What is a Lasting Power Of Attorney (LPA)?
A Lasting Power of Attorney (LPA) empowers someone you trust to manage your financial affairs FOR YOU (including your assets) in the event you lose the ability to do so for yourself.
In a simple situation, your parents can donate to you or your siblings (if you have) this right to manage.
LPAs in Singapore are administered by the Office of the Public Guardian.
Without an LPA, if your parents become mentally incapable, you would need to undergo the troublesome and expensive process of applying to the court to allow you to manage their financial and personal affairs.
LPA vs Will, what's the difference ?
A LPA are often confused with a Will.
A Will is used for someone to express his/her wishes as to how the property and assets are to be distributed at death.
On the other hand, a LPA is to plan for unforeseen circumstances like stroke, dementia , coma etc where the person is not mentality capable to make his/her own decision.
These are conditions for a CI claim.
This document is used as to administer any usage of their finances and property.
How to apply for LPA?
Step 1
Step 2
Step 3
Step 4
Step 1: Find a trusted, eligible person who is willing to serve as your done
Step 2: Complete Form 1 or Form 2, including signatures from you and donee
Step 3: Get your LPA signed-off by a LPA certificate issuer. Not all doctors can sign off. It must be an accredited medical practitioner, lawyer or psychiatrist.
Step 4: Submit your application and accompanying documents to the Office of Public Guardian. If no valid objections are received in the next six weeks, your LPA will then be registered and be legally-recognised.
If you wish to make an LPA Form 2, visit a lawyer* to draft the Annex to Part 3 of your LPA.
What is the difference between an LPA Form 1 and LPA Form 2?
LPA Form 1 - Standard version that donors use to grant donees general powers with basic restrictions.
LPA Form 2 - For donors who wish to grant donees customised powers. The annex to Part 3 of the LPA Form 2 has to be drafted by a lawyer*.
*Note: This refers to a Singapore solicitor qualified to practice Singapore law in a Singapore law practice.
98% of Singapore Citizens who have made an LPA used LPA Form 1
Why is the best time to apply your LPA now!
The Office of the Public Guardian (OPG) will extend the waiver of the application fee of $75 for the Lasting Power of Attorney (LPA) Form 1 until Aug 31, 2020
(You'll still need to pay a doctor or lawyer to certify your application).
For Form 2, the application fee is $200.
In 2018, dementia has affected 50 million people worldwide.
Locally, according to the Well-being of the Singapore Elderly (WiSE) study one in 10 people aged 60 and above may have dementia.
Even if you are younger than age60 today, dementia is something that can still affect you.
Critical illness claims on the rise and how LPA comes in
Recently, I was looking at statistic on critical claims made over the past few years.
My colleague's blog post here "Claims over 8 years" shows the total claims by NTUC Income. Critical illness payouts are rising fast.
If you are down with critical illness such as stroke or coma, yes you can claim a big sum out from your Critical illness policy.
But everything you own may become frozen because you are not mentally capable of authorising anything.
Hence, will the money from your insurance claims NOT become of any use?
This is where the LPA can help you are sort out such a scenario.
Quick tip for you: Children to act jointly
I got my mum to do the LPA using form 1.
My suggestion was for her to appoint me and my siblings to act jointly.
In such an arrangement, there will balance and checks to decision making powers given from the LPA because we would have to act in agreement.
Agree?
You can suggest it for your parents or do this approach if your children is old enough.
To read more, I'd recommend these 3 sites
Take care, hope the ideas helped.
Last updated on February 10th, 2019 at 01:33 pm