Five Pathways Featured On Multiple News Sites About Estate Planning Scams

An estate plan is something everyone should have in place to spell out their final wishes, help minimize estate taxes, potentially bypass probate court, and help loved ones and heirs more easily get through a very stressful time.

Pretty much everyone understands this and knows they should have an estate plan, but sometimes estate planning gets put off. In fact, research shows that only 32% of Americans have a will, despite 64% saying it is important.

Enter the predatory scammer.

Recently Nate Towers, CRPC® (Chartered Retirement Planning Counselor), director and retirement counselor at Five Pathways Financial, issued warnings about estate planning scams, and his comments were featured on GOBankingRates, Nasdaq, Yahoo Finance, and AOL.

Living Trust Scams

One of the big estate planning scams that Nate wants you to avoid are so-called living trust mills. “This is where scammers pretend to be estate planning attorneys or financial advisors and offer cheap trust packages,” said Nate. “They usually target seniors, using a lot of pressure to sell these generic, one-size-fits-all trust documents.”

Experts like Nate warn that this is a significant estate planning scam to watch out for, as aggressive scammers can attempt to defraud seniors out of their life savings. 

Even if they are not trying to steal your savings, some scammers use high-pressure sales tactics and pose as “estate planning experts” to foist inappropriate, unnecessary, high-priced, poorly-written estate documents that might not be in your best interests at all.

Nate says you should be skeptical of unsolicited seminars, aggressive sales tactics or offers for “free” estate planning documents that come with hidden costs. And remember, if you feel pressured in any way, immediately end the conversation. Don’t sign any documents you don’t understand, and consult with a trusted attorney to verify the legitimacy of any service or information relayed.

When it comes to estate planning, it’s rarely advisable to use do-it-yourself online forms. But at the same time, you don’t want to overpay. The fees that you pay for estate planning services should be reasonable, and you should get quotes from multiple reputable, licensed professionals. You should be able to get a sense of reasonable and typical hourly or flat fees by doing comparison shopping before hiring anyone.

Heir Locator Scams

Another new scam Nate warns about is the heir locator scam. “This is where scammers claim they’ve found unclaimed assets that belong to you or a relative who passed away and then they charge a hefty fee to help you recover them,” he says.

Towers says these assets usually don’t even exist and that innocent people can be scammed out of thousands of dollars. Nate says that you can spot this scam early if the person asks for money upfront or wants personal information, as these are obvious red flags.

According to AARP, your best bet is to throw out any correspondence that you receive randomly from someone claiming that you’ve inherited any money. And you should never share any financial information with an unverified stranger. 

Bogus Charity Scams

Towers pointed out that one of the worst scams he has encountered is the bogus charity scam. Scammers try to convince people to leave part of their estate to a fake charity or ask for donations for a cause that doesn’t exist. (Obviously, they then steal the money.)

“Be cautious if someone is pressuring you to change your estate plan in favor of a charity, especially if you don’t know much about it,” Nate says. “If you’re unsure, you can check sites like GuideStar or Charity Navigator to see if the charity is legitimate.”

If you’re still unsure about a charity, your best option is to hold off until you can verify its legitimacy. 

If you have questions about estate planning scams, or want help with creating or updating your own estate plan, the retirement counselors at Five Pathways Financial can work as a team with your accounting and legal professionals, or we have experts we can pull in to build an estate planning team for you. Our mission is to help you leave a legacy for your chosen heirs or charities while paying the least amount of tax; and bypassing probate so that your heirs don’t have to wait for months or pay court fees is another goal. Using life insurance as an estate planning tactic can help, and as an independent firm, we have access to dozens of different insurance companies and strategies.

Set up a meeting with us here.

The full original article, “5 Estate Planning Scams to Avoid,” can be found at GOBankingRates. Nasdaq, Yahoo Finance, and AOL also picked up the story.