LPAs and investing

A recent article in a financial newspaper reports that many LPAs should, but do not include an explicit instruction to outsource investment advice. This omission will pose significant problems for the attorneys, put at risk the donor’s assets, and make LPAs far less efficient than they should have been.

There is also an increase in the number of attorneys wanting to make decisions about money or property but the donor’s financial adviser feels it is not in his/her client’s best interest. Understandably, this has forced some advisers to disengage from their client and to report their concerns to the Court of Protection, an outcome that can only increase problems for the family.

This reflects two major failings with LPAs that we have been shouting about for a long time. Namely, LPA creation treated as a mere form-filling exercise; and that the vast majority of attorneys have little or no knowledge of the role they volunteered for. No surprise then, that more attorneys are attempting decisions beyond their legal remit.

Fortunately, Life Planning clients will avoid both problems. We provide the most comprehensively completed LPAs bar none. In addition, all our client’s attorneys get a free copy of our Attorneys Guide. This is the only Attorney ‘educator’ in the UK, and is now helping many acting attorneys avoid the usual pitfalls and problems. These attorneys will at least know what to do when it comes to investing!

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Not Having LPAs Can Speak Volumes

For a Court or medical team to determine the wishes of an incapacitated adult is far from easy, and they will examine all possibilities.

In the absence of any written instructions or wishes it used be the case that they would speak to other family members. This however can be very be counter-productive and unreliable. Families often disagree among themselves as to what their mum or dad would have wanted. There is also the possibility that some family members may have their own hidden and sinister agenda as to what treatment dear old mum should or should not receive!

Fortunately, today there does exist a very powerful and persuasive form of evidence available to a Court or medical team and that is the absence of Lasting Powers of Attorney (LPAs).

LPAs are now widely known and easily available, which might well justify the conclusion that their absence clearly indicates the patient’s wishes. No LPAs of any kind sends the message that the patient does not want their family to make any decisions on their behalf, financial or medical. Whilst having just an LPA (property) and you want your family to make financial decisions for you but not medical ones!

Even if there is the faintest possibility of such an occurrence, and you really don’t want to create problems for your family should be reason enough to make sure that you have LPAs in place …. just in case.

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The Greatest Fear

The greatest fear now for the over 55s, is no longer cancer but the prospect of losing their mind. It appears that one in four of the general population is more concerned about developing dementia than any other condition.

There are 850,000 people with dementia in the UK, with numbers set to rise to over 1 million by 2025. This will soar to 2 million by 2051.

225,000 will develop dementia this year, that’s one every three minutes.

Up until his death best-selling author Terry Pratchett, a victim of early-onset Alzheimer’s, was a patron of the Alzheimer’s trust. He said: ‘I’d like a chance to die like my father did – of cancer, at 86. Remember, I’m speaking as a man with Alzheimer’s, which strips away your living self a bit at a time.’

Amazingly, before he went to spend his last two weeks in a hospice he was bustling around the house, fixing things. He continued communicating with others right up to his last few days, knowing who they were, and who he was.

greatestfearFor many other dementia victims it’s a different story as they lose the ability to make any rational decisions for themselves. When this occurs a family can find a great many more problems descend upon them, especially if there are no LPAs in place.

If looking after the daily needs of a dementia sufferer were not difficult enough, the family would also face a financial nightmare caused by frozen assets and bank accounts. To try and ‘undo’ this situation they will have to apply to the Court of Protection (CoP).

A CoP application is not cheap, but where will the money come from to fund the application, when even joint bank accounts and savings are frozen? Typically it is sons and daughters who come to the rescue; which only adds to the families stress levels.

When incapacity strikes, LPAs can prevent more problems, save more money and resolve more issues than just about any other solution available to the family. After all, if you are caring for a loved one with any form of incapacity the last you need is the extra stress of dealing with solicitors and a Court application!

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Lasting Powers of Attorney, and Court of Protection …. myths and harsh realities

Probably the most common misconception regarding property and cash is that a spouse can continue to operate a bank account that is in joint names, after his/her partner has lost capacity.

If it’s not to breach the Mental Capacity Act (MCA) and its own rule-book the bank has no choice but to freeze the account(s) in question. They can only allow access to a named person or persons under a court order, or a registered LPA that cites they have the authority to act as the deputy for that person.
Considering the financial mayhem that will result from frozen bank accounts would you want to risk being without a Property LPA?

No LPAs and applying to the Court of Protection (CoP) for Deputyship:
The Court very rarely grants deputyship for health and welfare to a family member, and does so only in extreme circumstances where no resolution can be reached that is in the best interests of the person.

When the CoP does appoint a deputy to make continuing decisions about someone’s health and welfare it is where regular treatment or supervision is needed, for example with a younger person. The Court takes the view that if these types of decisions are to be in the person’s best interest it should be by those medically qualified to provide care and/or treatment, which very often is not the family.
Remember also that the family, spouse or next of kin have no legal right or authority to make or be involved in health or medical decision for any adult family member aged 18 or over.
Conclusion: If you prefer to know that someone you trust can intercede on your behalf regarding your medical treatment you need to arrange a LPA (health & welfare) now whilst you have the ability to do so.

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