Over Sixty Spring 2022 Digital

15 YOURMONEY OVERSIXTY.COM.AU | ISSUE 2 | 2022 CHRISTMAS GIFT IDEAS Gifts for Kids Christmas Food Scan here to browse our Gift collection online Personalised Gifts www.innovations.com.au 1300 303 303 have an average net wealth of $1 million, up some 40 per cent in the past 12 years. During the same period, younger generations have made few financial gains. So as Australians live longer, they are in- creasingly responsible for more and more wealth, while in many cases, their children and other younger close friends are strug- gling to get a start or make ends meet. In addition, analysts point to the emer- gence of ‘inheritance impatience’. This is a situationwhere a child assumes their parents don’t really need their money, and that they may as well take it now, rather than wait to inherit it later. Inheritance impatience can create a flash- point in two key situations. The first is where a family member is given an enduring power of attorney over a relative’s financial affairs. While most people handle this responsi- bility with care and honesty, the rise in relat- ed court cases shows it is an area where older Australians are at risk. So much so, there is a push to create a national registry to identify what are currently state governed powers of attorney. The second area of risk is where a child, having themselves suffered financial diffi- culties resulting from unemployment, di- vorce or gambling, decides to move in and live in the same house as mum and dad. The close living arrangements make it rel- atively easy for a dependent to take financial advantage of the situation and it can be al- most impossible for a parent to act to force Protecting against financial elder abuse PATRICIA HOWARD YOUR MONEY E lder abuse is set to rise as the Australian population ages and as new, more dam- aging forms of elder abuse emerge – such as digital abuse, where older Australians are specifically targeted via online and tele- phone scams. As many as 14 per cent of older Australians will fall victim to some form of elder abuse, be it financial, psychological, physical, sexu- al or social abuse, according to the Australian Institute of Family Studies. However, the reality is no one is safe, par- ticularly from financial abuse, with several trends combining to create a perfect storm where even active and mentally alert older Australians can easily become victims. To beginwith, Australians are living longer, healthier lives. In the last 100 years, the life expectancy of Australians has increased by 20 years. Australia has some 3,700 people aged 100 or older. By 2050, this number will climb to 50,000. Older Australians are also getting rich- er, at a much faster rate than younger Aus- tralians. According to the Grattan Institute, households headed by someone aged 65-74 their child out of their family home once they have moved back in. So severe is this risk, that estate planning specialist Australian Unity estimates 90 per cent of financial abusers of the elderly – who wrongly gain access to bank accounts, in- vestments, the family home or other real es- tate – are family members. The fact that most perpetrators of elder abuse are close loved ones makes it particu- larly hard to stop. However, there are five simple steps you can take to guard against elder abuse. Never discuss your financial situation in detail, particularly with family members It is tempting when you transition into re- tirement to tell family members exactly how much money you have in super for example, but don’t. It opens a door that can be impossible to close. It is enough to say you think if you’re careful with your money that you will be able to have a pleasant retirement. There is no need to disclose actual dollar amounts. As soon as you do, there will be a family member doing the maths and deciding you don’t need all that money, no matter how much it is, and that they should be given a slice of it and sooner rather than later. Be extremely careful about who you make your enduring power of attorney This is a very powerful document, and it effectively passes all control of your assets to a third party. Continued on page 16 Older people need to be aware of the possibility of financial exploitation and how to safeguard against it Photo: Patricia Howard YOUR MONEY Our financial expert explains how to safeguard against the rising cases of misuse of assets About the author  Patricia Howard, author of The No- Regrets Guide to Retirement: How to live well, invest wisely and make your money last (Wiley), is a licenced Australian financial adviser. She has a Commerce Degree, holds an Australian Financial Services Licence and recently passed the FASEA Financial Adviser exam. Visit her at www.patriciahoward.com.au