Lets Talk About the Hard Stuff
Shockingly only 4 in 10 people in the UK have a Will, and a much smaller number of people have a Lasting Power of Attorney. We can only speculate why this is, but it probably comes down to our reluctance to talk about death/serious ill health and the persistent myth that you don’t need one.
Both documents are simply a way to let your loved ones know what your wishes are. In the event of your death or an accident/illness that renders you incapable of making decisions, it is important that you have laid out some guidance.
In the case of a will, this is who will oversee decisions, who will receive your money and even who would look after any children you have. In the case of a lasting power of attorney, it is who can act/advocate on your behalf and what decisions you would like them to make about the quality of care you might need and what medical interventions to agree to or refuse.
In the absence of these documents, it is left to the courts to decide, and your loved ones will find themselves navigating a complex, slow and costly process.
Some people assume that without a will everything passes to their spouse or partner on their death. Anything jointly owned does, but any individually owned items such as cars, cash and ISAs will not necessarily. If you are not married or in a civil partnership, then your partner will not automatically receive anything. If you are married or in a civil partnership, then there is an order of beneficiaries named in the intestacy rules which won’t necessarily direct the money to the people you would wish.
We have first-hand experience of seeing the intestacy rules pass an entire estate from a young adult back up to her parents who were our clients and already desperately trying to reduce their estate for inheritance tax purposes. We have also experienced a wife and mother die prematurely and only some of her money pass to her husband, the rest going into trust for her young daughter.
As we said earlier, if the take-up rates of wills are worrying then the same rates for Lasting Powers of Attorney are really poor.
In some ways a Lasting Power of Attorney (LPA) is even more important because it controls what happens to you when you are still alive. We have seen clients of all ages who have ‘lost capacity’ and it is terrible to think that without an LPA people have to act for them without really knowing their wishes.
There is a ‘This American Life’ podcast about an end-of-life care nurse, who due to what she saw in her day-to-day work, insisted that she didn’t want to be resuscitated at the end of her own life. Resuscitation can be pointless in some cases for the patient and very distressing for the relatives as I know from my own family’s experience. This nurse sadly developed ALS or Lou Gehrig disease in her early forties and her husband was clear on her wishes as she had recorded them. When they got to the hospital at the end of her life, he expected her to refuse any life sustaining treatment but faced with death, she changed her mind and was able to communicate that she wanted to gain whatever few hours the doctors could buy her.
Now imagine not being able to communicate that this was your wish. This is what an LPA protects you from. Like the nurse, it is hard to know how we will feel when faced with a loss of capacity, but it is worse if those decisions are left to medical professionals or court appointed deputies who don’t know us from the next person.
Loss of capacity can come at any point in time, from an accident or illness that doesn’t kill but does impair us. It becomes more likely as we age, but it is important that everyone has these crucial documents.
An LPA once complete is registered with the Court of Protection and just needs a medical professional to certify loss of capacity and then it can be used. You can include a power for people to act earlier (a general power) and this can be useful if you happen to be travelling overseas for instance and something needs to be done in your absence.
There are two LPAs one for Finance & Property and one for Health & Welfare. Often clients will appoint different attorneys for each as they may have one child who is good at handling the money and one they trust to make the right decisions about care.
You can appoint multiple attorneys and include non-attorneys that you would like to be informed of anyone acting under the power of attorney. Your attorneys can be set-up to make joint decisions requiring all to agree or jointly and severally, allowing them to sign-off individually on decisions. You can also give instructions to your attorneys (that they have to follow) or guidance.
All of this is avoidable and need not take a lot of time or money.
For our clients we include the drafting of these legal documents (using a third-party company) as a part of our service and charge a small fee to cover our costs. Only our existing clients can access this service as it is not a profit-making service for Altor. This is efficient because we already know most of the information that is required for these documents and in many cases know or advise the wider family members.
Many of our clients have more complex needs for example, overseas assets or the need for complex family trusts and in these cases, we work with a handful of very experience law firms to take care of this for them.
We have had the privilege of advising many of our family clients for 10+ and in some cases 20+ years and they trust individuals within our firm to be the independent executor and trustee of their wills. In this case we will always make sure to avoid conflicts of interest by having this be a separate person to the individuals advising the family.
Simple legal work is available for a small additional fee to Altor clients in our Core, Discounted and Family Services.
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