Total Counsel Law Group

Why Don’t Millennials Like the Stock Market?

“When it comes to investing their money, millennials aren’t turning to the stock market.”

A new Bankrate article asked more than 1,000 Americans what they consider the best way to invest money they won’t need for 10 or more years. Real estate was the most popular response. This answer was given by 31% of respondents.

For young people, this preference is especially true. Among millennials (those ages 23 to 38), 36% responded that real estate is the best long-term investment option. Zero-risk cash investments, such as high-yield savings accounts or CDs, was second with 18% of respondents, and the stock market was third, with 16% of respondents.

CNBC reports in its recent article “Millennials agree on the best way to invest—but they’re wrong” that not only do millennials have the biggest preference for real estate of any generation, they’re also the least likely to invest money into stocks. This group has never been attracted to the stock market despite the 10-year long bull market. One reason may be because they favor more concrete investments, and their preference for real estate shows the desire many ultimately have for homeownership. The tangible nature of real estate gives them more comfort than what may seem more abstract, such as stock ownership via mutual funds and ETFs.

However, real estate isn’t always the best or simplest way to build wealth, especially for those who just own single-family homes.

While there are lots of reasons to buy a home, it’s no replacement for a retirement fund.  It is usually a terrible investment.

Home ownership has many expenses, such as property taxes, maintenance and homeowner’s insurance. Although a home may increase in value over time, it probably won’t appreciate enough to offset all the money spent on expenses over the years.

An investor can generally assume that, over the long term, funds invested in a low-cost diversified index fund will realize a roughly 7% annualized return.

Even with the ups and downs in the market, stocks are typically a reliable long-term investment. The S&P 500 earns an average annual return of about 10%. Adjusted for inflation, this is still an annual return of 7% to 8%. In addition, investing in the market doesn’t have to be complicated. A simple way to get going, is by contributing to a tax-advantaged retirement account, like an employer-sponsored 401(k) plan, Roth IRA or traditional IRA.

Whatever path you choose, it’s critical to begin saving and investing as much as you can, as early as you can. The more time your money has to grow, the better the result.

Reference: CNBC (July 18, 21019) “Millennials agree on the best way to invest—but they’re wrong”

How Do You Fight Financial Elder Abuse?

“Being a celebrity has to be the best gig in the world, right? It comes with money, property, prestige, constant attention and a gang of admirers. However, as the recent news stories about the late legendary Marvel comic book creator Stan Lee and ‘60s psychedelic artist Peter Max show, older celebrities can be just as prone and vulnerable to elder abuse as others.”

Next Avenue’s recent story, “Stan Lee and Peter Max: What to Learn From Their Elder Abuse Cases” notes that the Lee and Max stories have some striking similarities: both seniors look to have been taken advantage of by people close to them. Lee’s former business partner and caretaker Keya Morgan was arrested for elder abuse, false imprisonment and grand theft of an elder dependent adult.

The New York Times recently published a chilling story that Max’s estranged son Adam virtually kidnapped him, as he increasingly became incapacitated. Max’s second wife Mary had to fight for the right to bring him back home. However, Adam alleged that she tried to hire a hit man to damage the artist’s painting hand, and household employees accused her of neglecting her husband. Mary Max died of what is thought to have been suicide in New York City in June.

In recent years, the article said that Max was alleged to have been exploited by his family and associates, who had him signing canvases that others had painted in his trademark style. These bogus paintings were then sold at auctions, as if they were his original artwork.

Elder abuse occurs to one in 10 adults over 60, according to the National Council on Aging, and 60% of elder abuse is perpetrated by family members. About two-thirds of those perpetrators are adult children or spouses. One of the most common forms of elder abuse is financial elder abuse. That’s the misuse or withholding of an older adult’s resources by another. Here are three preventive measures:

1. Don’t let your parent be isolated. Seniors who are mostly alone can become vulnerable to a “gateway” caregiver. That’s a person claiming to be looking out for the person, but instead they may get a power of attorney and transfer that person’s property and financial assets into his or her own name. Help fight this, by having your parent spend time with friends and family.
2. Help your parent with proper legal documents for her financial assets. This will ensure that the senior’s assets don’t fall into the wrong hands. Ask an estate planning attorney about a will, a living trust and a power of attorney. A power of attorney allows a trusted agent to manage your parent’s finances, if he or she can’t.
3. Increase communication with siblings. Everyone in an older person’s life can be the eyes needed to report abuse at the first hint of a problem. This puts a vulnerable senior on the “radar” for these agencies to follow up on for further issues.

Reference: Next Avenue (June 14, 2019) “Stan Lee and Peter Max: What to Learn From Their Elder Abuse Cases”

What States Rank the Highest for Elder Fraud in Total Losses?

“Georgia is fifth in the country for elder fraud in total losses, an online publication, Comparitech, reported this month.”

The four states that have higher losses than Georgia are California, Florida, Texas, and Arizona. Georgia’s losses in 2018 totaled $1.5 billion, according to The Augusta (GA) Chronicle’s recent article, “$1.5 billion lost to elder fraud in Georgia last year.”

The article reports that these types of cases have seen an uptick over the past several years, but Georgia hasn’t seen one type of elder fraud that occurs more often than others.

“We have it a good bit,” said Jefferson County Chief Deputy Col. Tim Moore. “We work multiple cases where people have been defrauded. It’s an ever-changing threat.”

Common scams that defraud the elderly include phone calls where the scammer says that he is a law enforcement officer, a representative of the IRS or another agency, or of a business such as a utility company.

Law enforcement provides advice for the public:

• No one should give out any personal information, such as Social Security numbers, bank account numbers, or credit card information. Don’t make payments or make any agreements over the phone.
• Officials also warn that if the caller disconnects in the middle of the conversation, don’t call back because they will charge you for the call.
• Remember that state and federal agencies won’t call and threaten citizens with a warrant over the phone.

In addition, if you get a suspicious email, don’t open its attachments and don’t click on any links that may be in the email. You should contact the agency whose name appears as the sender and verify that is who actually sent the email.

Comparitech explains that the vast majority of elder fraud cases in the U.S. go unreported, and they estimate five million cases of elder fraud occur in the country annually, resulting in $27.4 billion in losses.

Reference: Augusta (GA) Chronicle (May 20, 2019) “$1.5 billion lost to elder fraud in Georgia last year”

Stan Lee’s Former Manager Arrested on Elder Abuse Charges

“Stan Lee is sadly gone but the Marvel icon is far from forgotten, especially in the L.A. County District Attorney’s office.”

District Attorney of Los Angeles County Jackie Lacey has leveled elder abuse charges against Stan Lee’s former business manager, Keya Morgan.

MSN’s recent article, “Stan Lee’s Ex-Manager Hit With Elder Abuse Charges; Arrest Warrant Issued” reports that Morgan is facing one felony count of false imprisonment of an elder adult, three felony counts of theft, embezzlement, and forgery or fraud against an elder adult, as well as the initial elder abuse misdemeanor count.

Morgan took control of Lee’s business affairs and personal life in February 2018. Lee, the creator of Spiderman, the Black Panther, and other comic book heroes, had assets of more than $50 million in the last years of his life. Lee passed away on November 12, 2018. Morgan is said to have isolated his client from family and friends. Morgan also embezzled or misappropriated $5 million of assets, according to documents filed in Los Angeles Superior Court in 2018.

The five counts of elder abuse filed on May 10 could put Morgan in prison for 10 years, if he’s found guilty.

The public first learned of the troublesome relationship between Morgan and Lee last summer, when the then 95-year old Marvel comic book legend sought a restraining order against his ex-aide over elder abuse. The request was made just three days after Lee put out a June 10, 2018 video on social media insisting that he and Morgan were working “together and are conquering the world side-by-side.”

Because of the video and the elder abuse filing, Lee’s financial advisor was arrested by the Los Angeles Police Department on suspicion of filing a false police report, allegedly concerning a supposed break-in incident at Lee’s residence.

A three-year restraining order against Morgan was granted by a county judge last August. He was found guilty of the false police report misdemeanor charge in April 2019 and was ordered to stay away from Lee’s family and residence among other conditions.

After years of making cameos in all the Marvel blockbuster movies, Lee’s last appearance was in the record smashing Avengers: Endgame, which was released last month.

Reference: MSN (May 15, 2019) “Stan Lee’s Ex-Manager Hit With Elder Abuse Charges; Arrest Warrant Issued”

What Can I Expect for Healthcare Costs in Retirement?

“The nation's health expenditure growth is anticipated to average 5.5 percent annually from 2017 through 2026, compared with 4.6 percent through 2028 for Medicare's per-capita spending.”

Although it’s expensive, the good news about retirees' health-care costs is that they aren't rising as fast as they were even a few years ago.

CNBC’s recent article, “Health-care costs for retirees climb to $285,000,” says that a healthy male-female couple retiring at age 65 in 2019 can expect to spend $285,000 on health-care expenses in retirement, according to Fidelity Investments' annual analysis. When looked at by gender, the estimate is $150,000 for women and $135,000 for men.

The amount is up a bit from $280,000 in 2018. Although the annual increase slowed over the last two years—3.6% compared with 12.2% from 2015 to 2017—the amount still is a challenge for retirees who are mostly unprepared to cover the overall cost of retirement.

Since Medicare is the primary insurer for those 65-and-older, various factors have led to slower increases in older Americans' health-care costs versus those of the general population. The national health expenditure growth is anticipated to average 5.5% annually from 2017 through 2026, but Medicare's per-capita spending is projected to grow at an annual rate of 4.6% through 2028.

Fidelity's analysis assumes that the two theoretical people are eligible for Medicare and includes premiums, copays and other cost-sharing expenses, as well as prescription drug costs. However, there are items that aren’t covered by Medicare, like dental, basic vision, over-the-counter medicines and long-term care. Those costs would be in addition to that $285,000 estimate.

The biggest unknown for retirees is long-term care. This can include assistance for daily living activities, such as eating and dressing. Someone turning 65 has a nearly 70% chance of needing long-term care services in the future, according to government data. There are insurance policies that cover those costs, but the premiums can be expensive. Some life insurance policies may have a rider that covers long-term-care costs.

Pre-retirees should familiarize themselves with Medicare, which isn’t free. Part A (hospital coverage) has no cost, but Part B (outpatient coverage) has an average monthly premium of $135.50 for 2019. For prescription coverage under Part D, the average premium is $32.50 this year.

We should all be saving for retirement as much as we can, and taking advantage of the tax-advantaged accounts at our disposal.

Reference: CNBC (April 2, 2019) “Health-care costs for retirees climb to $285,000”

How Can I Freeze My Child’s Credit?

“A new law requiring credit bureaus to offer you free freezes applies to children, too. It’s easier than you’d expect, but you may still have questions. Here are some answers.”

You can now freeze your child’s credit files for free, and it isn’t that hard to do, says The New York Times’s article, “You Should Freeze Your Child’s Credit. It’s Not Hard. Here’s How.”

Because of a new federal law, free credit freezes are available to everyone. When you have a credit freeze with the major bureaus—Equifax, Experian and TransUnion—most companies can’t access your credit record, unless they’re already conducting business with you.

As a result, a criminal can’t get a credit card in your name because the card company won’t open the account, unless it can review your credit first.

Thieves can find a way to use your kids’ credit files for their own illegal purposes, and because most people don’t watch their children’s credit, thieves have more time to do their work. In addition, children usually don’t have black marks in their credit files yet—an attractive feature for the bad guys.

Many grown-ups aren’t keen about the hassle of having to temporarily thaw their credit files whenever they want to buy a car or take advantage of a sign-up bonus for a new card, however, this isn’t a problem for children. Therefore, their freezes are less problematic.

Look at each credit bureaus’ instructions on its website. The law typically requires companies to collect proof that you are who you say you are and that your child is really your child. This usually entails mailing them copies of some combination of your child’s birth certificate and Social Security card, and your driver’s license and Social Security card.

In a few weeks, you’ll get a letter confirming that the companies have frozen the files. There isn’t an electronic upload available for your documents, but you can fax them in.

Equifax and TransUnion request that you use an address on the envelope that includes the word “freeze” in it: “Equifax Security Freeze” and “TransUnion Protected Consumer Freeze.” However, they’ll still process your request, if you leave “freeze” out of the address.

Reference: The New York Times (December 28, 2018) “You Should Freeze Your Child’s Credit. It’s Not Hard. Here’s How”

Virginia Passes New Law to Thwart Elder Abuse

“New legislation signed by Virginia Governor Ralph Northam will help fight abuse, neglect and exploitation of senior citizens, according to a prosecutor who requested the legislation and 38th District Sen. Ben Chafin (R-Lebanon), who introduced the bill in the Virginia Senate.”

“Elder abuse is a growing epidemic in our Commonwealth, yet these cases are under-reported and remain very difficult to prosecute for various reasons,” says Chuck Slemp III, commonwealth’s attorney for Wise County and the City of Norton.

The Southwest Times’ recent article, “Law boosts tools to fight elder abuse,” reports that Slemp requested the new legislation. This law goes into effect July 1 and will help protect adults age 60 and older and physically or mentally incapacitated adults age 18 and older. The legislation provides a framework for local departments of social service and commonwealth attorneys to create one or separate multidisciplinary teams to review cases at all stages of investigation and prosecution. The teams would be made up of professionals from diverse disciplines. The team goals would be as follows:

• To help identify abused, neglected and exploited individuals;
• To coordinate medical, social and legal services for these people and their families;
• To develop programs to detect and prevent abuse, neglect and exploitation; and
• To promote community awareness of the problem, and educate them on ways to prevent it.

Slemp said that he was thrilled that the bill will become law to give the state additional tools in the effort to fight elder crimes and to establish a framework for a team-approach to review these situations. The Commonwealth’s attorney for Wise County and the City of Norton added that he was grateful to Senator Chafin and 4th District Delegate Todd Pillion (R-Abingdon), who introduced the House version of the legislation.

“Every day the elderly are taken advantage of financially and abused. It is our responsibility in the General Assembly to help protect the most vulnerable of our citizens. Commonwealth Attorneys and law enforcement need all of the tools available to effectively prosecute elder abuse and financial exploitation,” said Chafin. “Multidisciplinary response teams will aid in the prosecution of these crimes and will bring these criminals to justice.”

Pillion added, “With an aging population, particularly in rural areas, it’s critical we form the systems and processes needed to help safeguard people who may find themselves in abusive situations.”

Slemp believes that the new bill will help localities to concentrate additional resources on the “epidemic” of elder abuse.

Reference: The Southwest Times (March 13, 2018) “Law boosts tools to fight elder abuse”

What is Tennessee Doing to Combat Elder Financial Abuse?

“Last week’s actions by legislators—which are just now getting underway—seek to increase the penalty for those who are financially exploiting Tennesseans through telephone and electronic scams.”

The Cleveland (TN) Daily Banner’s recent article, “Elder financial abuse leads recent legislation,” reports that one of the Tennessee 111th General Assembly’s major actions was the elder financial abuse and fraud bill. The new bill would increase the penalty for those financially exploiting Tennesseans through telephone and electronic scams.

House Bill 799 intensifies the state’s focus on crimes against the elderly.

“House Bill 799, as it was introduced, increases the penalty and broadens the offense of financial exploitation of an elderly or vulnerable person to include the use of a telephone or other electronic or communication device,” state representative Dan Howell (R-Georgetown) explained.

The legislation identifies as its target the use of these devices with the intent “… of fraudulently or deceptively obtaining, or attempting to obtain … money, property or anything of value from the victim,” Howell said.

Mark Hall (R-Cleveland), who represents the 24th Legislative District, agreed with Howell’s interpretation and stressed that these types of crimes, or attempted crimes, are being reported statewide.

“According to media reports, law enforcement officials have been warning Tennesseans, especially our elderly and vulnerable adults, about potential scams targeting these groups during tax season,” Hall stressed. “Some of these scam artists will call or email, and pose as an Internal Revenue Service official, asking for sensitive information.”

Howell and Hall cautioned all state residents, “Don’t be fooled by these callers. Ask for a name, title and phone number, but don’t call back. Report any suspicious activity to the proper authorities.”

Tennessee is one of many states now addressing elder abuse legislation.

One of Tennessee’s biggest advocates against these types of crimes is the Tennessee Bankers Association. For the past several years, the TBA has pushed for stronger laws governing the financial abuse of senior citizens.

Reference: Cleveland Daily Banner (February 18, 2019) “Elder financial abuse leads recent legislation”

Virginia Takes Action to Protect the Elderly from Financial Abuse

“I think it’s important for people to pay close attention to elderly folks and how they may be financially exploited. We’re all getting older, there are more of us and we’ve got to watch out for each other.”

A bill with bipartisan support is moving to the Virginia General Assembly. It may help protect elderly residents and other vulnerable adults against financial exploitation, by giving financial institutions more resources to prevent this crime.

Both the state House and Senate have passed versions of SB 1490. However, the two chambers must resolve their differences over the legislation.

“This bill addresses the issue of financial exploitation of older Virginians, which has been on the rise in recent years,” said the sponsor, Senator Mark Obenshain, R-Rockingham.

WHSV reports in the article, “Law would protect elderly against financial crimes,” says that David Toscano is sponsoring HB 1987, the companion bill in the House. His bill was unanimously approved by the House in January and, in a slightly different version, by the Senate Rehabilitation and Social Services Committee more recently.

The proposals would give financial institutions the authority to “refuse to execute a transaction, delay a transaction, or refuse to disburse funds,” if the institutions believe in “good faith” that the “transaction or disbursement may involve, facilitate, result in, or contribute to the financial exploitation of an adult.”

“What we’ve been finding is that sometimes, elderly people are exploited by their caregivers or some relative, by taking them to the bank and removing cash from their accounts. Once the cash is removed, it’s hard to get it back,” Toscano said.

“This gives the lending institution some more teeth to make sure that they’re not giving away the money of folks who are being exploited and can essentially stop it before it happens.”

The bill also would give financial institution personnel protection from civil or criminal liability for refusing to process transactions or for reporting suspicious financial activity, provided the actions are taken with due cause.

“Often the tellers at bank branches are in the last position to identify and stop these crimes, but too often they feel helpless because they cannot stop or delay suspicious transactions,” Obenshain said. “This bill will empower these bank employees to help protect vulnerable older Virginians.”

Financial exploitation of vulnerable adults is a widespread problem. The National Adult Protective Services Association terms vulnerable adults as anyone who is “targeted due to age or disability, isolation, reliance on caregivers, or decreased physical or mental capacity.” The Association claims that 1 in 9 seniors have been “abused, neglected or exploited,” and 1 in 20 cases involves financial exploitation. Roughly 90% of abusers are family members, caregivers, or other individuals in a position of trust.

Reference: WHSV (February 15, 2019) “Law would protect elderly against financial crimes”

What’s the Latest on Florida’s Attempt to Create an Online Notary Law?

“The Florida legislature is considering making it possible for people to have legal documents notarized online.”

The Florida legislature is giving consideration to HB 409, which would make signing official documents, like a will or power of attorney, more convenient. Some have expressed concerns that greater convenience could lead to more fraud, especially for the elderly.

The San Francisco Chronicle reports in the story “Florida may allow legal papers to be notarized online” that the legislation was proposed by Representative Daniel Perez, R-Miami. The bill moved Tuesday through the House transportation and tourism appropriations subcommittee and will be considered next in the Judiciary Committee—the last step before a House vote. However, a Senate version hasn't made as much progress.

Representative Perez remarked that he’d recently traveled to Colombia and realized as he boarded his flight, that he’d failed to assign power of attorney to his in-laws. The requirement that he appear in person before a Florida-commissioned notary made it impossible to fix his oversight, he said.

The notary bill has made it past attempts by two Democrats that would’ve limited its scope. Representative Barbara Watson, D-Miami Gardens, compared the risks of fraud under the system to college students who buy fake IDs to illegally drink alcohol. She proposed requiring notary witnesses to be in the same place physically, as whoever is signing legal documents.

"When we have no one tangibly looking at this information, not having it in their hands for close inspection to verify its validity, we're in trouble," Watson said.

Representative Ben Diamond, D-St. Petersburg, said allowing wills and powers of attorney to be created online was dangerous for Florida's elderly. He said lawmakers need to balance between better business and protecting older residents.

"I have a concern about someone going into a nursing home with an iPad and walking room to room and getting people to click buttons and then they get a couple of powers of attorney," Diamond said.

Perez responded that it was possible for criminals to take advantage of elderly people, even with the current notary requirements.

Attorneys are split. Lawyers from the Florida Bar's Real Property Probate and Trust Law section said the proposal puts the elderly at greater risk of fraud, but those in the Elder Law section said the online services will make it easier for Florida's older population to plan estates.

Reference: San Francisco Chronicle (March 27, 2019) “Florida may allow legal papers to be notarized online”