STEP urges people to ensure that planning for their financial future has been ticked off the lockdown to-do list
STEP, the global professional association for practitioners who specialise in family inheritance and succession planning, today urges families to take precautions and avoid putting off difficult decisions about their finances as England enters the final two weeks of the second national lockdown.
At this time of uncertainty, it is more important than ever to ensure that provision has been made in case you or a close family member becomes ill or incapacitated. Talking about these issues can be uncomfortable, and it is understandable that many put decisions off. But acting now can bring reassurance to individuals to clarity to their families.
STEP today outlines three things people should consider before lockdown ends: Lasting Powers of Attorney (LPA), making a will, and identifying and making provision for your digital assets.
Emily Deane, Technical Counsel at STEP, said:
'With the current situation looking so unpredictable, we are encouraging people to think carefully about the future and seek professional advice if needed. By taking action now, families can avoid serious problems for their bereaved relatives further down the line.
'Lasting Powers of Attorney, for example, are an important precaution vulnerable people should take if they are at risk of becoming incapacitated by illness and therefore need to make provision for their property and financial affairs as well as their health and welfare.
'STEP also encourages people to write a will. Doing so is all too easy to put off but provides comfort to many people and clarity to their families once completed. We now recommend including your digital assets in your will just as much as traditional assets.
'At the present time, people may be worried about social distancing, but LPAs can be set up through an adviser while continuing to observe the official guidelines. Wills, meanwhile, can be witnessed by video conference if necessary, following a change in the law in August 2020.'
- Lasting Powers of Attorney (LPAs)
LPAs have a crucial role to play in looking after vulnerable people, including the elderly and those with medical conditions. However, they need to be created with care and understanding by all of those involved.
With the pandemic so unpredictable – and the risk that vulnerable individuals can quickly become incapacitated – it’s important to have an LPA in place to enable a trusted attorney(s) to take decisions regarding their health and welfare and/or finances and property.
STEP encourages people to make an LPA as a precaution during this crisis; you can still do so while observing rules on social distancing, self-isolating and shielding:
- The signing and witnessing of the LPA can be done via the post or, if you live within walking distance, you could take the LPA to the people who need to sign – whilst keeping at least two metres and washing your hands before and after handling the LPA.
- Witnessing the donor and attorney’s signatures can be done by a neighbour on the doorstep, over the garden fence or through a closed window.
- Families need to plan carefully and collaboratively, and individuals should not underestimate the responsibility bestowed upon the person acting as attorney. Careful consideration and diligent planning are needed to help ensure that they are the right person for the job, have the individual’s best interests at heart and will respect the values they hold.
- Making a will
Many people do not realise the real problems that failing to write a will can create for bereaved relatives. They often procrastinate, which can cause issues should they die unexpectedly, including intestacy, higher fees and tax bills, and increased risk of disputes.
Discomfort with making a will can be an underlying issue that a professional can help with. People usually feel reassured once they have written a will, and it can bring clarity and comfort to families. STEP recommends using an experienced professional to make sure your will is drawn up properly.
It will typically cost a few hundred pounds and bring peace of mind with the knowledge that your will is constructed in the way you want, free of technical mistakes that could otherwise lead to expensive and upsetting family disputes after death.
Wills can now be witnessed by video conference following a law change in August 2020. This enables them to be drawn up efficiently and effectively even if you are self-isolating – though STEP recommends only choosing this path if there is no other option.
- Remember your digital assets
The pandemic has accelerated the move online in many areas of our lives and STEP now places extra emphasis on urging people give thought to their digital legacies and make provision for non-physical assets in their will.
From sentimental items you want to pass on like digital photos and social media content; to highly private information like confidential emails, passwords and medical records, these items are now just as important to our lives and identities as traditional non virtual assets – but many of us neglect to plan for them appropriately.
Family members need to manage loved ones’ affairs after their death so must have access to financial and other information stored on computers and online cloud services. But they may not even know about all the accounts that exist, let alone have access. Rather than leaving them guessing at passwords, STEP recommends taking a number of measures so that control can be handed over when the time comes:
- Make a detailed inventory of your digital assets – cloud files, shopping accounts, storage drives, online identities – so your executor knows where to find them.
- Appoint a representative - someone you can trust if you lose mental capacity or die
- Tell them what you want to do and achieve, and make sure they know how to access your accounts and passwords
For more information on any of these issues, or to request an interview with Emily Deane, please contact:
- Caroline Merrell, Nick Reading, or Claire Dansie at Citigate Dewe Rogerson: 020 7638 9571
STEP is the global professional association for practitioners who specialise in family inheritance and succession planning. STEP works to improve public understanding of the issues families face in this area and promotes education and high professional standards among its members. STEP members help families plan for their futures, from drafting wills to issues surrounding international families, protection of the vulnerable, family businesses and philanthropic giving. Full STEP members, known as TEPs, are internationally recognised as experts in their field, with proven qualifications and experience.