Scarlett Musson, Business Development Director, APS Legal & Associates
There is now a prompt on the majority of fact find documents to ask your clients whether they have a will but, sadly, there isn’t a similar attention given to asking about lasting powers of attorney (LPA). With so much focus on the ‘ageing population’, and horror stories regularly in the press about the issues caused by not having an LPA in place, the majority of advisers will have it on their radar. If you need any further motivation to make sure LPAs are covered with every client, I’ll give you some reasons of why this is so important; for your client and their family, but also for you and your business.
Imagine for a moment that you’re the client in this situation. If you met with your adviser, having discussed your personal plans and indeed what decisions you are making for the security of your wealth for the future, if they then advised you that they could arrange your will and lasting powers of attorney for you, would you do it? Honestly, I think most of us would. Although it’s often not a pleasant area into which to delve, I’ve often seen a metaphorical (and occasional physical!) sigh of relief from clients after this vital provision is completed.
So, how could it affect you if your clients do not have a lasting power of attorney and will in place?
In a situation where your client loses capacity, their assets will be frozen, even joint ones, meaning that you would be powerless to help the client or their family with any financial matters, during a time at which they might need help more than ever. Any transfer/drawdown of pensions, investments and equity release mechanisms would be put on hold. However, had a lasting power of attorney been put in place, the spouse - or children – of your client could work with you and ensure the client’s financial capacity can be managed. An additional benefit would then be the creation of a relationship between you and the client’s attorneys and, even better, is to bridge the gap to the next generation.
If the client was to pass away without a will in place, they would die intestate; this means that the assets belonging to your client could be transferred to someone they would not necessarily have chosen. By helping them to put a will in place, you are protecting, and respecting, both the wishes and the assets of the client. You can ensure their property, capital and personal belongings are passed to only the people selected by the client, hopefully avoiding any rifts within the family during what is already an upsetting and difficult time.
Completing the will and LPA yourself will allow you to keep close to the client, and ensure that their wishes are carried out. However, advisers rarely choose to be specialists in every area of financial planning and you may opt to outsource to a third party to fulfil the preparation and drafting of the documents.
If this is the route you follow, I’d advise you to check on a few specific areas below choosing a partner with which to work. Firstly, establish that the firm offers a complete drafting service; you need to be entirely comfortable with exactly what you, and your clients, will receive before you begin the process. I would also recommend finding out about the ongoing support you will receive, how PI cover will work and whether a service is available to keep you up to date with any relevant regulatory and legislative changes.
Whether you choose to undertake the administration and fulfilment of the will and LPA yourself, or refer it on to a specialist partner, a discussion on both really should form part of your regular conversations with all of your clients.