Open Enrollment 2027: Don’t Just Renew, Review

Open enrollment can feel like another task on a busy calendar. But your choices can affect what you spend on health care, how much you save in taxes, and how well your family is protected financially.

Your employer’s open enrollment season lets you select benefits for the upcoming plan year. It often takes place in the fall. Outside this window, you may be limited in changing certain elections unless you experience a qualifying life event, such as marriage, the birth of a child, or the loss of other coverage.

Before renewing last year’s selections, consider what has changed. Your health, family, finances, or employer’s offerings may make different benefits a better fit for 2027.

Pick a health plan that works for you

Look beyond monthly premiums. A lower-premium plan may have a higher deductible, more cost-sharing, or a more restrictive provider network. Higher premiums may be worth it if the benefits better match your expected care.

HMO, POS, EPO, and PPO generally describe provider-network and access rules. A high-deductible health plan, or HDHP, describes a plan design that may also use one of these network arrangements.

Understand networks and referral rules

• Health maintenance organization (HMO). Coverage generally is limited to network providers, except for emergency care. Many HMOs require a primary care physician to coordinate care and provide specialist referrals.

• Point of service (POS) plan. Out-of-network care generally is available at a higher cost. These plans usually require a primary care physician and specialist referrals.

• Exclusive provider organization (EPO). Coverage is generally limited to network providers, except for emergency care. Specialist referrals often are not required.

• Preferred provider organization (PPO). You can generally see specialists without referrals and receive covered out-of-network care, but you usually pay less within the network.

Confirm each plan’s requirements and actual costs rather than assuming one type is always less expensive.

Understand deductibles and preventive care

A deductible is the amount you pay for certain covered services before the plan begins sharing those costs. Some benefits may be covered beforehand.

Many plans cover eligible preventive services at no cost when you use network providers. However, not every service provided during a preventive visit necessarily qualifies for no-cost coverage.

Consider a high-deductible health plan (HDHP)

HDHPs often offer lower premiums in exchange for higher upfront costs. For 2027, the minimum deductible for an HSA-qualified HDHP is $1,750 for self-only coverage and $3,500 for family coverage. Actual deductibles may be higher.

Certain preventive services may be covered in full before the deductible. Using network providers generally lets you benefit from negotiated rates even before you meet it.

Compare total health plan costs

Estimate each plan’s annual cost by adding premiums to expected care expenses, including deductible payments, copays, and coinsurance. Avoid counting the same expense twice.

Use last year’s care as a starting point, then adjust for anticipated procedures, prescriptions, or family changes. Your employer may offer a comparison calculator.

Also consider the in-network out-of-pocket maximum, which limits your annual cost sharing for covered in-network services. Premiums, noncovered services, and most out-of-network expenses do not count toward it.

If both spouses have workplace coverage, compare enrolling together in one employer plan versus maintaining separate plans. Watch for spousal surcharges and compare the cost of covering children under each plan.

Before enrolling, confirm that your preferred providers are in-network and understand how your prescriptions are covered.

Make the most of a health savings account

If you choose a health savings account (HSA) qualified plan, consider how an HSA could fit your budget. A high deductible alone does not necessarily make a plan HSA-qualified.

To contribute, you generally must have qualifying coverage, no disqualifying additional health coverage, and no Medicare enrollment. You also cannot be eligible to be claimed as someone else’s tax dependent.

For 2027, contribution limits are $4,500 for self-only coverage and $9,000 for family coverage, including employer contributions. Eligible spouses generally share the family contribution limit. Eligible individuals age 55 or older can contribute another $1,000. Each qualifying spouse must make their catch-up contribution to their own HSA. Limits may be reduced for partial-year eligibility.

Contributions through a qualifying employer payroll arrangement generally avoid federal income and payroll taxes. Direct contributions generally provide a federal income tax deduction, but not payroll-tax savings. State income tax treatment may differ.

Withdrawals, including investment earnings, are federally tax- and penalty-free when used for qualified medical expenses. Unspent balances remain yours indefinitely, including after a job change or retirement, and can fund qualified expenses even when you are no longer eligible to contribute.

Expenses generally must be incurred after the HSA was established and cannot be reimbursed elsewhere or claimed as an itemized medical deduction. Keep records to support tax-free withdrawals.

If your finances allow, contributing while eligible and paying current medical bills from other funds can leave more money invested for potential tax-free growth. Consider your cash needs and investment risk before using this strategy.

Save on taxes with a flexible spending account

An employer-sponsored flexible spending account, or FSA, lets you set aside money for eligible expenses. Contributions generally avoid federal income, Social Security, and Medicare taxes, and often state and local income taxes. Your savings depend on your tax rates and eligibility.

Health FSAs

For plan years beginning in 2026, the federal limit on employee pretax contributions is $3,400. Employers may set lower limits. Check enrollment materials for the applicable 2027 amount.

Funds can pay qualified medical, dental, and vision expenses not reimbursed by insurance.

General-purpose health FSA coverage generally prevents HSA contributions while that coverage is in effect. This can include a spouse’s FSA that can reimburse your expenses, even if you never use it.

An HSA-compatible limited-purpose FSA (typically for dental and vision expenses) or a qualifying post-deductible FSA may allow contributions to both accounts. A dependent-care FSA does not affect HSA eligibility.

Dependent-care FSAs

Dependent-care FSAs are not just for child care. They may also cover eligible care for a spouse, parent, grandparent, or other qualifying adult who is incapable of self-care and lives with you for more than half the year. Dependency and work-related care requirements also apply.

You may set aside up to $7,500 annually, or $3,750 if married filing separately, subject to your employer’s plan limit. For married couples filing jointly, the $7,500 limit generally covers combined dependent-care benefits, including employer contributions.

Your tax-free amount may be lower based on your earned income and your spouse’s. Care generally must enable you and your spouse to work or look for work, with special rules for a spouse who is a full-time student or incapable of self-care.

Eligible care can include:

• Care for qualifying children under age 13, or a qualifying spouse or dependent who is incapable of self-care.

• Day care, preschool, before- and after-school care, and day camp.

For qualifying adults receiving care outside your home, the person generally must also regularly spend at least eight hours a day in your home.

Overnight camp and kindergarten tuition do not qualify. Expenses paid with tax-free benefits cannot also support a child and dependent care tax credit.

Understand spending deadlines

FSAs generally follow a use-it-or-lose-it rule. A health FSA may offer a carryover of up to $680 for plan years beginning in 2026 or a grace period of up to 2½ months, but not both.

Dependent-care FSAs do not qualify for that carryover provision, although they may still offer a grace period.

Check deadlines for receiving eligible care and submitting claims. Extra time to submit claims does not necessarily extend the time to incur expenses.

Review dental and vision coverage

Next, consider benefits that help manage other expenses.

For dental coverage, compare premiums, deductibles, networks, and your share of preventive services, fillings, and major procedures. The annual benefit maximum limits what the insurer pays, unlike a medical out-of-pocket maximum, which limits your cost sharing for covered in-network services. Check waiting periods, too.

For vision coverage, review exam benefits, eyewear allowances, copays, and how often benefits apply. Compare premiums and expected expenses with what you would otherwise pay.

Revisit your life insurance needs

Consider what your survivors would need for debts, education expenses, and replacing your income. Review workplace coverage alongside individual policies to identify gaps.

Confirm what happens if you change jobs or retire. You may be able to continue or convert coverage, subject to requirements and deadlines.

Review primary and contingent beneficiaries after family changes.

Employer-provided group-term life insurance above $50,000 can create taxable income based on the IRS-calculated cost of excess coverage, not the full death benefit.

Protect your income with disability insurance

Disability insurance can replace part of your income if a covered illness or injury prevents you from working.

Compare the income percentage replaced, maximum monthly benefit, waiting period, and benefit duration. Also understand the definition of disability and any exclusions or limitations.

Benefits generally are taxable when premiums were employer-paid or paid with pretax dollars. Benefits attributable to premiums you paid with after-tax dollars generally are federally tax-free.

Consider whether the amount you would actually receive, together with emergency savings, could support your household during an extended absence.

Explore your other benefits

Some employers offer student-loan assistance through qualifying educational-assistance programs. For 2026, the tax-free limit is $5,250 per employee for combined eligible educational assistance, including qualifying student-loan payments. It is not a separate loan-repayment allowance. Inflation indexing begins in 2027, so confirm the applicable amount.

Other offerings may include long-term care insurance, pet insurance, financial counseling, fitness discounts, and wellness incentives. Compare voluntary insurance with outside alternatives and look for useful programs you may have overlooked.

Make your choices count

Your benefits are part of your financial plan, not just annual enrollment forms. Before the deadline, ask: What has changed? What will each option cost? Where do you need additional protection?

Thoughtful answers can help you choose benefits that support everyday needs and longer-term goals.

Please reach out if you would like help evaluating how your choices fit into your broader financial plan.

Sam H. Fawaz CFP®, CPA, PFS is the President of YDream Financial Services, Inc., a fee-only investment advisory and financial planning firm serving the entire United States. If you would like to review your current investment portfolio or discuss retirement, college, tax, or other financial planning matters, please contact us or visit our website at http://www.ydfs.com. We are a fiduciary financial planning firm that always puts your interests first and has no products to sell. If you are not a client, an initial consultation is complimentary, with no pressure or hidden sales pitch. We begin with a thorough assessment of your unique personal situation. There is no rush and no cookie-cutter approach. Each client’s financial plan and investment objectives are unique.

Ghost Tapping: What Consumers Need to Know About Tap-to-Pay Scams

As more people use tap-to-pay technology for everyday purchases, scammers have found a new way to exploit that technology in the form of ghost tapping. While ghost tapping sounds like something out of a scary movie, it is a scam with very real consequences.

Tap-to-pay technology is designed to make payments quick and convenient. Whether you use a contactless bank or credit card or a smartphone wallet, the systems rely on near-field communication, or NFC, to send payment information when placed near a card reader. It is typically a faster, more secure way to pay, protected by layers of encryption.

Unfortunately, criminals are always looking for new ways to take advantage of consumers and have begun to use contactless payment technology to steal money and personal data.

In a ghost tapping scam, fraudsters use hidden card payment readers, fake terminals, or compromised devices to trigger an unauthorized contactless transaction. In some cases, they may try to get close enough to a person’s wallet, pocket, or handbag to read a contactless card (did someone really accidentally bump into you?).

In others, they use social engineering to trick someone into tapping their phone or card against a fake or altered payment terminal (remember those fake gas station pump credit card scanners?) Some scams may also involve loading stolen card details onto a fraudster’s digital wallet and then using them to make contactless purchases.

It is important to keep the risk in perspective. Modern contactless cards and digital wallets include multiple security protections, and a successful unauthorized “drive-by” charge from someone passing nearby may be harder than it sounds.

In many situations, the greater risk is social engineering. A scammer may pose as a vendor, charity worker, parking attendant, or fundraiser and pressure a consumer to tap a card or phone without clearly displaying the merchant name, purchase amount, or any added tip.

Consumers should treat an unexplained request to tap the same way they would treat an unfamiliar link or an unexpected request for account information: pause, verify, and walk away if something does not seem right.

The Michigan Department of the Attorney General advises consumers to read the payment screen before tapping and verify the merchant name, total charge, and any tip amount. Consumers should not allow themselves to be rushed into a transaction and should stop if the information on the terminal does not match what they expected. The Attorney General also cautions consumers to resist pressure to act immediately, particularly when a stranger creates urgency or asks for financial information.

Several warning signs suggest a tap-to-pay transaction may not be legitimate. Be especially cautious when a seller or individual:

• Pressures you to pay immediately or discourages you from reviewing the screen.

• Refuses to provide a receipt or cannot clearly explain the charge.

• Uses a device that appears damaged, altered, unbranded, flimsy, or disconnected from a normal point-of-sale setup.

• Asks you to tap more than once because the first transaction supposedly “did not go through.”

• Displays a transaction total, merchant name, or tip prompt that differs from what you expected.

• Approaches people in crowded locations and claims to collect donations, sell tickets, or accept payments without a clearly identifiable business or organization.

While the idea of someone stealing your money with a quick tap sounds frightening, most major banks and card providers have security systems that monitor unusual account activity, and many contactless transactions have value limits.

In addition, mobile wallets typically require facial recognition or a passcode before approving a payment. Still, there are steps consumers can take to help reduce the risk of falling victim to a ghost tapping scam:

• Keep your cards and phone secure, especially in crowded places, such as airports, shopping centers, and public transportation.

• Be cautious if someone carrying a device gets unusually close to you for no obvious reason.

• Before tapping, confirm the merchant name, exact dollar amount, and tip amount shown on the payment terminal. If the information is incomplete or doesn't match the transaction, don't tap.

• Do not let a stranger handle your unlocked phone or guide you through a payment screen. A legitimate merchant should allow you to control your own device and review the transaction before authorizing it.

• Check whether your bank offers card controls in its online app, and use contactless features only when necessary.

• Set up real-time transaction alerts for card purchases, including small-dollar transactions. Fraudsters may use small unauthorized charges to test whether a card is active before attempting larger transactions.

• Use a strong phone passcode and biometric security, such as facial recognition or fingerprint authentication, for mobile-wallet apps.

• Check your account regularly for fraudulent activity and set up fraud alerts with your bank or credit card provider so you are notified of any suspicious card activity.

• Consider using a wallet with RFID-blocking technology. While it may add an extra layer of protection, it should not replace more important safeguards such as reviewing transactions, enabling alerts, and protecting your cards and phone.

• Keep receipts and, when practical, take a screenshot of unexpected payment prompts or merchant information. This information may be useful if you need to dispute a charge.

If you are targeted by a ghost tapping scam, contact your bank or credit card provider immediately and ask them to freeze or cancel your card. You should also update any passwords that are linked to your banking and digital-wallet accounts.

Speed matters if you believe an unauthorized transaction has occurred. Dispute the charge through the card issuer’s official mobile app, website, or the telephone number printed on the back of the card. Don’t rely on a phone number, text link, QR code, or email supplied by an unfamiliar person. Review recent activity on all cards and digital wallets, since criminals may test more than one payment method.

Also remove the affected card from any digital wallet until the issuer provides guidance. Review your financial accounts for unfamiliar devices, new contact information, or changes to account settings. If you believe your identity or account credentials were compromised, change passwords promptly and use unique, strong passwords for financial accounts.

Michigan Attorney General Dana Nessel advises scam victims to report fraudulent charges to their bank, credit card company, or payment app immediately, notify local law enforcement when appropriate, and consider filing a report with the Federal Trade Commission. Michigan consumers may also submit a consumer complaint to the Attorney General’s Consumer Protection Team. Other states have similar consumer protection teams.

As Halloween approaches, the only ghost tapping you should encounter is the kind that comes with a haunted house, a dark hallway, and a good scare, not an unexpected charge on your account. Before you tap, take a moment to verify the details and keep a close eye on your accounts, so scammers don't turn a little convenience into a costly trick.

Sam H. Fawaz CFP®, CPA, PFS is the President of YDream Financial Services, Inc., a fee-only investment advisory and financial planning firm serving the entire United States. If you would like to review your current investment portfolio or discuss any other retirement, college, tax, or financial planning matters, please don’t hesitate to contact us or visit our website at http://www.ydfs.com. We are a fiduciary financial planning firm that always puts your interests first, with no products to sell. If you are not a client, an initial consultation is complimentary, and there is never any pressure or hidden sales pitch. We begin with a thorough assessment of your unique personal situation. There is no rush and no cookie-cutter approach. Each client’s financial plan and investment objectives are unique.

Source: Broadridge Advisor Solutions. © 2026 Broadridge Financial Services, Inc.

IRS Announces Rare Mid-Year Standard Mileage Rate Increase

In an unusual mid-year action, the Internal Revenue Service has announced an increase in the optional standard mileage rates for computing the deductible costs of operating an automobile for business, medical, and moving expense purposes for the second half of 2026. This change was announced in Internal Revenue Bulletin 2026-29. The mid-year change was attributed to recent increases in fuel prices. The standard mileage rate for computing the deductible costs of operating an automobile for charitable purposes is set by statute and remains unchanged.

What are the new rates?

For July 1, 2026, to December 31, 2026, the standard mileage rates are as follows:

• Business use of auto: 76 cents per mile (up from 72.5 cents for January 1, 2026, to June 30, 2026), may be deducted if an auto is used for business purposes. If you are an employee, your employer may reimburse you for your business travel expenses using the standard mileage rate. However, if you are an employee and your employer does not reimburse you for your business travel expenses, you are generally not able to deduct your unreimbursed travel expenses.

• Medical use of auto: 23.5 cents per mile (up from 20.5 cents for January 1, 2026, to June 30, 2026), may be deducted if an auto is used to obtain medical care (or for other deductible medical reasons) if you itemize deductions on your federal income tax return. You can deduct only the part of your medical and dental expenses that exceeds 7.5% of the amount of your adjusted gross income.

• Moving expense: 23.5 cents per mile (up from 20.5 cents for January 1, 2026, to June 30, 2026), may be deducted if an auto is used by a member of the Armed Forces on active duty to move, pursuant to a military order, to a permanent change of station (unless such expenses are reimbursed). An employee or new appointee of the intelligence community may also deduct moving-related costs if the move relates to a change in assignment requiring relocation. The moving-expense deduction is not currently available to other taxpayers.

• Charitable use of auto: 14 cents per mile (the same as for January 1, 2026, to June 30, 2026), may be deducted if an auto is used to provide services to a charitable organization if you itemize deductions on your income tax return. Your charitable deduction may be limited to certain percentages of your adjusted gross income, depending on the type of charity, and subject to a 0.5% floor.

How rare is a mid-year adjustment?

Typically, the IRS issues new optional standard mileage rates during the last few months of the year, with the new rates effective January 1 of the following year. Occasionally, however, the IRS announces mid-year changes. This year’s increase will be the fifth mid-year increase in 20 years.

Prior years with mid-year adjustments include 2005, 2008, 2011, and 2022. As with this year’s increase, these prior mid-year standard mileage rate announcements were largely tied to fuel costs.

Sam H. Fawaz CFP®, CPA, PFS is the President of YDream Financial Services, Inc., a fee-only investment advisory and financial planning firm serving the entire United States. If you would like to review your current investment portfolio or discuss any other retirement, college, tax, or financial planning matters, please don’t hesitate to contact us or visit our website at http://www.ydfs.com. We are a fiduciary financial planning firm that always puts your interests first, with no products to sell. If you are not a client, an initial consultation is complimentary, and there is never any pressure or hidden sales pitch. We begin with a thorough assessment of your unique personal situation. There is no rush and no cookie-cutter approach. Each client’s financial plan and investment objectives are unique.

Source: Broadridge Advisor Solutions. © 2026 Broadridge Financial Services, Inc.

Stay One Step Ahead: Five Recent Scams That Demand Your Attention

Ever since I was a kid, I had a passion for learning as much as I could about money: saving it, preserving it, growing it, and protecting it. Part of protecting it meant understanding how people try to separate you from your money, valuables, or other precious belongings.

That means that while I hate to hear about the latest scams making the rounds and that some people have been taken, I also can’t wait to help warn others to protect them from these scam artists.

Gone are the days when the infamous Nigerian prince would try to scam you with a poorly worded email to entice you to make a deposit to free up that $1 million waiting for you if you only help him solve his legal troubles. That’s child’s play today.

With the help of artificial intelligence, scammers increasingly use seemingly realistic, high-pressure tactics to steal money, access accounts, and lift personal information, without the obvious spelling or grammatical mistakes.

Five of the most recently reported threats involve:

1. Reservation hijacks

2. Fake support pop-ups

3. Malicious CAPTCHA or QR-code traps

4. Mobile-device takeovers

5. Multi-factor authentication (MFA) fatigue attacks that pressure users into approving fraudulent login requests.

I’ll discuss each of the above scams and comment on another scam that targets business owners. Call it a “bonus” scam.

1. Reservation hijacks

The current hotel “reservation hijack” scam grew out of unauthorized access to hotel-partner reservation systems and Booking.com-related guest data, not necessarily credit card theft.

In this scam, a traveler has or makes a legitimate hotel or vacation booking and later receives a text, WhatsApp message, email, or phone call that appears to come from the hotel or booking platform. The message may reference real reservation details and warn that the reservation will be canceled unless payment information is verified immediately.

The result can be stolen credit card information, fraudulent charges, or broader account compromise if the victim also provides other identifying details. These schemes work because criminals exploit trust created by a real booking and combine it with urgency and fear of losing the reservation.

Protection starts with independent verification. Never provide card information, passwords, or payment through a link, phone number, or message you receive unexpectedly; instead, open the travel app directly or call the hotel or platform using a verified number from the original reservation or official website.

2. Fake support pop-ups

Another fast-growing scam involves browser pop-ups claiming an unauthorized charge hit an Apple, Amazon, or similar account. The warning may show a fake support number, a charge amount, and language suggesting the account has been hacked and must be verified at once. Amazon, Apple, and other legitimate e-commerce sites don’t use pop-ups to alert you to an account problem.

Of course, these pop-ups are not real account alerts. They are designed to frighten the user into calling a scammer, disclosing account credentials, sharing one-time security codes, paying for bogus support services, or granting remote access to the device.

The safest response is to close the browser tab or force-quit the browser, if necessary, then verify account activity through the official app or by typing the company’s website directly into the browser. A legitimate company will not use a random browser pop-up to demand immediate action through a phone number embedded in the warning.

3. Malicious CAPTCHA and QR-code phishing

At some point, we have all lamented the sometimes frustrating process of trying to find the hidden motorcycles in a grainy picture so you can get to the website you are there to visit. After all, how hard is it to find the picture of a bus in nine squares?

True to form and banking on our attempts to avoid further frustration, scammers are abusing familiar online habits such as CAPTCHA checks and QR-code scanning.

In one variation, a fake CAPTCHA asks the user to press a key combination, open the Microsoft Windows “run” command or terminal application, paste hidden text, and execute a command under the guise of proving they are human.

That command can download malware and give criminals access to passwords, browser sessions, financial logins, and other sensitive data.

A related threat is QR code phishing or “quishing,” in which a fake QR code stuck to a parking meter, flyer, package, or invoice/payment notice sends the victim to a fraudulent login or payment site.

Remember one simple rule: a legitimate CAPTCHA never asks someone to use keyboard shortcuts, paste commands, or run software.

Treat payment or other QR codes cautiously unless they come from a trusted source. Closing the web page, refusing unusual instructions, and manually visiting the known website are the safest moves.

4. Mobile banking Trojans and device takeovers

A malicious link on a phone can be the beginning of a far more serious problem. Sometimes, you don’t even realize that you clicked on a malicious link until it’s too late.

The link may lead to a phishing page or persuade the user to install a malicious app, fake update, or counterfeit financial app that then requests dangerous permissions such as SMS access, notification access, or Android Accessibility access.

Once installed, the malware may read security texts, intercept one-time passcodes, overlay fake login screens, capture credentials, or hide suspicious activity from the user. In practice, this can let criminals bypass SMS-based two-factor authentication and access email, bank, brokerage, payment, or crypto accounts.

The best defense is to install apps only from official stores, keep the phone's operating system updated, refuse unusual permissions, and never log into financial accounts from a device that may be compromised. If a phone appears infected, stop using it for sensitive logins immediately and shut it off. Then contact financial institutions from a separate, known-clean device, and ask them to temporarily freeze your accounts while you sort things out.

5. Multi-Factor Authentication (MFA) fatigue attacks

Another emerging tactic targets people who already use multi-factor authentication. A criminal who has obtained a compromised password may trigger repeated login prompts on the victim’s phone or computer until the person finally approves one out of annoyance, confusion, or the mistaken belief that it is a legitimate security check. This could come from apps like Microsoft Authenticator, Apple 2FA, or Google Authenticator.

In some cases, the attacker follows up with a fake helpdesk or security call telling the victim to approve the notification to stop the alerts or secure the account. Once the attacker gains approval, they may access email, banking, brokerage, payroll, or other sensitive systems despite MFA.

Never approve an unexpected login prompt. Treat an unrequested MFA push notification like a password request from a stranger: deny it, change the password promptly, and contact the institution or technology provider through a known, trusted channel if you have any questions or concerns.

Bonus Scam: The Online Meeting Invitation

Scammers are increasingly targeting business owners, consultants, and professional-service firms by posing as prospective clients, referral sources, vendors, or investors. They make contact through ordinary channels: email, LinkedIn, website inquiry forms, or phone, and often appear credible because they know enough about the business to ask relevant questions about its products or services.

The contact may provide a name, email address, and phone number, but closer inspection often reveals warning signs: calls go unanswered, the voicemail box is consistently full, details about the prospective engagement remain vague, or the person avoids answering straightforward business questions. The conversation eventually turns to scheduling an online meeting.

The key red flag is an insistence that the meeting occur through their Zoom, Microsoft Teams, GoToMeeting, or other conferencing link. If you offer to host the meeting using your organization’s own account and link, the person may claim they cannot connect, repeatedly encounter supposed technical problems, or press you to use their invitation instead.

The risk is not simply attending a meeting. A malicious link can direct a recipient to a counterfeit sign-in page, prompt the download of a fake “meeting update,” browser extension, document, or remote-access tool, or exploit an unpatched device. The objective may be to steal Microsoft 365, Google Workspace, or financial-account credentials, install malware, or gain remote access to the computer.

A legitimate prospective client may have a platform preference, but should be willing to use a meeting link supplied by your firm or to communicate by telephone instead. Treat insistence on an unfamiliar meeting link, especially when combined with urgency, vague business details, or a request to download software, as a reason to pause.

Best practice: Host the meeting yourself, use your firm’s established conferencing account, and never install software, enter credentials, or grant screen-sharing or remote-control access in response to an unexpected invitation.

A practical defense plan

These scams look different on the surface, but they share the same formula: a believable message, a sense of urgency, and a request to take an unsafe action before the victim has time to think. Whether the prompt says “verify your reservation,” “call support now,” “prove you are human,” or “install this update,” the objective is the same: to obtain credentials, payment information, or device access.

Some simple rules can prevent many losses:

• Be skeptical of unexpected instructions delivered by text, pop-up, QR code, email, or phone call.

• Be especially cautious when an unexpected message or caller asks for account information, a password, or a verification code. Sharing a one-time code may be appropriate during a call you initiated or pre-arranged with a trusted firm, but never provide it to an unverified caller, link, pop-up, or message.

• Never allow remote access to your devices unless you initiated the support request yourself.

• Treat pressure and urgency as warning signs, not reasons to act faster.

• If in doubt, ask a friend or loved one for their opinion before taking action

The key to avoiding scams is to pause, slow down, and take a few extra seconds to consider whether that phone call, voice message, text, email, or pop-up is expected given your facts and circumstances at the time.

When in doubt, don’t respond or react through the message. Verify independently using a trusted phone number, app, or website.

Sam H. Fawaz CFP®, CPA, PFS is the President of YDream Financial Services, Inc., a fee-only investment advisory and financial planning firm serving the entire United States. If you would like to review your current investment portfolio or discuss any other retirement, college, tax, or financial planning matters, please don’t hesitate to contact us or visit our website at http://www.ydfs.com. We are a fiduciary financial planning firm that always puts your interests first, with no products to sell. If you are not a client, an initial consultation is complimentary, and there is never any pressure or hidden sales pitch. We begin with a thorough assessment of your unique personal situation. There is no rush and no cookie-cutter approach. Each client’s financial plan and investment objectives are unique.

Investment Scams Are Getting Smarter

You’d think that after decades in the financial services industry, I would have heard of most of the investment scams out there. First in the internet age, and now in the age of artificial intelligence (AI), there are few weeks that pass without me hearing or reading about someone who was scammed out of thousands, if not hundreds of thousands of dollars. I’ve even heard from clients and relatives of clients who have been victims of clever social engineering and grooming. It breaks my heart when I hear about them losing money, especially when there’s nothing they or I can do to help.

Investment scams today are more sophisticated, more personalized, and more convincing than ever. Fraudsters now use impersonation, social media, text messages, and even AI-generated content to create trust before they ever mention an investment. The result is a steady stream of investors being drawn into schemes that often end in pump-and-dump losses, frozen accounts, emotional distress, and, in some cases, follow-on recovery scams.

For retirees, the danger is especially serious because the stakes are often long-term savings and income. For active investors, the risk is different but just as real: scammers know how to mimic market language, trading ideas, and “hot” opportunities well enough to sound credible. Traders face yet another layer of risk because scams often borrow the language of momentum, catalysts, and short-term opportunity.

How these scams begin

Many of today’s investment scams start in a way that seems harmless. You may receive a misdirected text from an unknown number, a friendly message on social media, or an invitation to join an investment group. The message may not even mention investing at first. It may simply ask, “Are you home?” or make another innocent-sounding comment designed to get you to respond.

Once you reply, the scammer begins building a relationship. Over time, the conversation becomes more familiar and more personal. Then, almost naturally, the topic turns to investing. The scammer might mention a relative who trades foreign stocks, a special market opportunity, or a group that shares profitable ideas. The goal is not to make the first message look suspicious. The goal is to create a long enough interaction that trust develops before the pitch arrives.

That trust-building phase is critical. Scammers know that people are far more likely to ignore a warning sign once they feel they know the person on the other end of the conversation. This is why many of these frauds are less about one dramatic lie and more about a slow, carefully managed relationship. It is not surprising that older adults who are lonely, recently widowed, or worried about outliving their savings can be especially vulnerable.

Why retirees are targeted

Retirees are often targeted because they tend to be careful, financially responsible, and interested in protecting capital or generating income. That makes promises of steady returns or “safe” opportunities especially appealing. Fraudsters know how to dress up a pitch so it sounds like a conservative income strategy rather than a speculative gamble.

The language matters. If someone promises guaranteed returns, “risk-free” profits, or unusually consistent gains, that should be treated as a warning sign. No legitimate investment is free of risk, and any claim that something is safe, certain, or protected from loss deserves immediate skepticism.

Retirees can also be more vulnerable to secrecy and urgency. A scammer may say the opportunity is exclusive, limited, or only available for a short time. That kind of pressure is designed to prevent a second opinion from a spouse, adult child, advisor, or friend. The less time you have to think, the more likely you are to act emotionally. Some scammers insist that sharing the information with their spouse or significant other would disqualify them from the investment scam; this is a big red flag.

Why active investors need to be careful

Active investors are not immune just because they understand the markets. In fact, scammers often use market language to appear legitimate. They may talk about small-cap stocks, catalysts, foreign issuers, or breakout potential in ways that sound familiar to people who follow the market closely. They may even reference themes like FDA approvals, short squeezes, or momentum moves.

The danger comes when the story becomes more important than the fundamentals. Pump-and-dump schemes typically center on thinly traded stocks that are easy to move with hype. Fraudsters promote the stock aggressively, drive attention and buying interest, then sell their own shares into the strength. Once the promotional pressure fades, the stock can fall sharply and become difficult to exit.

Active investors should also be cautious with social media groups that promise hot tips or “research communities.” These are often just marketing funnels leading people into private chat rooms where the real manipulation happens. If an opportunity is being framed as an inside track or a limited-circle advantage, that is exactly the kind of setup scammers use to create urgency and exclusivity.

A note for traders

Traders can be especially vulnerable because scams often borrow the language and tempo of short-term trading. A message may talk about a breakout setup, a catalyst trade, a pre-news move, or an “early entry” before the crowd finds out. That language sounds familiar to traders, which is exactly why it works.

The danger is that the scam is not really about trade selection. It is about control of the narrative. Fraudsters may tell you which ticker to buy, when to buy it, and even ask for screenshots of your order confirmation so they can keep the story moving. In some cases, they may add you to a chat room with other people who appear to be active traders, creating the illusion of a real trading community. It’s not.

For traders, the red flags are often behavioral rather than analytical. Be careful if a supposed opportunity requires secrecy, moves exclusively through encrypted apps, or pushes low-liquidity names with a lot of hype and no verifiable research. A real trading idea can withstand scrutiny. A scam depends on speed, emotion, and group pressure.

Traders should also be wary of any “mentor,” signal service, or chat group that claims unusually high consistency with very little drawdown. That is not how real trading works. No one has a perfect system, and anyone promising one is selling something other than market insight. Some might call it snake oil.

Social media, impersonation, and AI

One of the most troubling developments is how well scammers now impersonate trusted names. They may use a celebrity face, a well-known market commentator, or a fake representative from a legitimate firm to create instant credibility. The image alone can be enough to lower a person’s guard before the details are examined.

Artificial intelligence has made the problem worse. Scammers can now generate polished messages, remove obvious grammar mistakes, clone voices, and create realistic-looking images or video. That means the old warning signs, like awkward language or obvious typos, are no longer enough by themselves. A scam can now look and sound much more professional than it did a few years ago.

This is why investors should pay more attention to the structure of the pitch than the polish of the presentation. If the message is built around secrecy, urgency, guaranteed returns, or a move to an encrypted app, the presentation quality does not matter. The red flags are already there.

The biggest warning signs

The same warning signs appear again and again across investment scams. The more of these you see, the more cautious you should become.

Watch for:

• Guaranteed or “risk-free” returns.

• Pressure to act immediately.

• Requests to keep the opportunity secret.

• Unsolicited investment offers.

• Pushes to move conversations to WhatsApp, Telegram, WeChat, or another encrypted app.

• Requests for personal information, money, or cryptocurrency before verification.

• Celebrity endorsements that cannot be confirmed independently.

• Advance fees to recover money.

If a stranger is pushing an investment, asking for secrecy, and moving the conversation off the platform, that combination alone should stop the process. You do not need to prove it is a scam in order to step away.

How to verify before you act

The best defense is to verify everything independently. Do not use the contact information, click on the links, or call the phone number contained in the message itself. Go directly to the firm’s website by manually typing it in, via a known app, or a trusted database to confirm credentials and contact details.

For financial professionals and firms, check FINRA BrokerCheck, the SEC’s Investment Adviser Public Disclosure database, and your state securities regulator. If the person or firm cannot be verified, or if the details do not match what you were told, treat that as a serious warning.

It is also wise to confirm legitimacy by calling a known number from an account statement or official website. If a supposed firm representative asks you to click a link in a text, download a new app, or send sensitive information through an unofficial channel, stop and verify first.

If a stranger insists on using their own Zoom or Teams link, be cautious: it could expose your device to malware that may give criminals access to your private information, passwords, or financial accounts. If you cannot reach the person directly through a U.S. phone number, or if their voicemail is always full and their messages keep steering you to a website, do not proceed.

Why talking to someone helps

One of the most effective protections is also one of the simplest: tell someone else you know and trust before you act. Scam artists depend on emotion, speed, and isolation. They want you to decide quickly and privately. The moment you explain the opportunity to a trusted person, you slow the process down.

That pause is powerful. It gives you time to think more clearly, and it gives someone else a chance to hear what you may be overlooking. Many bad decisions sound reasonable in your own head until you say them out loud.

This matters especially for retirees making decisions about income, capital preservation, or distribution strategy. It also matters for active investors and traders who may feel pressure to move fast on what looks like a market opportunity. Good investing is not just about being informed. It is about having a disciplined process.

What to do if you’ve been targeted

If you suspect a scam, gather documentation immediately. Save messages, screenshots, websites, account details, transaction records, and any names or numbers used in the conversation. If cryptocurrency is involved, preserve wallet addresses and transaction details as well.

Then report it as quickly as possible. Notify your broker or financial institution, the SEC, FINRA, your state securities regulator, and the FBI’s Internet Crime Complaint Center. If money has already been sent, timely reporting may improve the chances of tracing the fraud and helping regulators identify related cases.

Be especially careful with follow-on messages that claim they can help you recover your money. Recovery scams often target people who have already been victimized and are emotionally exhausted. If someone asks for a retainer, processing fee, or other upfront payment to return your funds, that is a major red flag.

Final perspective

The biggest mistake many investors make is assuming scams only work on careless people. In reality, these schemes are designed to exploit normal human reactions: trust, curiosity, urgency, fear, and the desire not to miss out. That is why even experienced retirees, active investors, and traders can be targeted successfully. Some well-seasoned financial advisors have been targeted and victimized.

The solution is not paranoia. It is a process. Verify independently, slow down, avoid isolation, and never let secrecy or pressure drive an investment decision. If an opportunity is real, it will still be there after you check it carefully.

Of course, the old adage applies and is always worth remembering:

“If something seems too good to be true, it probably is.”

Sam H. Fawaz CFP®, CPA, PFS is the President of YDream Financial Services, Inc., a fee-only investment advisory and financial planning firm serving the entire United States. If you would like to review your current investment portfolio or discuss any other retirement, college, tax, or financial planning matters, please don’t hesitate to contact us or visit our website at http://www.ydfs.com. We are a fiduciary financial planning firm that always puts your interests first, with no products to sell. If you are not a client, an initial consultation is complimentary, and there is never any pressure or hidden sales pitch. We begin with a thorough assessment of your unique personal situation. There is no rush and no cookie-cutter approach. Each client’s financial plan and investment objectives are unique.

Source: American Association of Individual Investors