For Parents

How to Protect Your Kids From Financial Scams

There are money scams left and right out there. Keep your kids safe with these tips.


As a parent, you want to protect the children in your life from everything, but financial scams are not something that is commonly thought about. Unfortunately, kids and teens are the perfect targets because they don’t understand that not everyone is a good person. 

It’s never too late to teach your kids about personal finance, money management, and credit! Let’s jump into learning about common financial scams and how to protect your family from them.

Common Financial Scams

  1. Asking for personal information or banking information. One common scam is a phone call from a “Sheriff” of a small town that says your social security number is being used in criminal activity, but they need to verify your SSN. Nope. This is fake. Another is your bank calling to ask you for your PIN for your debit card. The bank won’t contact you to verify this.
  2. Money deposited “accidentally” into your account and a refund is requested. Someone you don’t know accidentally deposited money into your account, and now they want a refund. You’re a nice person, so you allow it. That check or transaction bounces, and now you are in the negative in your account, and they have your money.
  3. Fake websites that offer deals that are too good to be true. The holiday season is prime time for these scams. You search for the perfect gift and find a website that has that name-brand item on sale for 70% off! Great deal, right? Nope. The website is fake and trying to get your banking information so they can steal it from you.
  4. “Skimmers” on ATMs or gas pumps. A skimmer is a device that goes on top of the card reader and collects PINs or personal information, then transmits it back to the thief. 
  5. Emails from your bank with fake links. Be wary of emails from your bank asking you to log in with a link in the email. Don’t click on links in emails to download files unless you trust the source and verify the email source.
  6. Social media friends start asking for money or gift cards because they are in trouble. Sending your friend or family member thousands of dollars in Apple gift cards will not help get them back from a foreign country, and they probably aren’t in that foreign country. If you get a request for funds from someone you know, call them to check on them.
  7. Get rich quick with no effort, only money. There is no way to get rich quickly in life, and anyone that says otherwise is lying. Making money takes time, effort, and hard work. If you choose to invest in something, make sure you have researched from reputable sources and understand what you are investing in.
  8. Fake apps on smartphones. App stores have thousands of apps, and some are fake to collect personal data or expose users to graphic content during gameplay. 
  9. Predatory lending. Loan sharks take advantage of people in a desperate position and charge impossible fees or interest rates on loaned money. Payday or title loans are legal in some areas but shouldn’t be. These loans have interest rates upwards of 300% and can seize your car if you cannot pay off this loan or garnish wages from your job.
  10. Dating scams. Your new partner seems like “The One” and does everything right until suddenly they come to you with a financial disaster and ask for money to fix the problem. You have feelings for them and give them money, but soon they come and ask for more. 

How to Identify a Financial Scam

The first sign of a scam is if someone is asking for too much personal information and doesn’t have a reason to. The cashier at the grocery store doesn’t need to know the PIN to your debit card, and the bank won’t call to verify your Social Security Number because they already have it on file. 

If it sounds too good to be true, it probably is.

Urgent-sounding situations are probably not as urgent as the caller or emailer implies. Don’t buy into the hype and take time to research the situation before reacting. 

How to Protect Yourself and Your Family From Financial Scams

Have open conversations about money with your kids and encourage them to call you if they face a situation that they are not sure how to handle.

Consider creating a password not used in daily conversation that your kid can ask a caller for if they are contacted asking for personal information from you or your bank. 

Don’t advertise your lives on social media because this can make you a target. A friend of mine built a lifestyle business on Instagram and spoke openly about his investments in cryptocurrency. His account was hacked and stolen. The hacker contacted him and told him that he would have to pay 1 Bitcoin to get it back if he wanted his account back. At the time, Bitcoin was about $30,000, and his business was worth much more, so he paid it, but the hacker told him that he steals at least 1 account per week, and most people pay the ransom. 

Avoid using public wi-fi for banking or sensitive information. If you have to check your account balance before purchasing, use your data or check the account at home before leaving. 

Smart Habits You Can Introduce to Teach to Your Kids to Keep Them Protected

Monitor your credit report, bank account, and credit cards for unusual activity, and teach your kids that checking these frequently helps prevent fraud. 

Don’t save your payment information on online shopping websites that your kids use, and encourage them to be mindful of their shopping habits. A hacker can easily change the stored information, and products can be delivered to their house instead of yours.

Avoid signing up for every newsletter or mailing list that offers money off a purchase because your email address can be used to find information about you and your family in the wrong hands. 

Enable firewall and antivirus protection on your devices. Teach your kids what these tools are and how to use them. Tell them why these are enabled on your devices and install them on their devices, too. This can warn you if malware is installed or your online security is at risk.

Be mindful of emails with strange subject lines with numbers, symbols, or misspelled words. Check for links in the body of the email that could be malicious. Show these emails to your kids, so they know what to look for. 

Monitor their online activity or apps they download. Talent searches or scholarship offers that ask the child to pay to qualify are likely scams that target children specifically. 

As you watch the news or participate in social media and see new scams that have come up, talk to your kids about what you have found. Encourage them to come to you if they find something you haven’t seen.

Teach them to be careful of who they befriend at school, work, online, or on social media and what they share with others. Don’t tell people when you will be out of town or what you spend your money on. Keep your daily activities within your family or close family friends because not everyone needs to know your business. 

Where to Report Financial Scams

Most of us just ignore scams because we know enough to avoid them, and they are just an inconvenience to us that we can brush off easily. Reporting scams to the government can help prevent others from falling victim to them, especially new scams as they crop up. 

If you have lost money or personal property to a scam, file a police report first. Next, report the fraud to your state consumer protection office. 

Notifying a federal agency will likely not get you your money or property back, and you won’t get a follow-up on the investigation. However, reporting to the federal government can help them track common scams and take action against companies that are repeat offenders to shut them down or prevent operations. 

To report disaster or emergency scams, including Coronavirus-related scams, file a report with the National Center for Disaster Fraud’s web complaint form or call 866-720-5721. 

The Federal Trade Commission (FTC) is the federal agency that collects information and reports on most scams like email, phone calls, fake checks, scholarship scams, prizes, or sweepstakes. You can make a report at 1-877-382-4357. To report identity theft, submit the form at or call 1-877-438-4338. 

To report Social Security or IRS scams, submit this form or call 1-800-366-4484 to report to the Treasury Inspector General for Tax Administration. 

Teaching your kids about financial scams will help protect against them. Encourage them to have conversations with you and be open about what is going on in their lives. Scammers target children and teens because they think they are easy targets, so keep them as far away from your family as you can.

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About the Author

Jessica Anglin

Jessica was raised in a household where her parents didn't know how to pay bills on time and indulged in life's pleasures on a consistent basis in order to cover the misery from working jobs they hated for money that wasn't enough to live off of. She took on the role of caregiver to 4 siblings at age 15 and started her first business selling tie-dye t-shirts in order to buy food and provide a stable home. Nineteen years later, she owns three successful businesses, has earned an MBA in Finance, and works daily to set an example for the next generation on how to build wealth so they never face the same struggles.

Last updated on: June 1, 2022