Creating an estate plan is an important step in protecting your loved ones and ensuring that your assets are distributed according to your wishes. Unfortunately, scammers know that people who want to safeguard their estates are often willing to act quickly.
Even a carefully drafted estate plan can be undermined if you fall prey to a fraudulent scheme. Scammers often leverage fear, urgency, and lack of familiarity with the estate planning process. According to a 2023 report from the Federal Bureau of Investigation, victims of financial fraud who were aged 60 or older lost an average of about $34,000 that year to scams.
Being aware of common tactics and warning signs can help you safeguard your finances and your family.
Why Seniors Are Targeted
Older adults are often the focus of estate planning scams because they
- have accumulated significant assets over time;
- may face more complex estate planning decisions;
- may be less familiar with the legal requirements and details of trusts, wills, and powers of attorney; and
- may be less familiar with technology and how it can be used to access personal information.
Scammers capitalize on these factors, exaggerating risks and claiming their service is the only solution. They may insist that avoiding their service will result in large tax consequences, lost inheritance, or financial ruin—even when those threats are irrelevant to your situation.
Common Types of Estate Planning Scams
Estate planning scams take many forms, but the following are some of the most common:
- Trust mills. Nonattorney companies repeatedly sell low-cost, generic trusts. Such trusts usually offer little real protection and may be used to gather personal information or to upsell financial products.
- Fake or unlicensed attorneys. Individuals claiming to provide legal services or be associated with a law firm often create overpriced or unnecessary legal documents.
- Bogus “probate avoidance” or “secret” trusts. Scammers may promise to eliminate probate or create secret trusts that are not legally enforceable.
- Unnecessary investments or insurance. High-commission annuities, life insurance, or “exclusive” financial tools are frequently sold under the guise of improving your estate plan.
- Identity theft schemes. Some scams request sensitive personal information under the pretense of preparing your estate documents.
Red Flags to Watch For
Be cautious if a provider does any of the following:
- Pressures you to act immediately or claims there is no other option
- Guarantees large tax savings, secret benefits, or unusually high returns without reviewing your situation
- Solicits services through unsolicited phone calls, emails, door-to-door visits, or direct mailers
- Cannot verify credentials or is reluctant to provide references or licensing information
- Exploits fear by exaggerating threats of taxes, probate, or lost inheritance
Scammers often prey on emotions, making victims feel anxious or rushed. Remember that a legitimate estate planning attorney will calmly explain your options, allow time for questions, and customize a plan specific to your needs.
Steps to Protect Yourself
- Verify credentials and reputation. Confirm that anyone offering estate planning services is a licensed attorney in your state. Check online reviews, professional directories, and bar association listings.
- Ask questions and demand clarity. You should fully understand what each document does, why it is needed, and any associated costs or commissions.
- Be cautious with additional products. Insurance, annuities, or other financial tools should complement your estate plan, not be its main purpose.
- Avoid unsolicited offers. Be skeptical of anyone contacting you out of the blue about estate planning.
- Report suspicious activity. If you suspect a scam, contact local law enforcement officials or the national fraud hotline at 1-800-876-7060.
Protecting Your Estate Plan
The best defense against scams is working with a qualified, licensed estate planning attorney. Our trusted team members can help you create enforceable documents tailored to your needs, ensuring that your assets are protected and your wishes are honored. Being informed and vigilant is the most effective way to keep your estate plan—and your loved ones—safe. Contact our office today.
Call Santaella Legal Group, serving all of California, at (925) 831-4840, or reach out to us here.