Newspaper article The Journal (Newcastle, England)

Be Prepared for the Future of Your Finances

Newspaper article The Journal (Newcastle, England)

Be Prepared for the Future of Your Finances

Article excerpt

"THEY are only for old people" ... "my family will look after me" ... "they are really expensive".

These are just some of the many reasons why most people still think they do not need a Lasting Power of Attorney (LPA).

Unfortunately, most people are not aware that the alternative to an LPA is a costly, time consuming and uncertain court process which comes at the worst possible time, often when a family member has just suffered an unexpected accident or illness.

An LPA is a legal document that allows a person to appoint one or more people, such as a family member or friend, to act on their behalf in relation to their financial affairs. There are two types of LPA - a property and financial affairs LPA and a health and welfare LPA.

An LPA wouldn't normally be called upon until a person can no longer deal with their own affairs.

An accident or illness can strike at any time and LPAs are just as important for people with busy work and family lives as they are for the elderly, especially if you are the owner of a business.

A myth is that families will be able to automatically help you if you don't have an LPA. This is not the case and without an LPA, an application would have to be made for someone to be appointed as your "deputy" before they can have access to your finances.

Whilst LPAs aren't necessarily cheap, in the long run they are far less expensive than having to apply to the court to be appointed as a deputy. Each LPA currently incurs a court fee of pounds 120.

The following case study highlights just some of the damaging effects that not having an LPA can have.

Mark and Sarah are married with two sons. They own their home but have not yet finished repaying their mortgage. They each have their own bank accounts, but there is a joint account from which the mortgage payments and some other household bills are paid. …

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