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Perspective | Beware of scammers who say it’s the government calling
By Michelle Singletary Michelle Singletary Personal finance columnist
Impostor scams bilked nearly $488 million from consumers in 2018. (ziimmytws/Bigstock)
All our lives we are told to protect our Social Security number. So, naturally, if someone calls to say your number has been compromised, you become concerned.
The call sounds official. You are told your Social Security number will be suspended immediately. Imagine the fear if you’re retired and relying on your monthly Social Security check.
“We have received suspicious trails of information in your name,” the automated message says. “The moment you receive this message, I need you to get back to me on my department division toll-free number. If I don’t hear a call from you, we will have to issue an arrest warrant under your name and get you arrested.”
The Federal Trade Commission said that for the first time, the type of impostor scam in which crooks pretend to represent a government agency has topped its list of consumer complaints. Such schemes represented about half of the 535,417 impostor scams reported last year, it said.
And the overall losses were huge: Impostor scams bilked nearly $488 million from consumers in 2018.
In one version of a government impostor scam, the caller or recorded message claims the person’s Social Security number has been blocked because it has been linked to a crime involving drugs or sending money out of the country illegally, the FTC said. To reactivate the number or get a new one, victims are told they have to pay a fee.
In another version of the scam, people are told that their Social Security number was fraudulently used to apply for credit cards. They are then threatened with a loss of benefits if they don’t pay up.
The scammer’s goal is usually to get people to reveal their Social Security number, pay a sum of cash or both.
“If you get a call out of the blue from someone claiming to be from a government agency like the Social Security Administration or IRS asking you for personal information or money, it’s a scam,” said Andrew Smith, director of the FTC’s Bureau of Consumer Protection.
Should you ever get such a call, keep the following in mind, the FTC said.
∗ Your Social Security number can’t be suspended.
∗ No one from the government will ever ask you to pay money to “reactivate” your number or obtain a new one.
∗ Scammers can make the number displayed on your caller ID appear to be a legitimate government number. Never call the number they give you.
∗ No, you don’t have to verify your Social Security number. If it were the Social Security Administration calling, they would already have it in their database. As scary as the call may seem, never give your number to anyone who contacts you.
∗ Don’t confirm the last four digits of your Social Security number, which can be used in some cases to commit identity fraud.
∗ Never give out your bank account or credit card number.
Also be on guard for someone asking you to pay with a gift card; that is most definitely a scam.
Have you received one of these impostor scam calls? Did you fall victim to such a scam? Send your comments to email@example.com. Please include your name, city and state. In the subject line put “Impostor Scams.”
Retirement rants and raves
I’m interested in your experiences or concerns about retirement or aging. What do you like about retirement? What came as a surprise?
If you haven’t retired yet, what concerns you financially?
You can rant or rave. This space is yours. It’s a chance for you to express what’s on your mind. Send your comments to firstname.lastname@example.org. Please include your name, city and state. In the subject line put “Retirement Rants and Raves.”
Last week, I wrote about wealthy retirees who were having trouble spending the money they saved. So I asked: Are you reluctant to spend your retirement funds not because you’re anxious about running out of money but because it’s hard to make the switch from saving to spending?
George Halasi of Toronto wrote, “Should you take that cruise or safari? Ask yourself: “if not now, when?”
Joyce Ford of Bellevue, Wash., wrote, “I recommend that retirees take the cruises and trips to Europe while in their 60s, which I was fortunate to do. Hiking cobblestone streets in Tuscany at 65 is much easier than trying to do it after total hip replacement or with bad knees. I am now 77 and I am so pleased that I got all my major sightseeing travel out of the way earlier. The 70s hit me with three surgeries and worsening of knee arthritis, so I am now pleased to walk around a grocery store. Do not wait, people, you may not have another chance.”
Nancy O’Connor of Cape Coral wrote, “My husband and I always lived frugally, as had our parents. When I retired we sold our small house at a profit, bought another small house in Florida essentially for the same amount, and continued to live frugally, just out of habit. What we did do was start eating out a little more often, and started planning one or two trips to Europe every year. We really couldn’t have wished for anything more. After five years of that [my husband] passed away. I have to say we enjoyed those years as much as we possibly could have imagined, while making only the smallest dent in our savings. [After retiring] the ‘wiring’ was still set to saving, but we just flipped the switch to ‘splurge’ once in a while rather than try to radically change our lifestyle.”
“Now that I’m retired, I try to remember a lesson my parents inadvertently taught me,” wrote Rachel H. of Maryland. “My siblings and I each received a modest inheritance from my parents. But, geez! I wish they’d spent more on themselves! I wish they’d taken that train trip through the Canadian Rockies, eaten out more often, bought a car that didn’t have any rust. They were old enough to remember the Great Depression and just didn’t feel as secure as they were. I’ve been a saver, too, but I plan to enjoy modest pleasures while my health is still good.”
“I’m writing this email from Fiji, where my wife and I are spending five leisurely days on our long journey home to New Jersey after having spent 23 days touring Australia and New Zealand,” wrote Mark Tatz. “I just retired at year’s end from 36 years practicing anesthesia. Fortunately I was able to save a nice sum of $ but felt anxious as I realized that nice check wouldn’t be coming in anymore. But then I started thinking about not having any time constraints and being able to go anywhere at anytime. It would be a real shame if you finally have the time to do whatever you want but are unable because your health precludes it or the unexpected happens.”
Here’s the story of a couple who are wealthy and enjoying their money.
The husband was a scientist at NIH for 42 years. He’s got two pensions and money saved in Thrift Savings Plan. The wife ran a communications company before selling it. It was the way they saved and budgeted during their working years that has helped them spend well in retirement.
“For 20 years prior to retirement, we didn't carry any credit card debt,” wrote M.B. from Maryland. “We also managed to pay off our mortgage early, so we were completely debt-free seven or eight years prior to retirement. With my husband's pensions, a modest investment portfolio and Social Security, I felt our retirement might not be lavish but would be secure. Then we got rich, at least by our standards. I received an all-cash offer from one of my clients to buy the company. We set aside some of the money to build a vacation home, set up 529 plans for the grandkids, and increase our charitable giving. We found a great Certified Financial Planner to help invest the rest of the proceeds.”
The couple retired in 2012 at 59 and 68. They’ve got a retirement income of about $165,000 a year and a $7 million investment portfolio, which included a hefty inheritance.
“After retirement, I found myself reluctant to spend down our investments and was pretty frugal for the first few years,” the wife wrote. “Our certified financial planner helped us by doing the things you advise in your column: having us prepare a budget each year and updating and reviewing our net worth statement every six months. She also prepares and updates projections of what our financial status will be over the next 30 years based on a conservative average of 3 percent growth, even though our actual growth so far has been greater than that. This has helped us to see that we won't run out of money in our lifetimes.”
She went on to write: “Our certified financial planner also reminds us that most wealthy people spend more at the beginning of retirement, when they are healthy enough to travel, etc., and then spending declines if you're lucky enough to get really old. So her advice is to keep on top of our budget and net worth, and don't be afraid to live it up a little while we can afford to and are still young enough to enjoy it. My parents' deaths also made my husband and me reconsider retirement spending. I was 65 when I received my share of my parents' estate. I am extremely grateful, but sad that they aren't here to see me enjoy it. I think about how much fun it would have been if they had taken their children and grandchildren on vacation together, or how grateful we would have been if they'd contributed to the grandkids' college expenses. My husband and I now take the kids and grandkids on family vacations, we make generous cash gifts to them at Christmas, and from time to time we help them out “just because.”
And what about the future and possible high medical expenses?
“Because my husband and I were financially responsible before we became wealthy, I trust that we have the discipline to ratchet down our spending if we need to,” the wife wrote. “Knowing this about ourselves has given us permission to loosen up our spending a bit.”
You may not have millions when you retire like this couple but with careful planning you can spend well in your retirement without worries that you’ll outlive your money.
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