What is the difference between a Will and a Lasting Power of Attorney (“LPA”)?

An LPA deals with decision-making on behalf of the donor who loses mental capacity and can be activated once the donor loses mental capacity. The LPA deals with situations when the donor is still alive, but without the requisite mental capacity to make certain decisions.

What is a Will?

A Will is a legal document that contains instructions on how your property will be distributed and can also deal with the guardianship of any minor children. To ensure that your wishes are executed, you will need a well-written Will encapsulating your intentions and duly signed by you and two other independent witnesses.

Lasting Power of Attorney

A Lasting Power of Attorney (LPA) is a document that allows a person aged 21 years or empower his or her caregiver in the event of mental incapacity. The person making the LPA is referred to as a donor while the appointed person is referred to as a donee. Through an LPA, the donee can be enpowered to take care of the personal welfare (including medical welfare), and also financial matters of the donor.

A Lasting Power of Attorney takes effect from the time a donor loses their mental capacity.

In Singapore, there are two types of LPA forms that a person can choose from.

  1. LPA Form 1 – Prescribed form giving wide powers to the donees.
  2. LPA Form 2 – A blank slate where more specific powers can be granted to the donees, including the appointment of trust companies to manage the property and affairs of the donor. Requires a lawyer to do the drafting.

Why you need a Will?

A Will allows you to make sure that your loved ones are taken care of. In addition, your can choose a trustworthy person to be your executor/trustee of your Will and not leave this appointment ot chance. If you die without a will, a statutory formula will be applied to determine who are the beneficiaries and their respective share of your assets. A clearly worded will can reduce the potential for inheritance disputes.

You can also appoint a legal guardian of your choice to make sure that your minor children are in good hands when you are gone.

Why you need an LPA

If you become mentally incapacitated, in the absence of an LPA, the court would have to appoint a deputy to act and make decisions on your behalf. Obtaining such court orders can be time-consuming and costly. Having an LPA will, however, do away with the need for the court order as you will have already chosen a person to make decisions on your behalf, therefore saving both time and money.

Need to know more?

FortisWills and Fortis Care provide free talks on issues pertaining to Wills and LPA regularly. Some of the topics covered include:

  • Types of assets that can or cannot be included in a Will
  • How to protect your legacy with a Will
  • Who takes care of my minor children?
  • Who should you appoint as your Donee(s)
  • What are the powers given to Donee(s) and the legal safeguards
  • Who will take care of your dependents if something happens to you

 

Please visit http://bit.ly/willsLPA for more details.