Time is of the essence for LPAs

Up to the beginning of March 2019 approx 154,600 Lasting Power of Attorney registrations have been made in the UK, according to the gov.uk LPA registration section.

That means an average of 77,000 people per month are seeking ways of registering for an LPA and quite possibly looking for support and advice in order to do this. This monthly figures is more than what the annual figures was just over ten years ago, so it is clearly on the rise.

Yet it seems there is still much to be done in educating people and making them aware of what an LPA is and how important it can be later in life. According to research by Direct Line Insurance, 80% of respondents assumed that, if they were to lose mental capacity, their family or trusted friends would automatically be able to take make medical decisions on their behalf and take over control of their financial affairs.

The research also found that over a third of respondents did not know what an LPA was and the importance of planning for the future.

Yet there is also the concern around the increase in dementia in the UK. The worry now is that we may be facing an incapacity crisis. As studies of dementia have revealed more, it’s also shown that it can affect the mental capacity in people of all ages, not just the older generation and this is often overlooked.

With an ageing population then dementia is forecasted to rise, but as awareness and research improves we are also seeing that dementia and levels of incapacity can start at a younger age.

As the level of dementia is predicted to rise and the number of ageing people is increasing, then the level of incapacity is set to grow whereby the impact on families, the economy and the healthcare system may be dramatic.

Care costs are predicted to increase to support the rise in support required, and the impact on handling family affairs will be huge, as the number of Health and Welfare Lasting Powers of Attorneys being made is not matching the growth in incapacity.

Households can be affected financially if there is no Financial LPA in place, whereby there could be unable to access funds for a period of time until authorities or the courts provide access. This could impact on mortgage payments, bills and general household finances.

Mental Capacity

It is expected for mental capacity to be more closely scrutinised going forward, particularly for decisions that are made regarding financial and health affairs. This means it is even more important for an LPA to made sooner rather than later. If a relative’s mental health deteriorates and a client tries to get an LPA in place, then it’s likely to be unsuccessful, it will simply be too late by that time.

A focus on Later Life Planning

Later Life Planning is becoming more of a focus for many people, and not just in regards to pensions and investments. But there is an increase in awareness to consider how to protect for the future in regards to all the things we have worked so hard for to provide for ourselves when we are older and our loved ones.

Trevor Cross, MD, BTWC comments “For your clients an LPA is the best way to protect their interests, by making sure they decide (early on) who has the authority to deal with their financial affairs, as well as their health and welfare should they become incapable of doing so themselves.

An LPA can be made on in isolation on its own, but often works best as part of a discussion around later life planning, including looking at Wills, ensuring all affairs are put in order. Making an LPA can sometimes get complicated, and professional advice and guidance is recommended as part of the process. The registration of an LPA can be highly specialised and time-consuming, and at BTWC, with 20 years’ experience, we can provide swift solutions and expert support to help advisers and their clients.”