Is It Important To Have A Lasting Power Of Attorney?
New research has warned that more than a million people in the UK could be at risk, as they have failed to set up a Lasting Power of Attorney (LPA).
Company Zurich, which commissioned the research, found that 79% (1 in 4) of the almost 800 clients surveyed had failed to set up a LPA. The research looked at people who are using the new ‘pension freedoms’ pension pot to manage their retirement.
Zurich said that without the “vital legal document, families could be locked out of a loved one’s finances should they become too ill to manage their affairs, leaving them facing a lengthy court process before they can step-in to help.”
It said that more than 1.7m retirees could be affected by 2025, at a time when the Alzheimer’s Society estimates more than a million Britons will be living with dementia.
As a result, thousands of older people could be left vulnerable and in a “later life financial crisis”, the firm says, without a trusted relative or friend ready to step in should that person lose mental capacity.
What is a LPA?
A LPA is one of the most important documents you’ll ever make. It names who will make decisions on your behalf should you lose mental capacity (e.g. as a result of an accident affecting your ability to make decisions or if have dementia). This person is your ‘attorney’. Those decisions can range from how your money will be spent to where you will live. It gives you control of your future, especially in older age.
Decisions an attorney makes for you would be based on your aforementioned wishes and could be financial, health and wellbeing-related or both (there are two different types of LPAs). It is your attorney’s responsibility to always act in your best wishes, so obviously this should be a person you deeply trust and who agrees wholeheartedly to take on the role (it’s a big responsibility!). Common attorneys are your partner or spouse, brothers or sisters, very close friends or even a family doctor or lawyer. They must be over 18, have mental capacity themselves and fit a few other specifications (e.g. not be bankrupt). You can have more than one.
Do I need a LPA?
Yes, everyone over the age of 18 really should have one or both types of LPA. It is especially important as you get older and it’s more likely you could, at some stage, lose mental capacity, temporarily or on a longer-term basis.
What happens if I don’t have a LPA?
Without a LPA, it’s possible you could have no control over your future.
As mentioned by the researchers above, you could be left in a ‘later life financial crisis’, if you don’t have someone to review and manage your finances.
It could also leave your loved ones facing a lengthy and expensive court process, should they need to gain control over your affairs, and you don’t have any legal documentation stating that they should be given this right.
Even if you are young, you should think about later life now and make sure you are protected. Losing mental capacity could occur through many incidents, such as a car accident, the onset of a mental health condition or other illness. This could happen to anyone, any age!
If you don’t have a LPA, who will look after your property and assets and ensure that you are well cared for? The courts will decide that, and the person who is appointed may not be your preferred chosen friend or relative.
What are the next steps?
There are a few things to think about before you make your LPA, of course the most important being, who you should appoint as your attorney.
Think about who you trust and would want to make decisions on your behalf, if you could not. Consider also whether they are suited to holding this much responsibility. Chat to them about this. It’s a big decision.
Next, you’ll need to enlist the assistance of a solicitor who is experienced in this arena (wills, probate and estate planning). A solicitor will talk you through the steps and draw up your LPAfor you to make sure this legal document has been done correctly.
At GWlegal, you will be looked after personally by Linda Cummins, a solicitor with more than 20 years’ overall experience. She is a true expert in all things wills and probate and also an incredibly caring person, who will always be there to guide you through this delicate but vital process.
Who are GWlegal?
If you have a legal matter you wish to discuss don’t hesitate to get in touch. You can call us on 0345 373 3737 or email us at email@example.com with your question.
Who are GWlegal? We’re a national firm with local values.