The number of individuals being given the responsibility to make major financial and health-related decisions on behalf of their friends and family has risen alongside life expectancy, according to law firm Hugh James.
In 2016, a record-breaking 603,150 Lasting Powers of Attorney (LPAs) were registered, up from 525,268 in 2015.
Males born in 1980 can expect to live, on average, to 84.4 years of age, while females can expect to live to an average of 90.8 years.
The government has been campaigning to raise the profile of LPAs and trying to make them more accessible. Application forms and processes have now been simplified and on 1 April 2017 the cost of LPA applications was reduced from £110 to £82.
Hugh James explains that individuals who run their own businesses are particularly at risk if they fail to register an LPA. If they should lose their mental capacity without an LPA in place, their business’ finances could become inaccessible for several months until an individual is appointed by the Court of Protection to carry out decisions for the person in question.
Matthew Evans, head of wealth management services at Hugh James, said: "Not having LPAs in place is, put simply, taking an unnecessary risk. The figures suggest people are becoming increasingly aware of this.
"Even a small hiatus in managing an individual’s financial affairs can cause a lot of disruption. Where a business is concerned – this could mean trading may need to cease all together. It could also lead to large fines being incurred due to unpaid bills or suppliers chasing for payment. Similarly, if an individual has major commitments – such as a mortgage, for example – then their finances being inaccessible for any extended period of time could be extremely damaging."
LPAs were first introduced in the UK in 1985 as Enduring Powers of Attorney (EPAs). EPAs only granted financial legal authority and were replaced in 2007 by LPAs to include health-related legal authority.