Scams are done just to steal your money. In spite of the best technology to offer protection to your accounts, scamsters and fraudsters have ways to steal your money. They target people of all ages, income levels and even educated people, and steal their money.
Emotions are a great way to target people. People who are not in control of emotions have lost lakhs and crores of rupees. Let’s have a look at how fraudsters trick you through emotions.
There are cases where fraudsters bump up the prices of a stock, by pumping a lot of money into it. Investors look at this price rise, and get greedy. They feel waiting too long to make an investment decision could cost them in profits and jump in without doing a double-check. This is the fear of missing out or FOMO.
What do the fraudsters do? They simply wait as more and more people pump in money and the stock price goes up. These fraudsters then withdraw from the stock at inflated prices; and eventually the stock price crashes. All the people who jumped into this stock at inflated prices suffer a heavy loss.
Always do your homework and try to find out why the stock price rose dramatically.
A friend speaks of a great investment where he makes a lot of money. You start wondering if leaving your money lying in the savings bank account is a good idea.
Your friend could have put his money in a Ponzi Scheme and not realized it. He would eventually suffer a heavy loss and take you with him.
Even if he has made a great investment it might not be suitable to meet your financial goals. Investing in equity requires a time horizon of 5 years or more. You might not have the time to wait for these returns and suffer a loss.
There are plenty of people offering free advice on money matters. Family, friends and plenty of bankers are ready to dole out financial advice.
Bankers would push financial products when you visit the bank branch. These are financial products you may not need.
Senior citizens are the favourite target and many of them are mis-sold life insurance plans, even though they have no dependents. Health insurance plans are sold which may not cover the health conditions, these elderly people suffer.
Don’t fall for friends and neighbours advice when they come to you saying they represent an insurance company. They are just like any other insurance agent and could mis-sell insurance plans to earn commissions.
You fall for these frauds and mis-selling techniques because you have not done your homework. Many people perceive bankers to be financial experts which may not be the case. Besides, you must never buy a financial product which does not meet financial goals.
It’s good to seek the help of a financial advisor before availing life insurance or making an investment. He gives the best financial advice which meets your financial needs and goals.
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