Estate planning is about safeguarding your future and ensuring your loved ones are cared for. One critical element of any robust estate plan is a Power of Attorney (POA). This legal document allows you to appoint someone to make decisions on your behalf if you’re unable to do so yourself. However, mistakes in setting up a POA can lead to unintended consequences, potentially jeopardising your wishes and financial security.

Here are the top five mistakes to avoid when including a Power of Attorney in your estate plan—and how to get it right.

1. Choosing the Wrong Attorney

The person you appoint as your attorney (also known as an agent) will have significant control over your finances, health decisions, or both. Choosing someone who is unreliable, inexperienced, or prone to conflicts with other family members can lead to serious issues.

How to Avoid It:

• Select someone you trust completely, such as a close family member, lifelong friend, or professional advisor.
• Consider their ability to handle financial matters or make difficult decisions under pressure.
• Avoid choosing someone solely based on their relationship to you—focus on their qualifications and character.

2. Not Specifying Clear Instructions

A POA grants broad powers, but failing to outline clear instructions can result in decisions being made that don’t align with your wishes. Ambiguities can also lead to disputes among family members.

How to Avoid It:

• Include detailed instructions about how your finances should be managed or your healthcare preferences.
• Use the preferences and restrictions section in the POA form to outline any specific wishes, such as managing investments or selling property.
• Consider attaching a letter of wishes to your POA for further clarity.

3. Overlooking Regular Reviews

Life changes—relationships evolve, financial situations shift, and laws are updated. If your POA isn’t reviewed regularly, it may no longer reflect your current situation or goals.

How to Avoid It:

• Review your estate plan, including your POA, every 3–5 years or after major life events, such as marriage, divorce, or the birth of a child.
• Update your POA if your chosen attorney is no longer the right fit (e.g., they’ve moved abroad, become ill, or had a falling out).

4. Failing to Register the POA

In England and Wales, a Lasting Power of Attorney (LPA) isn’t legally valid until it’s registered with the Office of the Public Guardian (OPG). Some people delay registration, believing it should only be done when the POA is needed, which can create unnecessary delays during critical moments.

How to Avoid It:

• Register your LPA as soon as it’s signed and witnessed. The registration process can take up to 20 weeks, so planning ahead is essential.
• Remember that registering early doesn’t mean the POA will immediately take effect—it simply ensures it’s ready when needed.

5. Ignoring the Scope of the POA

There are two types of LPA in England and Wales:

1. Property and Financial Affairs LPA: Manages your money, property, and investments.
2. Health and Welfare LPA: Makes decisions about your health and personal care.

Many people overlook the need for both, assuming one document covers all areas.

How to Avoid It:

• Consider your needs carefully—financial matters and healthcare decisions often require different expertise.
• Set up both types of LPA to ensure all aspects of your life are covered.
• If you only set up one type, ensure it reflects your highest priority concerns.

Final Thoughts

Including a Power of Attorney in your estate plan is one of the most important steps you can take to protect your interests. However, avoiding these common mistakes is equally critical to ensure your wishes are respected and your loved ones are spared unnecessary stress.

By choosing the right attorney, providing clear instructions, regularly reviewing your POA, registering it promptly, and ensuring comprehensive coverage, you’ll create a solid foundation for a secure future.

💡 Need help with your estate plan? Start today and gain peace of mind knowing your affairs are in order.

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