Just last week I got an email from a Nigerian prince who is going to share his billions with me, as soon as I help him get his money into the country. This may be one of the last articles I write as I will be on some beach, somewhere, living the highlife. Before I leave you suckers behind though, here are some ways to spot a scam and protect yourself.
Right away, let’s talk about scammers themselves. Who are they? How do they find you? What is a scam? Well, it doesn’t take much to really qualify as a scam.
That cute little girl down the street with a lemonade stand is a scammer. She is charging $2.00 for a glass lemonade, you and I both know that with her (let’s be honest) watered down lemon juice and sugar her overhead can’t be more than a few cents per glass. She is making a killing, but you don’t suspect she has malicious intent with her high prices because she is innocent and says she is saving up for a new bike. Hopefully, this girl is the real deal (just like my Nigerian prince) but, she is also a perfect example of how scammers can be successful.
Truthfully scammers can be anywhere; online, working at the local car lot, or right next door. If any of your information has recently become public record, you may be easier to find for targeted scams, but the truth of the matter is that in this day and age you can always be found. The best way to defend yourself from a scam is to be able to identify when it is happening. Since there is no reliable way to avoid a scammer, it’s helpful to know how to defend yourself.
- Always verify credentials. People get very comfortable when the person in front of them is well dress or has a fancy title. Don’t fall for what may be a fallacy, so ask to see the proof. Most of these things should be easy to verify in little time at all so you can resume business as usual.
- Beware of “get rich quick.” If you are pitched an investment with a guarantee of spectacular profits, you are actually being pitched extreme risk. By all means do investigate any investment or opportunity that has potential, but proceed with a healthy dose of skepticism.
- Don’t let anyone rush you. A typical sales tactic is fear of loss, where you are told an offer is going to be available for only a limited time. This tactic is used in both legitimate sales and scams to get you to buy something as soon as possible. When it comes to scams, they want your money before you realize it is a hoax. Take your time with any type of investment, because all legitimate ones will still be there tomorrow.
- Never feel obligated. Show up to this timeshare pitch and we will give you a new set of golf clubs. Salespeople give freebies all the time in hopes that because you are a good person you will have some sort of guilt and feel more obligated to buy what they are selling. Don’t let them use your emotions to make a sale. That little girl may be cute and excited, but that doesn’t mean you have to buy her lemonade.
- Ignore any reference to others. You know your neighbor Jim and his lovely wife Karen? I just saved them a thousand dollars a year by signing them up for this service. Another sale technique is abusing the Jones Effect. You should never believe a salesman right away. If you know Jim and Karen well, give them a call to see if the salesman is telling the truth. And even if they are telling the truth, you should probably not do something just because your neighbor did.
- Know more than them. When red flags are raised depends heavily on the situation, but being educated on the subject can help you hoist the right ones. Not to mention there is nothing more exhilarating than being to call someone out right away on something you consider yourself an expert in.