How a Lasting Power of Attorney Might Save Your Family Hassle In The Long Run

We never know what life throws at us, and it’s always good to be prepared for whatever comes our way. As the saying goes, “prevention is better than cure”. Because of Singapore’s ageing population, dementia rates have been on a steady rise, at about an increase of 5% each year. While morbid topics such as death and disease remain taboo in our society, there’s no harm in making arrangements for the unlikeliest of scenarios – which just might save you from unnecessary hassle. Here’s how a Lasting Power of Attorney (LPA) can do that.

What is an LPA?

In the event you lose your mental capacity (the ability to make decisions for yourself), an LPA allows appointed person(s) to act on your behalf. These person(s) must be over the age of 21, should be someone you trust, and likely to live much longer than you are. They will be able to make decisions with regards to your personal welfare and property affairs.

What is the difference between an LPA and AMD?

However, it is important to note that an LPA is not the same as an Advanced Medical Directive (AMD). An AMD is a document you sign when you are mentally competent, informing the medical team that you do not want any extraordinary life-sustaining measures to be taken should you become terminally ill or unconscious. The AMD cannot be overwritten by the donee of your LPA.

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Things to take note of when you apply for an LPA

To apply for an LPA, you need to fill in a form and approach an accredited medical practitioner, lawyer or psychiatrist to issue you with an LPA certificate. While the Office of the Public Guardian has waived LPA application fees until 31 August 2020, you will still be charged for the issuing of the LPA certificate. Rates typically range from $50-$80 for Form 1. Once you have filled in the form and obtained your LPA certificate, you can post the documents to the Office of the Public Guardian, and you’re all set.

Here’s the difference between LPA Form 1 and Form 2:

LPA Form 1: Standard form for donors who wish to grant donee(s) general powers with basic restrictions. Donors may appoint up to 2 donees and 1 replacement donee in LPA Form 1. This comes into play if you wish to appoint different donees to look into two different aspects of your life – namely, personal welfare and property and financial matters.
LPA Form 2: For donors who wish to appoint either more than 2 donees, more than 1 replacement donee, or grant customised powers to their donee(s). The Annex to Section 4 of the LPA Form 2 has to be drafted by a lawyer.

LPA as an important aspect of financial planning

Involving LPA in your financial planning is crucial as not doing so might potentially set you back as much as $10,000. In the unlikely event you lose your mental capacity and do not have an LPA, your family will not be able to make any decisions for you. They will have to apply to the court to be appointed as a deputy. Not only will the legal process cost about $10,000, but they also will not be able to make any investments for you, which they can if you have an LPA.
It’s a lot to take in, and making such decisions can be intimidating. If you have questions or need further guidance, leave your contact with us, and our consultants will bring you through the process step-by-step.

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