It’s important that investors and retirees safeguard their investments as much as possible.

Choosing the right investment tools for your financial goals are just as necessary as your investment security. One should not become paranoid, however, as such behaviour can cause much stress and anxiety instead of giving the peace of mind investors seek.

I recommend that investors should do due diligence and research the companies they intend to invest their monies in. Make sure the investment entity is registered by seeking information from the relevant regulatory authority. If your research revealed that the company you intend to invest with has a history of disputes with regulatory authorities, then that’s a red flag. Make Google your friend. Conduct your own independent research. It doesn’t take much time and it’s worth the effort. Visit the company’s websites, and learn more about the investments that an entity offers. Where do your friends and associates invest? What have been their experiences? Unbiased information can prove to be very useful. Once you have decided which entity or entities to invest your funds in, assess the risks that can impact the investment.

Every investment is exposed to risks. The greater the return on the investments the higher the risks. The help of a licensed and professional advisor can help in assessing the risk factors. Never invest your funds in investment instruments that you don’t understand. If in doubt, take the time to find out more about the subject matter before making a decision. Also, there are various types of investment scams. Learn all you can about how to avoid becoming prey. Investment fraud is real. Find out about any fees associated with the investment you make. Check out the liquidity of investing. How easily can the investment be liquidated should you request return of the funds? Don’t invest in a product because it seems “everyone is doing so”. Is the investment the right type for you? Understand your tolerance for risk and the investment timeline of your goals. Investment products should align with your goals.

Some investors believe that online platforms will eliminate fraud or scams. But this is further from the truth. Online scams are an imminent danger. Learn how to protect yourself online. Be careful of offers of very high returns at low risks. Avoid Ponzi schemes. These are investments that offer high returns but the funds are not invested, instead, payouts are made based on funds from new investors. Don’t invest in products or investment instruments that are too complex to understand. Make sure that regular updates in writing can be had on your account. Examine statements closely. Note possible errors as this could signal a red flag. Seek clarification promptly.

If you encounter difficulties or unusually long delays in withdrawing or closing your investment, it triggers cause for concern. With regard to pension contributors, the pension law requires that you receive a pension statement once per year from your pension provider. Be alert. Keep track of your pension savings and investments. Know where your money goes.

Be wary of “pump and dump schemes”. These are schemes whereby scammers seek to increase the value of a company’s stock by issuing inaccurate or misleading statements about the company so as to influence potential investors to buy the shares. When the share prices are “pumped up” the fraudsters seek to sell or “dump” their shares in order to make a profit. The share price will then fall and the unsuspecting investors suffer a loss on their investment. Be careful of the use of your phone numbers and e-mail addresses on the Internet and social media platforms. Fraudsters use these platforms for investment fraud. Therefore, it’s important to research investment offers or opportunities that you may see online before submitting e-mail addresses or telephone numbers to people you don’t know or untrusted sites. Identity theft and phishing are cause for concern for investors.

For accessing online investment, accounts use a strong password that is difficult to guess. It should consist of numbers and special characters. Change passwords regularly to protect from investment fraud. It’s highly recommended to avoid having the same password for all your accounts online.

Desist from using public computers or public Wi-Fi to access your investment information. When using your Wi-Fi at home ensure that your computer or phone is secured and has relevant software updates. Pre-retirees and retirees, especially, need to safeguard their investments at all costs. There is precious little time to recover from investment wipe-out. Protect your retirement funds by being informed.

— Grace G McLean is financial advisor at BPM Financial Limited. Contact her gmclean@bpmfinancial. and visit the website: www.bpmfinancial.com. She is also a podcaster for Living Above Self. E-mail her at [email protected]