19th NOVEMBER 2020
Many people can find the concept of Lasting Power of Attorney’s confusing and it is easy to see why. They are important but complex documents. Here we will list the most common misconceptions that we come across when advising our customers on LPA’s:
“I don’t own a property so I don’t need an LPA”
LPA’s are not just for people who own a property. They are there to assist your attorneys in managing your bank accounts (and other investments and savings) as well as being able to pay your bills and receive in any benefits or pension payments you are entitled to. Making an LPA is just as important for anyone who doesn’t own a property as for someone who does.
“I am married so I don’t need an LPA as my spouse can take care of everything”
Your spouse will only be able to deal with any jointly owned property such as joint bank accounts. They will not be able to deal with any accounts, investments or property that are held in your sole name. Even if you own a property jointly it will become an issue if your spouse wants to sell it (see our blog “LPA’s and jointly owned property”. Making an LPA is just as important for someone who is married as for someone who is not.
“I am only young! I don’t need an LPA yet”
Unfortunately, situations can occur where our lives are changed in a mere moment. Things like car accidents, sporting accidents, cancer and other illnesses can happen at any time. The Covid19 pandemic of 2020 has demonstrated that even young and relatively healthy people can succumb to viruses of this nature and be put into comas and on ventilators. Making an LPA is vitally important for any person over 18.
“I have a Will so I don’t need an LPA”
Wrong! An LPA is completely different to a will. You need both. An LPA takes effect whilst you are alive when you need people to assist you in managing your affairs. A will only takes effect when you pass away and your executors deal with winding up your estate. Making an LPA is just as important as having a will and in an ideal world you should make both a will and an LPA so that you are completely covered.
“I have an LPA for financial affairs - this means my attorneys can make medical decisions for me”
There are two different types of LPA – one is for financial affairs and one is for health and welfare. If you have an LPA for financial affairs then that will not give your attorneys authority to make decisions regarding medical treatment. If you have an LPA for health and welfare then that will not give your attorneys authority to make decisions in respect of your financial affairs. It is very important to make both LPA’s.