The Importance of Lasting Power of Attorney

(While this article is aimed at financial advisers and accountants, it contains some useful nuggets for anybody considering making an LPA).

In today’s competitive financial landscape, it is crucial for financial advisers and accountants to stay updated on important legal matters that can impact their clients’ financial well-being. One such area is Lasting Power of Attorney (LPA). This article aims to provide valuable insights and information on LPAs, specifically tailored for financial advisers and accountants in England.

Safeguarding Your Clients’ Financial Future with Lasting Powers of Attorney

When it comes to mental capacity, age is not the sole factor. In fact, anyone can face a situation where they are unable to make decisions due to a loss of mental capacity. This reality was recently highlighted by Money Saving Expert Martin Lewis when he advised a healthy 25-year-old to have an LPA in place, and to get it done by a professional. As financial advisers, you play a critical role in guiding your clients through their financial journey. While you diligently plan and strategise for their financial future, it is equally important to address the crucial aspect of Lasting Powers of Attorney.

Understanding Lasting Powers of Attorney

Lasting Powers of Attorney are legal documents that grant designated individuals, known as attorneys, the authority to make decisions on behalf of another person, known as the donor, in case they become incapable of doing so themselves. There are two types of LPAs: Property and Financial Affairs LPA, and Health and Welfare LPA.

Preserving Financial Control through LPAs

By having a Property and Financial Affairs LPA in place, clients can empower themselves to protect their financial interests. In situations where illness, accidents, or old age lead to incapacity, appointed attorneys can manage clients’ financial affairs efficiently. This includes tasks such as bill payments, investment management, and ensuring business continuity. Without an LPA, important financial decisions may be delayed by a Court of Protection application or left unmade, potentially causing financial difficulties and leaving assets vulnerable.

Ensuring Personal Welfare with LPAs

A Health and Welfare LPA allows clients to grant attorneys the authority to make decisions about their medical treatment, care, and daily routine. By having this document in place, clients ensure that their preferences regarding medical interventions, living arrangements, and quality of life are respected. LPAs help avoid potential disputes among family members and provide clarity for social services and doctors during challenging times.

The Professional Advantage of Engaging an LPA Specialist

While clients may consider completing LPAs independently, the expertise of a professional in this process is invaluable. Here’s why financial advisers and accountants should recommend professional assistance for LPAs:

1. Expertise and Legal Knowledge: LPA specialists possess a deep understanding of the legal requirements and complexities surrounding these documents. They can provide accurate guidance tailored to each client’s unique situation.

2. Mitigating Errors and Omissions: Incomplete or improperly executed LPAs can lead to legal complications and render the documents invalid. LPA specialists ensure that all necessary details are included, signatures are obtained correctly, and the documents are legally sound.

3. Personalized Advice: LPA specialists help clients identify potential risks, anticipate future scenarios, and advise on the most appropriate choices for attorneys. They offer an objective perspective to ensure the client’s best interests are protected.

4. Bespoke Clauses: LPA specialists can draft clauses that provide attorneys with advantageous powers, such as controlling online accounts and digital assets, expressing views on gifting for inheritance tax purposes, and clarifying views on life-sustaining treatment.

5. Certificate Provider Role: LPA specialists can act as Certificate Providers, countering any future arguments about a lack of capacity when the document was created.

Embrace the Benefits of LPAs for Your Clients

There are numerous reasons to encourage clients to establish LPAs, with few reasons not to. If you would like us to provide

advice on how LPAs relate to your clients’ specific situations, please don’t hesitate to get in touch. Click here for further information.