This month a test was revealed that can track how well a person is ageing, which could help doctors identify patients who are most at risk of dementia and other age-related conditions. While advancements in science may help with preventative and palliative care, a fail-safe should be in place in case in later life we become unable to manage our affairs.
Setting up a Lasting Power of Attorney (LPA) gives a trusted individual or individuals the legal authority to look after our affairs should we become mentally incapable to do so.
An LPA provides for two major areas in someone’s life. The first deals with property and financial affairs. This lets the person choose one or more individuals to make decisions about money and property for them, for example, paying bills, collecting benefits, and selling property.
The second type is the Health and Welfare LPA. This allows the attorney to make decisions on behalf of that person regarding their welfare, such as around medical care, where the person might live (such as a care home) and allowing or refusing medical treatment.
A personal welfare LPA can only be used once the person has become mentally incapable of making these kinds of decisions for themselves.
There must be a certificate from a prescribed person, such as an Independent Financial Adviser (IFA), who can confirm that the person understands the LPA and that there has been no undue pressure put on them to establish it. This clearly provides a safety net for those people who might be vulnerable.
The help of an IFA can truly make a difference, as when someone becomes incapacitated, their needs change and finances can become complicated. Good financial advice can assist with the financial LPA, helping to evaluate the assets that a person – or couple, where one partner has become incapacitated – may have and how best they can be employed to provide for their needs.
Planning should not start when an individual becomes incapacitated and the LPA takes effect, as a person’s finances could have already fallen into disarray. It is better to put a financial plan in place as far in advance as possible so that everything is already established. The full extent of the person’s assets are known, they are well documented and there is the right balance between some ready cash and shorter, medium and longer term investments within their overall portfolio.
This will make it far more likely they will have sufficient means to cover their needs as well as making the attorney’s role a lot easier to undertake.
Hopefully having prepared a Lasting Power of Attorney it will go in a drawer and never need to see the light of day again, but as it provides peace of mind for you and your loved ones, the money spent on preparing it could be one of your best financial planning decisions.
For more information and guidance around financial planning issues, arrange a free consultation with a Lowes Financial Management Consultant or attend one of our seminars which are being hosted across the North in October. For dates, times and locations, please go to the Lowes website, Lowes.co.uk/seminar.