Around 31 million British adults have no will according to a recent survey by Which?
There is a regional split of those without a will – 42% of adults in England say they have a will, 35% in Wales and 31% in Scotland. The reasons quoted for not having a will are pretty varied but often revolve around a lack of understanding of the intestacy provisions and a belief that the individual doesn’t have enough money or other assets for a will to be necessary. Many people also don’t like to discuss the issue of death and so also avoid discussion around writing a will.
While dying intestate can cause many problems for those left behind, it’s fair to say that it doesn’t impact on the deceased. And this lack of a direct consequence of inaction may also contribute to the fact that so few people have taken the trouble to write a will.
But there is another legal document, often called a living will, which does impact directly on the individual who sets it up. According to figures for the end of 2016, less than 4% of the adult population of the UK have set up what is properly called a ‘Lasting Power of Attorney’ (LPA).
The LPA is designed to allow an individual (known as a donor) to appoint, in advance, another person, the ‘Attorney’ to look after their affairs should they become unable to do so themselves due to mental impairment. In England and Wales, there are two types of LPA, one deals with Property and Financial affairs while the other deals with Health and Welfare. The Scottish system is similar and also has 2 types of agreement while in Northern Ireland there is no arrangement to provide for Health and Welfare decisions.
LPAs are important (Enduring Power of Attorney (EPA) in Northern Ireland). Without them there is nobody who has an immediate right/duty to manage an individual’s affairs.
As an example, a Property and Financial LPA (or equivalent) will allow the attorney to deal with the donor’s:
- Bill payments
- Bank etc accounts
- Collection of benefits and pensions
- Property sales etc
While a Health and Welfare LPA, or Welfare Power of Attorney in Scotland, allows the Attorney to make treatment etc decisions on behalf of the donor around:
- Activities of daily living (washing, dressing, eating etc)
- Medical care
- Moving into a care home
- Life sustaining treatment, etc
An LPA can be vital if you hold joint assets as the assets may not be able to be sold without a court order appointing a ‘deputy’ if you lose your mental capacity without a valid LPA. Anyone over 18 can apply to become a deputy, providing nobody objects to their application, and they have the necessary financial experience if they’ve applied to be a ‘property and financial affairs’ deputy.
A deputy’s powers are much more limited than those of an Attorney who has been appointed under an LPA, and they must pay an annual fee to renew their deputyship.
Obtaining a LPA, or equivalent is a straightforward and inexpensive process which makes the current low take up especially strange.
To find out more about this subject, please contact an adviser.