Financial advisers in the UK are urging households to consider putting a lasting power of attorney in place, warning that many families misunderstand what happens if someone loses mental capacity. They say the consequences can extend well beyond legal administration and affect day-to-day finances and healthcare decisions.
The warning comes as advisers report that lasting powers of attorney remain widely underused despite growing awareness of their role. Registration currently costs £92, and professionals say delays and complications often emerge only after a crisis occurs.
A lasting power of attorney (LPA) allows a person to appoint someone to make decisions on their behalf if they later become unable to do so themselves. Advisers quoted in recent reporting argued that many people wrongly assume spouses or close relatives automatically gain authority to act.
According to Joe Farmer, co-founder of The Retirement Studio, families often only recognise the importance of an LPA once circumstances have already changed. He said many people believe a spouse or next of kin can automatically manage finances after a loss of mental capacity, but said this is not the legal position.
Families Can Face Financial Disruption without Legal Authority
According to Farmer, families without an LPA may find themselves unable to access bank accounts, manage bills or deal with mortgage arrangements. He described cases where direct debits linked to important household expenses had been cancelled while less urgent payments continued, creating added pressure during already difficult periods.
Farmer also said that people frequently associate LPAs with older age and delay arranging them, despite the possibility that illness or accidents can affect people at any stage of life. He added that some households only learn what an LPA allows when trying to support a relative who has already lost capacity.
Financial planner Graham Nicoll of NCL Wealth Partners shared examples of situations where the absence of an LPA created problems. He said a friend’s mother had been unable to access accounts held in her husband’s name or communicate with a utility provider, which had led to financial concerns and emotional strain.
Healthcare Decisions and Court Processes Highlighted as Concerns
According to Nicoll, one client experienced difficulties when healthcare professionals made decisions about their partner’s care that differed from previously expressed wishes. He said the absence of an LPA meant there was no legal authority in place after the partner lost mental capacity.
Steven Greenall, director of Greenall Estate Planning, said that although many people are aware LPAs exist, far fewer actually arrange them. He noted that being identified as next of kin does not automatically grant decision-making powers.
Greenall also warned that applying to the Court of Protection after capacity has been lost can be both slow and expensive, with potential knock-on effects for rent, mortgage payments and household bills. He said LPAs can be completed without professional help but recommended seeking advice to ensure attorneys are appointed correctly and registration requirements are followed properly. Registration fees currently stand at £92, according to the advisers cited.
