(MENAFN- News Direct) > A Utah woman calling into The Ramsey Show recently was facing a tough situation.

"About a year and a half ago, my husband got involved with some online investment deal which turned out to be a scam," Mary explained. "He gave away all our retirement, and then he borrowed another $250,000 more."

Mary and her husband are in their 70s. They took a reverse mortgage on their house, and they're each working multiple part-time jobs to pay back what he borrowed.

She called into The Ramsey Show because she was concerned about her taxes, but there's a bigger issue to address - seniors are often the targets of scammers and need to know how to protect themselves from a terrible loss.

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Here's how this couple lost everything in a retirement scam

When she called in, Mary explained to the Ramsey hosts that her husband ended up not only giving away around $500,000 in retirement savings, but also borrowing more money on credit cards, personal loans and even from the couple's son. And it all happened because he got sucked into an investment scam.

"Some guy he used to work with called him and said, 'I've got this great thing going on, do you want to get in on it? I'll have my girl call you,' which she did. And he started investing. The investment went through a cryptocurrency."

Once Mary's husband was sucked into the investment, the scammers ended up telling him that he needed more money to get his money out because of fees. So he not only lost the initial investment, but he was prompted to go into debt to try to get out of the scam.

Unfortunately, Mary's husband is not alone in this situation. In the 2024 Federal Bureau of Investigation Internet Crime Report, it was revealed that Americans 60 and over suffered the most losses of any age group due to crypto fraud [1]. While there were 149,686 total complaints about crypto fraud causing $9.3 billion in losses, those 60 and over alone lost $2,839,333,197.

Mass explains that crypto scammers often target seniors because they are perceived to have a lot of wealth due to retirement savings, and because criminals assume they aren't familiar with modern technology like cryptocurrencies so it will be easier to trick them into sending funds [2].

This usually starts with contact through unsolicited phone calls, with the scammer often impersonating a trusted person like a government agency representative or financial advisor. According to Mass, after the scammer establishes trust, they convince seniors to provide access to retirement funds.

Tragically, as in Mary's situation, crypto scams can cause devastating loss with no possibility of recovery because these currencies make transferring money anonymously very easy. The funds are gone, and Mary, her husband, and other victims, have no idea where they went.

What to do if you are a scam victim

For Mary and others who are a victim of these scams, there are typically few options for getting back your money.

If you've paid a scammer with a credit card or debit card, or through a wire transfer company, you can see if your bank, card issuer, or wire transfer company can reverse the transaction and should contact them ASAP. Sadly, when you send money via cryptocurrency, there is nothing you can do, according to the FTC [3].

You can and should report the scam, of course, USA has info on where and how to do that [4]. You should also get documentation of the police report. This is important because while Mary was very worried about the taxes from her husband liquidating her retirement funds, you may be able to deduct the money from the scam.

There are strict limitations on when and how this can happen, and the tax laws are evolving on this issue, as the Taxpayer Advocate for the IRS explains [5]. Still, you should have documentation and should talk to a tax professional to find out if this is an option for you.

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How can you avoid scams

The Ramsey Show hosts told Mary that they would provide her with access to tax and financial help to try to dig out of her situation, since it was too complicated to resolve on air. However, Rachel Cruze did advise that seniors could avoid scams like this by sticking to boring investments.

That's generally good advice. Retirees should:

• Not take unsolicited phone calls about their money
• Never liquidate retirement investments without talking to a trusted financial advisor they find independently
• Invest in simple, boring investments like index funds and bonds purchased through a reputable brokerage firm

Mary also remains limited in her knowledge of what's happening with the couple's finances, as she said she finds talking to her husband about the situation is difficult for her. The Ramsey Show hosts urged her to verify everything her husband is currently telling her about money, and that's a good idea.

In general, both members of a couple should be involved in money management and financial decisions, especially major ones like liquidating a retirement plan. This added set of eyes and ears can help seniors avoid big mistakes - and also protects them from more mundane issues like the dearth of a spouse that leaves them suddenly responsible for money management.

How to recover after a scam

For now, Mary and her husband are working multiple jobs to try to dig out of debt. This is often necessary to recover from a scam, as is cutting expenses dramatically.

While Mary and her husband are in their 70s and limited in what they can do, working extra hours, cutting budget expenses to the bone, and potentially even moving to a lower cost-of-living area could be key steps to take when a scam has drained retirement funds.

Working with a financial professional is an added expense, but also could be a good idea too as an advisor can help the couple to create a clear plan for getting out of debt, to make a new budget that works for them, and to make sure they have a better plan for managing their funds going forward so they aren't vulnerable to additional losses.

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[1]. FBI Internet Crime Complaint Center .“Federal Bureau of Investigation Internet Crime Report”

[2]. Mass .“Cryptocurrency scams are targeting the elderly: What you need to know”

[3]. FTC .“What to do if you were scammed”

[4]. USA .“Learn where to report a scam”

[5]. Taxpayer Advocate .“IRS chief counsel advice on theft loss deductions for scam victims and what it means for taxpayers”

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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