New research from Quilter, the investment platform and financial adviser, has found that fewer than one in three (29%) well-off baby boomers have registered a lasting power of attorney (LPA).
These findings are despite many of this generation having fears for their long-term health and wellbeing. Just half (50.6%) of respondents were confident they would not require long term nursing care during their lifetime.
Meanwhile new data obtained by Quilter via a Freedom of Information request to the Ministry of Justice reveals that LPA registrations remain 18.8% below pre-pandemic levels. The period April 2021 to February 2022 saw 653,472 compared to 804,589 for the period April 2019 to February 2020. Positively, registrations are 14.8% up on the prior year, which had seen a rapid 30% drop due the disruption to the process for applying for a LPA as a result of the Covid-19 pandemic.
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The government has taken steps to bring LPAs into the digital age, to make the process as seamless and efficient as possible. However more needs to be done to raise awareness of the importance of registering an LPA before it is too late.
There are two types of LPA, health and welfare or property and finance. It is vital when you are putting an LPA in place that you consider who is the most appropriate person or people to be appointed as your attorney(s).
The lack of LPA take up among baby boomers is particularly concerning. Age UK’s ‘Later Life in the United Kingdom 2019’ report states that in the next 20 years, the number of individuals with complex care needs is projected to increase as a result of more people living to 85 years or more, and these individuals having higher levels of dependency, dementia and comorbidity.
This adds to growing concern that people are not planning ahead or considering what would happen to them or their finances if they were unable to express their views due to an accident, medical emergency or cognitive impairment.
Shaun Moore, tax and financial planning expert at Quilter says:
“Putting an LPA in place is a vital part of financial planning and often one of the first things a financial adviser will recommend for a client, yet the number of LPAs registered for those approaching later life remains worryingly low.
“Last year, we were pleased to see the government launch a consultation on modernising LPAs. The process must be streamlined so we can remove any barriers to registration.
“The government is set to share its response to the consultation imminently, but in the meantime, government must continue to increase awareness of the benefits of LPAs and support people to set one up sooner rather than later.
“Some people believe that setting up an LPA will leave them vulnerable and choose not to set one up, but this is not the case. Additionally, many people only associate having an LPA with older people and therefore believe they do not need to think about it yet, but this is the very reason they should have one in place. An LPA can provide clients and their families with the peace of mind that their wishes will still be carried out should they lose the capacity to do so themselves.
“Having an LPA in place now provides protection for the future and helps avoid the risk that they leave it too late. A financial adviser can provide a pillar of professional support to help guide people through the process of setting up an LPA to ensure that they are protected should the worst happen.”