Scam. You have folks who had long, loving relationships and their partner dies. Now, they think they can renew that, and online, there’s the person that’s saying all the right things, making all the right comments, and you’re in love online, never seen them in person. And then the request for a little bit of money to help me out of a tight spot

Who doesn’t give the person they love, who loves them, has expressed love, money? But that sort of fishhook gets into you, and then money, and we’ve seen it unfortunately thousands of dollars later, you finally realize that that’s not the love of your life.

The other one is the Grandparent Scam. And again, preying on the love of the grandparent for the grandchild. You get the desperate call. They don’t even sound like your grandchild, but they say they were in an accident, their nose was hurt or what have you, and we need money right now.

And “oh, Grandma, only you can do it. Please don’t tell mom or dad, they would be so disappointed in me.” What grandparent doesn’t want to be that person that they can’t step in to help their grandchild out?

[Michael:] You’re giving me chills, Ron, by the way. These give me chills because both of them do– it’s not really even about cognitive decline. It’s they’re preying on human emotion and family connection, to make that happen. And also loneliness, potentially in isolation. But please keep going. What are some other ones?

[Ron:] Yeah, and the other points you raised there, the loneliness and the isolation are key factors in the sense that the Grandparent Scam can’t work if the daughter or son is actually visiting mom frequently such that, “What do you mean, Billy called you and spoke? Let me talk to Billy.” So I mean, you can see how you can blow it apart pretty quickly, when you’re in touch more often

The final one is we all want to be lawful, and it’s the Government Scam. You have not paid your IRS taxes, or you’ve missed a jury duty court date. Marshals or government agents will be at your door, if you don’t immediately send us the money to wipe this out. We’ll let you do it fast, just send us gift cards. That way, you don’t have to do any extra work.

And so these are three scams, we have more, but they’re all variations on this, taking advantage of where these folks sit in loneliness, in isolation, in loving relationships even where they’re trying to use their love to help. And it turns out that their love is actually being used against them to hurt and deplete their finances.

[Michael:] And that last one is particularly interesting, because you can imagine that never being spoken about, especially if someone’s afraid they’re forgetting to pay for things or may have lost track of that and not wanting to lose independence either.

And we actually had a close family member that that exact scam happened to, Ron. So it’s interesting how this touches many of our lives. And so tell us, how can we take immediate action?

[Ron:] Yeah, I have a couple of ideas, and you can mix and match some of these. The first is the concept of a family password. If you can imagine that you get the call. It’s your grandson.

“Oh, Billy, that sounds terrible. What’s the password?”

If we could just get that muscle memory every time, and that sends bad guys away from you and off to try and find some other person who hasn’t planned with a family password. So that’s one thought.

[Michael:] I just wrote that down, Ron, by the way. I’m doing that right after this.

[Ron:] You can see it works in any number of scenarios-

[Michael:] — Totally, I can totally see it. It’s perfect.

[Ron:] And the second is, and this is more in the financial realm, but you should have a trusted contact listed on your brokerage account. It’s an option, you don’t have to do it. But we think it’s essential.

Particularly if it’s simply falling in the lobby when you went to visit your FA or more importantly your financial advisor seeing a trend that looks troubling. And being able to call that daughter in Dallas, or that son in Seattle, and say, “I don’t need you to know all the finances, but some things are happening with your dad. Maybe you can fly back to St. Louis, and check in on him.”

So we think the trusted contact is another planning vehicle, easy to do. Folks should do that.

And then the final one, takes a little bit of work, but the journey of 1000 miles starts with the first step. Let’s inventory the key information. Where is the money? What is the money we have, where that is, but more importantly, what are the obligations I owe on a regular basis?

So that should we come across the potential Government Scam, “Wait a minute, Dad, you told me these are the things you pay. You are never behind in your taxes. That’s not an issue.”

So we need to line that up. And that could be for anything. It could be a sudden visit to the hospital that we weren’t expecting. Any number of things could come into play.

Now there are a number of other things we all want to do, the legal documents, power of attorney, will or trust, medical directive. All of that can be done, but if we did those first three, I think those are things that are easy to do, easy to start with. And then to your point earlier, lets us continue the conversation. It’s ongoing; we build from here.

[Michael:] That’s so powerful, Ron, because I do think a lot of people when they think about planning or contingency planning, especially around these ideas, they think about the will, the estate plan, power of attorney. And there can be a lot of inertia around that, Ron, and I love these quick ideas that even start the conversation, I do want to ask you a really direct question.

If someone needs help now, where should they turn first?

So let’s say someone’s listening to this episode, and they say, “Oh, my gosh, based on what I’m hearing, or, you know, I already suspected this, which is why I’m listening to this episode. Something’s happening to me or a family member of mine.”

Where should they go first in your mind, Ron?

[Ron:] So strange as it may sound, but many times your financial professional if you have one, that’s the place to start. Because remember, that’s where the bad guys are headed as well

Let them know you got a phone call, claiming to be your grandson. Let them know that you were talking to this gentleman online, and it turns out now that maybe the romance wasn’t all, all you thought it was.

That way you can at least start getting information. And many professionals then can help to that next step. Do we go to Adult Protective Services? Do we bring in law enforcement? In some cases, you want to call 911 in an immediate situation, but seeking that sort of help.

And if you don’t have a financial professional, who is the trusted person in your life?

There were seven of us growing up, not all of us would have been the trusted one. But maybe it’s the fourth kid in line, or the oldest, whatever. But let’s always be willing to have someone you can go to open up about the true facts. Let’s not pull punches. Let’s not worry. And hopefully that’s the person that can listen to you. And then take the next steps without your fear that Ron’s immediately going to move me into Safety Rest Resting Home, and that’s the last I’ll see of anything.

[Michael:] So with that in mind, Ron, maybe if people don’t take any action from what they’re listening to today, maybe one thing that they can do for sure, is just think about and write down the human beings that they trust, that they would trust in that moment.

And maybe they can write down why, Ron, and really evaluate it. So that Ron, you can build that trust relationship with somebody, ideally, to your point, a professional or someone who you know would be your advocate in these moments.

And perhaps it is a close family member or friend that you can trust. But really think about writing that information down. Who can you trust? Why? And really keep track of that list, Ron, so in these moments, you’d know who to go to.

One final question. And this is really personal, Ron. I know we are going through ideas around money, aging, how we think about ourselves, our family members, protecting ourselves, getting ahead of it, but I want to know why you’re so passionate about this topic. What is it that makes you want to do this and keep families and clients safe and secure every day?

[Ron:] Well, a lot of it, like many of these things, is personal. I have a mom who will be 97 next month, she has a number of issues, and she’s in a home where they can help and treat those. But that thought that as she ages were someone to try and take advantage of her financially, just drives me crazy.

And then in our job, unfortunately, in our day job, we get the calls from financial advisors who actually see what happens, the damage that occurs when their client who is perfectly fine in their 40s and 50s, either through dementia or diminished capacity, or outright scams gets defrauded.

And now, having prepared for that later life has a lesser chance of having the finances carry them through because they fell victim to scams. So if we can stop this early, get awareness out there, for both the professionals, the families, the children of these older folks, we think that is going to make a dent, and drive the bad guys into figuring out something else, to some other place to go, and to stay away from our trusted older family members.

[Michael:] Ron, I really thank you for sharing that. And I love how you make it personal in your own family. And I can tell the love and respect that you have for those older family members. And it’s really a beautiful thing.

So, Ron, so grateful for you and everything that you’ve shared with us today. Thank you for being here. I appreciate it.

[Ron:] Thanks for this opportunity. I appreciate it, Michael.

[Michael:] Wow! As you can tell, we are very lucky to have Ron Long as an advocate for our aging clients at Wells Fargo, and as a voice across the United States to help those in need.

Ron, thank you for sharing your wisdom and making it so personal with us today. We’re truly humbled and grateful for all that you do.

 

That’s it for this episode of the About Money Podcast. Please email us with the topics that you would like us to address at AboutMoney@WellsFargo.com. And if you really liked the episode, share it with family, friends, and anyone who listens to podcasts.

About Money is produced by Wells Fargo. You can learn more about ways to work with us at WellsFargo.com forward slash About Money. I’m Michael Liersch, asking you to talk about money today.

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