Retirement savings across the United States are increasingly being lost to fraud, not market downturns.
In 2024, U.S. consumers reported losing more than $12.5 billion to fraud, a 25% increase from the previous year, according to the Federal Trade Commission. Adults 60 and older reported $2.4 billion in losses, four times the amount reported in 2020.
The FTC says the real number is likely much higher because many victims never report scams.
Vanguard is warning investors that protecting retirement savings now requires paying closer attention to how scams operate and who criminals are targeting. The firm says retirees are often approached through sophisticated schemes designed to build trust over time before money is transferred.
Rather than focusing only on account security, Vanguard says families should also watch for behavioral warning signs in older relatives. Many scams involve prolonged phone or online contact that isolates victims from family and friends.
Fraud losses are rising fastest among older Americans
Data from the FBI’s Internet Crime Complaint Center (IC3) shows fraud losses reached $16.6 billion in 2024, a 33% increase from 2023.
Older Americans are experiencing the most severe losses. Individuals 60 and older reported losing $4.9 billion, with the average reported loss per victim reaching $83,000.
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Investment scams were the costliest category, responsible for $5.7 billion in reported losses across all age groups. These schemes often involve fake trading platforms, cryptocurrency investments, or fraudulent brokerage accounts that build trust over weeks or months before victims are persuaded to transfer large sums.
Impersonation scams are also escalating. Criminals posing as representatives of the IRS, Social Security Administration, or major financial institutions stole roughly $700 million from adults over 60 in 2024, more than five times the amount reported in 2020.
For retirees, these losses often represent decades of savings with limited opportunity to rebuild.
Behavioral warning signs that may signal financial exploitation
Vanguard says fraud prevention often depends on recognizing behavioral changes before funds are transferred.
Many scams involve sustained communication that pressures victims into secrecy or urgent financial decisions. Because the manipulation happens gradually, changes in routine may be one of the earliest warning signs.
According to Vanguard, families should watch for patterns such as the following.
- Frequent cash withdrawals from multiple bank branches
- Repeated gift card purchases at convenience stores or gas stations
- Transfers to unfamiliar financial institutions or overseas accounts
- Purchasing gold bars or depositing cash into cryptocurrency ATMs
- Becoming unusually unavailable or secretive during phone calls
- Mentioning a new contact known only through phone or online communication
- Displaying anxiety about finances paired with vague explanations
In many cases, scammers maintain constant contact with victims, discouraging them from discussing the situation with relatives or financial institutions.
How families can intervene when fraud warning signs appear
Vanguard says conversations about potential fraud must be handled carefully to avoid pushing victims further into isolation.
Accusations or confrontational language can cause individuals to defend the scammer rather than reconsider the situation. Instead, the firm recommends approaching the conversation with neutral observations and questions.
Here are some effective approaches.
- Start with observations rather than accusations. For example: “I noticed you’ve been visiting the bank frequently. Is everything okay?”
- Ask questions and listen before drawing conclusions. Understanding the situation helps identify whether manipulation is occurring.
- Focus on protection rather than blame. Fraud schemes are designed to exploit trust and emotional pressure.
- Involve additional trusted voices when necessary. Hearing the same concern from multiple family members may help victims reassess the situation.
The goal is to reopen communication and break the isolation that scammers often create.
These safeguards can prevent fraud before money is lost
Once funds are transferred, recovery is often extremely difficult. Fraud payments frequently move through international accounts or cryptocurrency networks within hours.
Vanguard recommends several protective measures to reduce the risk of financial exploitation.
- Designate a trusted contact on financial accounts. Brokerages and banks can notify a trusted person if suspicious activity occurs without granting that person control over the account.
- Establish a durable power of attorney. This allows a designated individual to assist with financial decisions if someone becomes incapacitated or is being manipulated.
- Activate transaction alerts. Text or email notifications for withdrawals and transfers can help families detect unusual activity quickly.
- Create a verification agreement within the family. Agree in advance that unexpected requests for money or personal information will be verified with a trusted person before any action is taken.
- Never move money to “protect” it. Requests to transfer funds to a new account for security reasons are a common fraud tactic used by criminals impersonating banks or government agencies.
Why fraud schemes succeed, even with experienced investors
Financial fraud increasingly relies on psychological manipulation rather than technical hacking.
Criminals frequently exploit trust, urgency, and authority to pressure victims into acting quickly. Vanguard highlights several patterns commonly used in scams.
- Caller ID spoofing, where criminals appear to be calling from legitimate bank numbers.
- Manufactured urgency, such as claims that accounts will be frozen unless immediate action is taken.
- Requests for secrecy, encouraging victims not to inform family members or institutions.
- Payment requests through gift cards or cryptocurrency, which legitimate organizations never require.
Older victims are also less likely to report scams. But when losses are reported, they tend to be significantly larger.
Fraud losses are accelerating as scams become more sophisticated
FTC Consumer Sentinel data show cyber-enabled fraud losses rising from $3.5 billion in 2020 to $12.8 billion in 2024.
Investment scams have expanded, driven in part by social media promotion and increasingly realistic online trading platforms. FBI data also shows the use of cryptocurrency in fraud payments increased 250% between 2023 and 2024.
Regulators have begun responding. The FTC updated the Telemarketing Sales Rule in 2024, and several states are considering measures requiring banks and telecommunications companies to implement scam-prevention systems.
However, enforcement efforts often lag behind the speed at which fraud schemes evolve. For families with aging relatives, Vanguard says proactive communication and financial safeguards remain the most effective defenses against scams targeting retirement savings.
Related: Protecting America’s Retirement Savers from Scams and Fraud
