The number of Lasting Power of Attorneys (LPAs) being registered dropped by nearly a quarter (23%) in the last year, despite the pandemic highlighting both the need for protection and the speed with which the unexpected can strike.
Figures published by FTAdviser confirm that in 2020/21 there were 695,000 LPAs registered, compared to 909,000 registered the previous year.
Some aspects of the process moved online during the pandemic in a bid to simplify and speed up the process. It can still be time-consuming, however, and the final stage of registering the LPA must still be done by post.
The time and effort spent now could make all the difference to you and your loved ones if you lose the capacity to make your own decisions.
What is an LPA?
An LPA allows you to decide who would look after your health and finances if an accident or illness prevented you from doing so yourself.
Without an LPA in place, a lengthy – and more expensive – process is required to appoint a deputy, but you have no control over who that deputy will be.
There are three main types of LPA:
- A Health and Welfare LPA can cover your daily routine, medical care, and moving into a care home, for example.
- A Property and Financial Affairs LPA allows a person you choose to manage your finances, pay bills, and collect benefits on your behalf.
- A Business LPA allows a person to make decisions regarding your business, possibly including paying wages, hiring new employees, or purchasing and selling property.
Appointing an attorney can give you a sense of control and peace of mind
An LPA can be put in place by anyone over the age of 18 with the mental capacity to do.
You can choose the person (or people) you want to manage specific aspects of your life, should you become unable to do so. You can also choose the areas in which they won’t be permitted to make a decision.
You might choose one attorney to look after your general finances but prevent them from making decisions about your property, for example. Or choose someone else to look after your health and wellbeing but prohibit them from making end-of-life decisions.
While these aren’t comfortable things to think about, having an LPA in place means you can protect yourself against the unexpected, while you are still in a position to have ultimate control, and give yourself peace of mind.
Having an LPA could lessen the financial stress for your loved ones
While you can begin the process of setting up an LPA online, you must register the LPA with the Office of the Public Guardian (OPG), and this can only be done by post.
This costs £82 for each type of LPA, meaning you’ll pay £164 to register both a Property and Financial Affairs LPA and a Health and Welfare LPA. Assuming there are no mistakes in your application, the registration process takes the OPG up to 20 weeks.
Once your LPA is registered though, your chosen attorneys can take control of your affairs the moment you become incapacitated and unable to make decisions yourself.
Financial matters can be organised and resolved quickly, saving unnecessary stress for your loved ones at what will already be a difficult time.
If you become incapacitated without an LPA in place, you have no control over who manages your affairs. Not only that, but the loved one that applies to become your deputy will have fees to pay that exceed the cost of setting up an LPA.
The fee for applying as a deputy is £365 (with an additional fee of £485 if the court decides a hearing is required before an appointment can be made), as well as an annual supervision fee. Someone acting as a deputy for the first time will also need to pay a £100 assessment fee.
A Business LPA can offer protection to your business
As with a Health and Welfare LPA and a Property and Financial Affairs LPA, the person you choose to function as the attorney for a Business LPA will need to be someone you trust. They must also have the necessary skills and knowledge to successfully run your business.
Knowing that you have picked the right person will give you peace of mind. Your business can continue to run smoothly without any interruption, keeping your customers, suppliers, and contractors happy, as well as your colleagues.
If your family income is reliant on the successful continuation of the business, you will have the confidence that your family will continue to be looked after too.
Get in touch
Putting an LPA in place is a simple process that affords protection and peace of mind to you, your loved ones, and the partners in your business.
You have control over the attorney or attorneys you choose and the limits of their decision-making power. Knowing that you have people you trust ready to step in and look after your affairs if you are no longer able will give you peace of mind.
You’ll also know that your loved ones will be saved from the unnecessary cost and stress of applying to become a deputy, should the worst happen without an attorney in place.
Please contact us to find out how our Chartered Financial Planners can help you decide on the type of LPA you need and work with you to put it in place.