Planning for the unexpected: Protecting more than your wealth

Effective planning is not simply about protecting wealth. It is about protecting your ability to make choices, maintaining continuity for your family and business, and ensuring that the people you trust can step in when needed. By putting the right arrangements in place early, you can help safeguard your lifestyle, your loved ones and your future.

Attitudes to estate planning, structuring your affairs sensibly and preparing the necessary legal documents in the event of incapacity or death vary across the world and, even within the UK, between different generations, cultures and backgrounds. However, in all cases, it is wise to consider these matters in advance, ideally without the added stress or pressure of ill health, impaired functioning, or tight deadlines.

Whilst many people understand the importance of having a Will, fewer appreciate that a Lasting Power of Attorney (LPA) may be the document they are most likely to need. Unlike a Will, which takes effect after death, an LPA allows trusted individuals to support you in making decisions, or make decisions on your behalf, during your lifetime if you are unable to do so yourself. It is therefore one of the few planning tools that you can directly benefit from during your lifetime.

Equally, an LPA is not the preserve of the elderly.  Such documents are advisable for anyone to have in place, as they protect your wishes whether you suffer mental incapacitation or indeed physical incapacitation.  Just one example of this is the sad events during the COVID-19 lockdown, where several people of all ages suffered from long-COVID and were physically unable to deal with their financial affairs.  In such instances, an attorney appointed under an LPA could step in to deal with the relevant financial institution in their place.

There are two types of LPA. A Property & Financial Affairs LPA allows your attorneys to manage matters such as your property, bank accounts, pensions and investments. A Health & Welfare LPA enables decisions to be made about your care, where you live, and, if you choose, whether life-sustaining treatment should be accepted or refused.

Property & Financial Affairs and Health & Welfare LPAs are separate documents, and each adult in the UK can prepare one or both types. In fact, it is possible to have more than one of each. This is particularly relevant for business owners and company directors, who often benefit from having both personal and business LPAs in place.

For instance, family members are often well placed to manage personal financial matters such as the family home, savings, investments or pensions. In contrast, trusted business partners or professional advisers may be better suited to oversee business-related financial affairs, helping to ensure continuity, make key decisions and maintain operations in the event of a sole director’s incapacity.

The harsh reality is that, without appropriate authority in place, a business may face delays in accessing accounts, approving transactions, paying employees or making key operational decisions if a business owner unexpectedly loses capacity. This distinction becomes even more important in highly specialised businesses where sector knowledge and expertise are critical to ongoing success.

Property & Financial Affairs LPAs are also an important consideration for non-long-term UK residents holding UK-based assets, particularly where property or investment portfolios are involved.

A Will remains an equally important part of a well-structured estate plan. The law in England and Wales allows freedom of testamentary disposition, meaning individuals are generally free to decide who should inherit their assets on death and on what terms. A carefully drafted Will can set out who should inherit, in what proportions, at what age and, where appropriate, for what purpose.

Without a valid Will, the statutory intestacy rules apply and often produce outcomes that individuals would not have chosen themselves. These can include providing less than expected to a spouse, failing to recognise unmarried partners or cohabitees, or allowing children to inherit substantial sums at age 18.

In practice, we often see significant life events prompting individuals to put plans in place. These may include the birth of a child, the purchase of property, marriage, divorce or the loss of a close friend or family member. However, waiting for a trigger event is not always the most effective approach.

At Greenwoods, many individuals and families choose to create LPAs once all their preferred attorneys have reached 18. For example, a husband and wife with two children may appoint one another and their children in their preferred arrangement once the youngest child reaches adulthood. Attorneys must be over the age of 18, as they are required to formally accept the appointment by signing the LPA.

However, there are often compelling reasons to put LPAs in place much earlier. This may include business owners focused on succession and continuity planning, frequent travellers, individuals with complex investment portfolios requiring regular oversight, or those who participate in higher-risk activities and sports.

For some families, the importance stems from the potential impact of incapacity on a vulnerable dependent. For others, it may be because the majority of family assets or income-producing investments are held in one person’s name.

Planning can also provide reassurance for those with a family history of degenerative conditions such as Parkinson’s disease, helping to ensure that practical arrangements are already in place should they ever be needed.

Whatever brings you to consider estate planning, the underlying objective is the same: protecting the people, lifestyle and values that matter most to you. The advice you receive should be bespoke, pragmatic and effective, delivering solutions that remain fit for purpose over the long term and provide confidence rather than complexity.

Life rarely follows a predictable path. By putting the right plans in place today, you can help ensure that your wishes are respected, your loved ones are supported, and your business remains resilient, whatever the future may bring. Many people find that once these arrangements are in place, they gain a genuine sense of clarity, reassurance and peace of mind.