57 percent of older Americans say having a conversation about later-life needs is a low priority (even among those 80+), and a third have never discussed it with family
Embarking on the seemingly “golden years” of life, older Americans have
identified a pain point — talking about potential challenges or needs as
they age.
According to the 2018 Wells Fargo Elder Needs Survey, older Americans
are not yet talking with their families about their later years and the
kind of help they may need, nor are they talking about their plans for
healthcare, their estate, and other basic plans for aging. Lack of
urgency is the biggest barrier to conversation, and both older Americans
and their adult children say the conversation is difficult. While
recognizing the prevalence of exploitation and scams targeting seniors,
few older Americans believe they will fall victim, and key protections
are not yet in place.
“Some older adults may struggle to see the need to plan for issues they
may face as a result of aging. They spend a lifetime preparing for
retirement, but then fail to plan to see themselves through
retirement,” said Ron Long, head of Regulatory Affairs and Elder Client
Initiatives at Wells Fargo Advisors. “This unwillingness to plan and
have hard conversations about aging is increasing senior vulnerability
and leaving gaps in protection.”
The 2018 Wells Fargo Elder Needs Survey represents a national sample of
784 older Americans (ages 60+, with at least $25,000 in investable
assets) and a similar survey of 798 adult children (ages 45 to 59, with
at least $25,000 in investable assets) who communicate with a parent
regularly. The survey was conducted between Feb. 26 and March 15, 2018.
Aging and money are difficult to talk about
Older Americans may be posing a threat to their nest egg by shying away
from conversations about aging. More than one-third of older Americans
who are parents say it is difficult to talk with their children about
challenges they will face in later years, including one in four (24
percent) who say it is difficult to talk about money and finances. Adult
children find such conversations even more difficult, with one in three
(34 percent) saying money and finances are difficult to discuss.
The biggest reason most parents and children are not yet talking,
however, is that they see no urgency, especially among parents (even
among those age 80+). More than half of older parents (57 percent) say
having a conversation about later-life needs is a low priority, and a
third have never discussed it with family. Adult children are equally
unwilling to have these conversations because it is either a low
priority (32 percent) or would cause conflict (23 percent).
Even so, four out of five adult children say they want their parents to
plan more so that they do not have to intervene. This contrasts to the
35 percent of older Americans who say that too much planning gets in the
way of enjoying life.
People who plan are happier
Older Americans who have talked with their families about later-life
needs and have estate and planning documents in place are happier. In
looking at eight planning behaviors measured in the survey, 40 percent
of those who have done between six and eight of the activities describe
themselves as very happy; this contrasts to 22 percent of those who have
done none of the activities or just one or two.
“While planning for old age isn’t a topic individuals particularly
enjoy, it often provides greater confidence and comfort in knowing that
they’ve prepared for potential later-life needs,” Long said. “That
confidence translates into greater happiness because it’s one less thing
they, or their children, need to worry about.”
Gaps in planning and protection
Despite the positive potential impact of planning, many older Americans
do not have important estate and health documents in place. While
three-quarters of older Americans (74 percent) report having a written
will, many fewer report having other legal and financial documents:
-
60 percent have an advance healthcare directive.
-
59 percent have a power of attorney for healthcare.
-
48 percent have a power of attorney for financial matters.
Having documents in place does not necessarily mean they are current.
One in six report their documents are out of date.
Scams and financial abuse: “It won’t happen to me”
Older Americans are targeted for scams, often because they have
accumulated significant wealth or they are vulnerable because of
isolation and/or cognitive or physical decline. And while older
Americans recognize the prevalence of elder exploitation and scams, few
say they believe they will fall victim themselves; as a result, key
protections are not in place.
Nearly all older Americans (98 percent) say that older people are
susceptible to scams, as do 98 percent of adult children. But only one
in ten say they are susceptible to scams, and only one in four (24
percent) worry about it. Self-assurance is a driving factor of this
sentiment, as four out of five (81 percent) of older Americans say they
are confident they will not be scammed out of their money as they get
into their later years.
This assurance is not one-sided. While adult children are far more
likely to say their parents are susceptible to scams (38 percent), three
out of four (75 percent) also say they are confident that their parents
will not fall victim.
Of even greater concern is the misunderstanding of who targets seniors.
Although nearly half of older Americans (48 percent) say there are
family members they would not trust with their money, 68 percent say
strangers are the most likely perpetrator of financial exploitation,
followed by hired help (24 percent). Fewer than one in ten (9 percent)
say that family members are the most likely perpetrators, despite family
members being among the most common perpetrators1.
“Unlike strangers, family members don’t have to gain access and
establish a relationship with the victim; they are already positioned to
exploit,” said Kez Wold, associate commissioner for Adult Protective
Services in Texas. “Also, family members may rationalize the
exploitation, or may feel entitled to the money. And if a family member
is the perpetrator, the victim is certainly less likely to report or
pursue the issue.”
Even among seniors who are aware of potential financial abuse, the
majority of older Americans do not have protective measures in place to
guard against potential threats:
-
11 percent have alerts of large transactions sent to others.
-
11 percent keep their checks or credit cards locked away.
-
About a third (30 percent) say they have a “trusted contact” on file
with their financial institution for protection against financial
scams or exploitation.
-
Just over a third (35 percent) do not check their credit report
annually.
-
Two-thirds sign documents without having others review them first.
-
Fewer than half (46 percent) use automatic bill pay so others are not
writing checks.
Helping protect seniors
As concerns about elder financial abuse and exploitation rise, Wells
Fargo is among the financial services companies working to prevent and
stop the crime before it takes root. All Wells Fargo team members who
interact with customers take annual training on how to prevent and
report suspected elder financial abuse. Wells Fargo also offers a senior
curriculum in Hands on Banking®, a financial education
program offered free of charge across the U.S., and has begun a public
awareness effort to encourage individuals to take steps to protect
themselves.
View the Wells
Fargo Elder Financial Abuse Protection Guide for more information.
Along with the company-wide actions noted above, in 2014 Wells Fargo
Advisors created a dedicated Elder Client Initiatives team — a unit
devoted to taking action when a financial advisor or other team member
suspects a customer is the victim of financial abuse and which has
advocated extensively for state statutory changes that enhance elder
protection.
Prevention as a defense
There are a number of actions individuals can take to protect themselves
from elder financial abuse and exploitation:
-
Talk with trustworthy family members about your financial plans.
-
Update and have legal documents in place, such as wills, an advance
healthcare directive, and powers of attorney for financial matters and
for health care.
-
Put in place protections such as signing up for direct deposit, annual
credit report checks, automatic bill pay, automatic alerts of large
transactions sent to a trustworthy individual, and keeping checks and
credit cards locked away.
-
Avoid isolation through social activities.
“Putting safeguards in place and engaging in a transparent, open
dialogue will be critical in protecting the dollars older Americans have
worked hard to accumulate,” Long said. “In some cases, their livelihood
may depend on it.”
1 National Adult Protective Services Association, 2018
About Wells Fargo
Wells Fargo & Company (NYSE: WFC) is a diversified, community-based
financial services company with $1.9 trillion in assets. Wells Fargo’s
vision is to satisfy our customers’ financial needs and help them
succeed financially. Founded in 1852 and headquartered in San Francisco,
Wells Fargo provides banking, investments, mortgage, and consumer and
commercial finance through 8,200 locations, 13,000 ATMs, the internet
(wellsfargo.com) and mobile banking, and has offices in 42 countries and
territories to support customers who conduct business in the global
economy. With approximately 265,000 team members, Wells Fargo serves one
in three households in the United States. Wells Fargo & Company was
ranked No. 25 on Fortune’s 2017 rankings of America’s largest
corporations. News, insights and perspectives from Wells Fargo are also
available at Wells
Fargo Stories.
About Wells Fargo Advisors
With $1.66 trillion in client assets as of March 31, 2018, Wells Fargo
Advisors provides investment advice and guidance to clients through
14,399 full-service financial advisors and referrals from 4,525 licensed
bankers. This vast network of advisors, one of the nation’s largest,
serves investors through locations in all 50 states and the District of
Columbia. Wells Fargo Advisors is the trade name used by Wells Fargo
Clearing Services LLC and Wells Fargo Advisors Financial Network, LLC,
Members SIPC, separate registered broker-dealers and non-bank affiliates
of Wells Fargo & Company. All data includes Wells Fargo Clearing
Services, LLC and Wells Fargo Advisors Financial Network, LLC, as of
March 31, 2017.www.wellsfargoadvisors.com
About the Study
Versta Research conducted a national survey for Wells Fargo of 784 older
Americans (ages 60+, with at least $25,000 in investable assets) and a
similar survey of 798 adult children (ages 45 to 59, with at least
$25,000 in investable assets) who communicate with a parent regularly.
The two groups were sampled independently, each stratified by age,
gender, race, ethnicity, region, and assets to ensure samples that
reflect the full U.S. population of each group. The survey was conducted
between February 26 and March 15, 2018.
About Versta Research
Versta Research is a full-service market research firm, headquartered in
Chicago, IL, specializing in customized strategic market research and
public opinion polling.
