As we go through life, we often take steps to protect our financial interests. We save money, invest in assets, and plan for retirement. But have you considered what would happen if you were unable to make financial decisions due to illness, disability, or other circumstances? This is where Lasting Power of Attorney (LPA) comes in as a crucial financial failsafe for you and your loved ones.
What is Lasting Power of Attorney?
Lasting Power of Attorney is a legal document that allows you to appoint someone you trust to make decisions on your behalf if you become unable to do so. There are two types of LPAs: one for property and financial affairs, and another for health and welfare decisions. With an LPA for property and financial affairs, your appointed attorney can manage your finances, pay bills, and make financial decisions in your best interests. This can include managing your investments, pension, property, and other financial matters. An LPA for health and welfare decisions allows your attorney to make decisions about your medical treatment, care, and daily activities if you are unable to do so.
Why is Lasting Power of Attorney important?
Provides peace of mind: Life is unpredictable, and unexpected circumstances such as accidents, illness, or cognitive decline can happen to anyone at any age. Having an LPA in place provides peace of mind knowing that your financial affairs will be managed according to your wishes, even if you are unable to communicate or make decisions yourself.
Avoids costly legal battles: Without an LPA, your family may face difficulties accessing your finances and making important financial decisions on your behalf. In such cases, they may need to go through court proceedings to appoint a deputy, which can be time-consuming and costly. Having an LPA in place can help you avoid these legal battles and ensure that your chosen attorney can manage your finances without any hindrances.
Protects your assets: Your assets, including your investments, pension, and property, are valuable and need proper management. With an LPA for property and financial affairs, your appointed attorney can ensure that your assets are protected, bills are paid on time, and financial decisions are made in your best interests.
Provides clear instructions: An LPA allows you to provide clear instructions on how you want your finances to be managed and who you want to manage them. This ensures that your wishes are respected and followed, even when you are unable to make decisions yourself.
How to set up Lasting Power of Attorney?
Setting up an LPA is relatively straightforward, but it's important to work with a qualified legal professional to ensure that your LPA is properly drafted and legally binding. Here are the general steps to set up an LPA:
Choose your attorney: Think carefully about who you want to appoint as your attorney. It should be someone you trust, who understands your values and financial interests.
Fill out the forms: Obtain the LPA forms from the government's Office of the Public Guardian (OPG) or through a qualified legal professional. Fill out the forms accurately, including details about yourself, your chosen attorney, and your specific instructions.
Register the LPA: Once the forms are completed, they need to be registered with the OPG. There is a registration fee, and the process can take several weeks.
Share the LPA: Once the LPA is registered, it's important to share the details with your family members, attorney, and relevant financial institutions, so they are aware of the arrangements in place.
Conclusion
Having Lasting Power of Attorney in place is a crucial step in safeguarding your financial future and ensuring that your wishes are respected, even if you are unable to make decisions.
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