Data from HUB Financial Solutions showed that one in five customers seeking advice had no will in place for their estate. More than eight in 10, or 84 per cent had no Power of Attorney (LPA) despite the crucial protection it provides in the event of accident, illness or declining health.
The figures are broadly in line with research from HUB Financial Solutions’ parent company, Just Group, which found that 12 per cent of over 75s had no will in place and 70 per cent had not arranged an LPA back in April 2021.
Legal experts and later life lenders in particular say advisers play an important role in encouraging customers to put these legal protections in place to safeguard their interests in later life and ensure their wishes are understood.
The process for those who are incapacitated without an LPA is a legal minefield as the Court of Protection has to appoint a deputy, which delays the ability to make critical decisions about the person’s health and wealth by months and costing thousands of pounds. It is also wise to take legal advice when setting up an LPA as it is a complicated process.
However, many advisers see it as a challenging yet necessary conversation to have with their clients.
Simon Gray (pictured), managing director of HUB Financial Solutions, said: “Financial advisers are well positioned to explain the importance of these legal documents at a time when clients are looking to proceed with significant financial decisions such as accessing a pension or taking out a lifetime mortgage.
“Advisers may also be able to recommend trusted legal partners that specialise in estate planning, and help assess the value of assets in the estate alongside any tax issues the client may be unaware of but want to consider.”
He added: “Married couples assume that if one partner loses capacity then the other can just step in, and children often assume they can pick up matters on behalf of parents, but they won’t have the authority unless a power of attorney is in place.
“It helps avoid situations where family members have to navigate extra obstacles at a time of emotional distress.”
