Many of the region’s professionals are unwittingly putting family members at risk of extreme financial hardship by failing to plan for ill health, according to a leading solicitor.
John-Paul Dennis, partner at Kirwans law firm, said the Private Client team has seen an increasing number of enquiries from people whose loved ones have failed to put a Lasting Power of Attorney (LPA) in place before losing mental capacity through conditions such as dementia.
According to John-Paul, those especially vulnerable include partners and spouses who can be left temporarily unable to access even joint bank accounts if their partner has not given them legal authority to look after their financial affairs.
Family members, who may by this point be their loved one’s carer, can then face their own financial problems as they begin the costly and expensive exercise of navigating the legal system in order to access vital funds.
John-Paul’s warning comes during National Carers Week, which runs until June 17, and aims to highlight caring and the challenges carers face.
He said: “Despite the warnings, people are still putting future financial planning on the backburner, putting their loved ones and potential future carers in an extremely vulnerable position.
“The problem is now exacerbated by the newly permitted drawdown of pensions, as the responsibility of managing income in retirement now lies entirely in the hands of those who have chosen the drawdown option.
“While drawdowns can work well for those who have full mental capacity, they can create huge issues if ill health strikes.
“Despite that, more than 345,000 of those using income drawndown in retirement have failed to create an LPA to safeguard against the loss of mental capacity. Unfortunately, this isn’t something that can be put in place after you lose mental capacity; it has to be created well before that point.”
John-Paul is now calling on people as young as 40 to invest in an LPA to protect their loved ones as much as themselves.
“There are two types of LPAs; one covering health and welfare, and the other covering property and financial affairs, and you can make an LPA for one or both depending on your needs.
“During National Carers Week, we’re urging people to take the time to consider the possibility that they may eventually need to have an LPA in place, and create one now before it’s too late.”