3 Reasons Why You Should Make an LPA Today
Author: Patrick Tan and Samantha Lek
- A Lasting Power of Attorney (“LPA”) is a legal document which allows you (the donor) to appoint someone (the donee) to make decisions for your personal welfare and/or property and affairs in the event you lose mental capacity and the ability to make decisions yourself.
- A person needs to be at least 21 years old, have mental capacity to make the LPA and must not be an undischarged bankrupt (if you wish to make an LPA for property and affairs matters). While it may be uncomfortable to think about a situation where you lose your mental capacity, it can happen to anyone. Common instances where a person may lose mental capacity include accidents, the onset of illnesses or old age.
- In this article, we explore three reasons why it is important to have an LPA as part of your Advance Care Planning journey.
It is harder for your loved ones to take care of you
- In the unfortunate situation where you have lost your mental capacity, you would be surprised to find that there are many restrictions on the use of your assets, even if it is by well-meaning family members for your benefit.
- For example, if you were in a coma at the hospital, your spouse and children would not be able to use your assets immediately to pay for your hospital bills. If they approached the banks, the banks would not release your money in your own account to them unless they are the appointed donees of your LPA or the appointed deputies under an Order of Court. This is because the banks are also trying to protect your interests by safeguarding your money.
Your loved ones would have to apply to the Court to be given the power to take care of you
- If you have lost mental capacity and do not have an LPA, your loved ones would need to apply to the Family Justice Courts to be appointed as your Deputy in order to make decisions in relation to your personal welfare and property and affairs. There is no ‘automatic’ power granted to them just because they are your family members or relatives.
- This process can take many months and typically costs a few thousand dollars in legal fees. While waiting to be appointed, your loved ones would remain in a difficult situation where they do not have the authority to make the necessary decisions which are in your best interest. This could add to their financial stress and anxiety.
- If you have an LPA, your loved ones can immediately approach the relevant institutions to carry out transactions on your behalf with your LPA and a Medical Report Form which activates the LPA.
Conflicts may arise between your loved ones because they disagree on what is the best for you
- Different people who love and care for you may not agree on what is the best for your personal welfare and what is the best way to manage your property and affairs. For example, the wife of a person who has lost mental capacity may find herself disagreeing with her parents-in-law over what is best for her husband. If they disagree, who has the final say? Would it be the wife or the parents? Instead of standing strong as a family, their love and concern for you may cause them to argue and disagree with one another as they have different opinions on what is the best for you.
- Having an LPA prevents such conflicts from arising because you would have thought through carefully and informed your chosen donee(s) that you trust him/her/them with the responsibility of making such decisions on your behalf should you lose mental capacity.
- Making an LPA is simple and affordable. There are just 3 steps for making an LPA, which can be found here. We would be happy to assist you with the paperwork required for the LPA and the necessary certification should you choose to make one.
- While you may wish to save some money by not making an LPA, this actually passes the burden and the higher cost of caring for you to your loved ones down the road if you were to one day lose mental capacity. By bearing this cost and inconvenience now, you spare them from unnecessary financial and emotional stress in the future.
Written by: Patrick Tan and Samantha Lek
Download article here.