I lost over $20,000 in a scam. How do I recover?

I recently fell for a scam and lost more than $20,000, and while I tried everything to get the money back, I’ve now accepted it’s just gone. I transferred the money, obviously not knowing it was a scam at the time, but I don’t know how to move forward from this. I’m embarrassed that I fell for it, but at the same time angry that this can happen. I’m now scared of every email, phone call, wondering if it’s another scam. How can I move on?

Firstly, if you haven’t already, you might find some useful resources on the government’s ScamWatch website, and the National Identity and Cyber Support website idcare.

Being scammed is a traumatic experience that may continue to haunt you for a while.Credit: Simon Letch

There are a few general tips to protect yourself from future scams or hacks. It’s a good idea to set up two-factor authentication on important accounts (e.g. banks, investment accounts, super funds), and ensure you have a good passcode on your phone (not 1234, or 0000), to minimise easy access to your accounts. It’s also a good idea to avoid clicking on any links in texts or emails from phone numbers or email addresses you don’t recognise.

I’ll leave the practical steps here because that’s not the question you asked (but I thought these basics were important). I’ll move on to your actual question – how do you move forward?

I’ve talked to people through various financially traumatic events – from the financial loss from a divorce, to financial betrayal in the family and scams. While there is the financial loss, a lot of rebuilding comes down to how well you navigate the emotional journey.

Here are some things that will help you on that journey.

This wasn’t carelessness on your part – it was a malicious attempt to disarm your defences.

Don’t bypass the difficult emotion

It’s important to recognise that this can be a traumatic experience. This means you may continue to experience some heavy emotions for some time.

Maybe there’s shock, hurt, anger at the way someone could do something like this to you. Maybe there’s grief over the loss of money, the plans you had with that money, and letting go of the life you thought you’d be living with that money compared to the situation you’re in now.

These emotions are unlikely to go away suddenly. You might think you’ve moved on, then suddenly out of nowhere one day, you get a text message and it triggers fear and anxiety.

What I’m essentially saying is – give yourself permission to go through the natural human emotional journey you need to go through, to process this event.

The mistake I see is people trying to rush “moving on”. The emotions are uncomfortable, so they’d rather avoid, ignore, bury them in busyness, pretend they’re fine. Except that doesn’t make those emotions go away – they’re still there, unacknowledged, unfelt, unprocessed.

Why is that a problem? Because those emotions then show-up in your financial decisions. You become more guarded, scared, reactive. You shy away from healthy risks that will grow you. You continue to carry this trauma from your past into your present, and therefore your future.

You don’t want this to become a defining feature of your financial life – one which stops you from growing. You want to be able to leave the emotion of this experience (but not the lessons) in the past – so one day, you can look back and tell this as “a crazy story” that happened, not “the thing that ruined me financially”.

Don’t make it ‘mean’ something about you

Be careful about the meaning you attach to this experience. It’s easy to slip into feelings of shame if you’re telling yourself you weren’t careful enough, or you should have known better.

Remember that scammers are actively trying to deceive you. Was there something you could have done to avoid it? Maybe, and that’s something you know now. But I’d discourage you from letting that be something you let taint your own self-image. This wasn’t carelessness on your part – it was a malicious attempt to disarm your defences.

The narrative you tell yourself about this will shape how you show up in future financial decisions. Do you let your confidence be shaken because you now believe you’re not good at making financial decisions?

Do you shy away from financial opportunities because you no longer trust your ability to discern a good opportunity from a scam? Or do you recognise that the malicious acts of someone else says more about them, than it does about you?

Years from now, you don’t want this to be an event you look back on, thinking “I feel so silly for falling for this.” Instead, you want to work towards a narrative that says: “This unfortunate thing happened, and boy did I learn from that, and today I’m financially stronger because of it.”

Paridhi Jain is the founder of SkilledSmart, which helps adults learn to manage, save and invest money through financial education courses and classes.

• Advice given in this article is general in nature and not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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