The importance of preparing for future incapacity has perhaps never been more important. That’s why there’s been a record-setting increase in Lasting Power of Attorney (LPA) registrations. In 2023, there was a 37% rise in the number of LPA arrangements, surpassing one million for the first time, according to the Family Court. This significant uptick underscores a growing public awareness and proactive approach to personal and financial well-being.

Understanding Lasting Power of Attorney

A Lasting Power of Attorney is a legal document that allows you to appoint one or more people (known as ‘attorneys’) to help make decisions or to make decisions on your behalf. This becomes effective if you lose the capacity to manage your affairs due to reasons such as illness, accident, or advanced age. There are two types of LPA:

– Health and Welfare LPA: Allows your attorney to make decisions on things like your daily routine, medical care, moving into a care home and life-sustaining treatment. It can only be used when you are unable to make your own decisions.

– Property and Financial Affairs LPA: Permits your attorney to manage your finances, such as managing your bank or building society accounts, paying bills, collecting your pension or benefits, and selling your home. This can be used as soon as it’s registered, with your permission.

Factors Driving the Increase in LPA Registrations

1. The Covid-19 Pandemic

   The pandemic has prompted many to consider their health and mortality more closely, leading to a surge in LPA registrations. Lockdowns and restrictions provided people with time to reflect and organise their affairs, including preparing for potential incapacity.

2. Earlier Diagnosis of Dementia

   With around 900,000 people currently living with dementia in the UK—a number projected to rise significantly—early diagnosis is becoming increasingly common. This medical prognosis has encouraged a proactive approach to arranging LPAs, ensuring that personal welfare and property matters are handled as wished in case of diminished capacity.

3. Streamlined Online Application Process

   The simplification of the LPA application process with online platforms has also facilitated the increase in registrations. The ability to apply without necessarily having to go through a solicitor has made LPAs more accessible to the general public.

The Importance of Setting Up an LPA

Setting up an LPA is akin to creating a personal insurance policy on your decision-making capabilities. It ensures that should you become unable to make decisions for yourself, your appointed attorney(s) can act on your behalf, thus avoiding unnecessary stress and potentially complex legal battles for your loved ones.

Benefits of Having an LPA:

– Certainty and Reassurance: Provides peace of mind that your affairs and health will be looked after as you intend.

– Avoids Delays: Ensures that there’s no delay in managing your affairs if you lose capacity.

– Reduces Stress for Family: Prevents stressful situations for your family members as they will not have to obtain permission from the court to act on your behalf.

– Financial Management: Helps you continue managing your financial obligations seamlessly.

Final Thoughts

While thinking about losing capacity can be uncomfortable, the dramatic increase in LPA registrations highlights a shift towards more diligent, forward-thinking personal health and financial planning. It is essential to consider setting up an LPA as part of your broader financial strategy, ensuring that whatever the future holds, your wishes and needs will be respected and followed. Consulting with a financial planner or a solicitor who specialises in wills and probate can provide tailored advice and facilitate this process.

Don’t hesitate to prepare for your future and secure your peace of mind with a Lasting Power of Attorney.