UK adults are putting their finances at risk by failing to set up a lasting power of attorney (LPA). Research by Co-op, the UK’s leading probate provider, has revealed that 80% of those aged over 45 do not have an LPA in place. Of perhaps even greater concern is that two thirds of people aged 75 to 84 haven’t set one up.
An LPA allows an individual to appoint a person they know and trust to act on their behalf in the case of mental incapacity, granting them legal authority over issues like money, property and health. However, the Co-op’s research shows that people are relying on goodwill from relatives to manage their finances, rather than putting in place an LPA.
A quarter of those surveyed had access to the bank account of a relative other than their spouse, to manage their money for them to pay for groceries, holidays and suchlike – something an appointed attorney could do securely and legally.
These informal arrangements increase the risk of financial abuse and can often cause significant problems which only come to light after death.
While the elderly are more susceptible to mental incapacity, the value of an LPA doesn’t only come into play towards the end of life. People can lose their capacity to act at any time, through injury, accident or illness. Someone goes into hospital with an acquired brain injury every 90 seconds, according to the charity Headway.
Please note that advice given in relation to a power of attorney will involve referral to a service that is separate and distinct to those offered by St. James’s Place and is not regulated by the Financial Conduct Authority.