Practicalities of Estate Management

Practicalities of Estate Management

Practicalities of Estate Management
Practicalities of Estate Management 1

Written by Sebastian Elwell

October 17, 2020

Estate Management

Beyond purely financial planning matters, the practicalities of managing the estate of a deceased loved one can be overwhelming.  Are there services out there that can help with sorting and distributing possessions?  I caught up with Claire Potter, founder of Blue Door Bespoke to discuss her service.  Claire kindly agreed to provide the following guest blog.

 

 

 

 

Practicalities of Estate Management 2
Practicalities of Estate Management 3
Practicalities of Estate Management 4
Practicalities of Estate Management 5

I started Switchfoot Wealth to offer financial planning that matches the way we live and work today. Using the best technology and offering expertise gained through both formal qualifications and years of working closely with clients, we are bringing financial planning into the 21st century, helping people, businesses and professional advisers make the most of their time and their money.

– Sebastian Ewell

Switchfoot Wealth Founder

Read more about Switchfoot Wealth

Related Articles

Collaboration: Cash Flow Planning & Business LPAs

Collaboration: Cash Flow Planning & Business LPAs

It can be difficult for healthy clients to imagine being unable to make decisions for themselves. Even clients who are acting as attorneys for parents or are carers often think it won’t happen to me.

But drawing up a Lasting Power of Attorney is fundamental to good financial management and providing clients with the care they’ll need in difficult times. We must persuade clients to put one in place before it’s too late.

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting

We believe that cash flow planning is an essential part of private client work – for financial advisers, accountants and solicitors alike. Understanding its importance means we can give better advice and that in turn allows our clients to make the most of what they have.

The perils of deliberate deprivation and why a cashflow plan matters

The perils of deliberate deprivation and why a cashflow plan matters

There are many legitimate reasons why people may want to make large gifts: for example, inheritance tax planning, supporting family members or ‘balancing up’ previously unequal gifts to family. When planning gifts, it is important that individuals take advice and document objectives and the effect of the gift, which can help protect them from an accusation of ‘deliberate deprivation’ in the future. Cashflow planning can help in this instance

SwitchFoot Wealth Limited is an appointed representative of Sense Network Limited which is authorised and regulated by the Financial Conduct Authority. SwitchFoot Wealth Limited is entered on the Financial Services register (www.fca.org.uk/register) under reference number 808196.
Registered Address: 28 Upper Hale Road, Farnham, Surrey, GU9 0NS. Registered in England & Wales No.: 11220173.
The information contained within this website is subject to the UK regulatory regime and therefore restricted to consumers based in the UK.

The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services business aren’t able to resolve themselves. To contact the Financial Ombudsman Service, please visit www.financial-ombudsman.org.uk.

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting
Cashflow planning: Tax planning and the affordability of gifting 6

Written by Sebastian Elwell

October 4, 2020

gifting

Cash flow planning: Tax planning and the affordability of gifting

Responsible financial planning doesn’t just mean suggesting where people should spend or invest their money; it also means making sure that the individual’s wishes are affordable in the short, medium and long terms. Financial advisers have a duty of care to their clients, so by working closely with them to understand their needs, goals and dreams, we can help them to plan sensibly and make informed decisions.

 That’s why we believe that cash flow planning is an essential part of private client work – for financial advisers, accountants and solicitors alike. Understanding its importance means we can give better advice and that in turn allows our clients to make the most of what they have.

The affordability of gifting

 Understandably, clients often want to gift assets to others – either outright or via a trust mechanism. There are many reasons for deciding to gift, including:

  •  Saving tax – gifting can be a straightforward way to reduce tax liabilities.
  • Helping onto the property ladder – it’s becoming increasingly common for parents to gift a deposit to help children buy their first home.
  • Bailing out in an emergency – unexpected circumstances can mean family members want to help out if they can.
  • Creating a long-lasting legacy – establishing a trust or giving to a favourite charity are ways of ensuring your gift lives on.

 For many, organising gifting is part of a financial planning and tax planning strategy. For others, it’s a big leap, and they can be afraid of committing to giving assets away. Some clients want to retain complete control of their assets – whether cash, investments, property or business – and are unconvinced that gifting should be part of their financial plan. Others worry that they will need the money in the future and can’t afford to give it away.

 How cash flow planning can help

 It’s our job as professional advisers to look at forward cash flow planning, both to make sure that the gifting requirements are affordable, and to give clients advice on when and how best to manage their gifts. This includes:

  •  Helping clients to visualise the short, medium and long-term effect on their finances
  • Making sure they understand the long-term tax savings potential
  • Test a range of ‘what if scenarios, including:
  • stock market crashes
  • they or their partner suddenly needs long term care
  • roof falls off or other home disasters
  • bereavement

Tax planning – quantifying the savings over the long term

 For financial advisers, ‘long term’ often goes beyond the lifespan of the client – good tax planning is about having a positive impact that affects the next decades and the next generation of the family.

 Tax planning means you can explain the value of your advice in this long-term scenario: it’s not just about being solvent for the next few years – it’s about the financial security of the client, their family, their business and their other interests. A service that often may seem expensive at the time brings huge dividends in terms of tax saved over this long-term period.

Justifying and Explaining the value of your advice. 

 For accountants and solicitors, good cash flow and tax planning enhances your legal advice and can help you to provide better, more compliant, less risky advice.

 If you would like to know more about how Switchfoot Wealth can compliment legal and accountancy advice, please get in contact with Sebastian today.

Cashflow planning: Tax planning and the affordability of gifting 7
Cashflow planning: Tax planning and the affordability of gifting 8
Cashflow planning: Tax planning and the affordability of gifting 9
Cashflow planning: Tax planning and the affordability of gifting 10

I started Switchfoot Wealth to offer financial planning that matches the way we live and work today. Using the best technology and offering expertise gained through both formal qualifications and years of working closely with clients, we are bringing financial planning into the 21st century, helping people, businesses and professional advisers make the most of their time and their money.

– Sebastian Ewell

Switchfoot Wealth Founder

Read more about Switchfoot Wealth

Related Articles

Collaboration: Cash Flow Planning & Business LPAs

Collaboration: Cash Flow Planning & Business LPAs

It can be difficult for healthy clients to imagine being unable to make decisions for themselves. Even clients who are acting as attorneys for parents or are carers often think it won’t happen to me.

But drawing up a Lasting Power of Attorney is fundamental to good financial management and providing clients with the care they’ll need in difficult times. We must persuade clients to put one in place before it’s too late.

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting

We believe that cash flow planning is an essential part of private client work – for financial advisers, accountants and solicitors alike. Understanding its importance means we can give better advice and that in turn allows our clients to make the most of what they have.

The perils of deliberate deprivation and why a cashflow plan matters

The perils of deliberate deprivation and why a cashflow plan matters

There are many legitimate reasons why people may want to make large gifts: for example, inheritance tax planning, supporting family members or ‘balancing up’ previously unequal gifts to family. When planning gifts, it is important that individuals take advice and document objectives and the effect of the gift, which can help protect them from an accusation of ‘deliberate deprivation’ in the future. Cashflow planning can help in this instance

SwitchFoot Wealth Limited is an appointed representative of Sense Network Limited which is authorised and regulated by the Financial Conduct Authority. SwitchFoot Wealth Limited is entered on the Financial Services register (www.fca.org.uk/register) under reference number 808196.
Registered Address: 28 Upper Hale Road, Farnham, Surrey, GU9 0NS. Registered in England & Wales No.: 11220173.
The information contained within this website is subject to the UK regulatory regime and therefore restricted to consumers based in the UK.

The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services business aren’t able to resolve themselves. To contact the Financial Ombudsman Service, please visit www.financial-ombudsman.org.uk.

Mental Capacity Act 2005 & Cashflow Planning

Mental Capacity Act 2005 & Cashflow Planning

Mental Capacity Act 2005 & Cashflow Planning
Mental Capacity Act 2005 & Cashflow Planning 11

Written by Sebastian Elwell

May 20, 2020

Mental Capacity Act 2005 & Cashflow Planning 12

Cashflow planning and the 5 Principles of the Mental Capacity Act.

Cashflow planning turns often complex calculations into a set of interactive and visually engaging infographics. Cashflow planning can be used to support vulnerable clients and help their appointed attorneys/deputies meet their obligations under the Mental Capacity Act of 2005 when making financial decisions.

 

Principles 1 & 2 – A presumption of Capacity (1) and Individuals being supported to make their own decisions (2)

Every adult has the right to make their own decisions and we must assume they have the capacity to do so unless proved otherwise. You cannot assume lack of capacity just because of a particular diagnosis or disability. Capacity is decision-specific; it may fluctuate between lack of capacity and lucid periods. An individual may have capacity over some decisions but not others.

The law is clear: a person must be given all practical help to make their own decisions before they are treated as lacking capacity. This means that attorneys/deputies should make every effort to encourage and support people to make the decision for themselves.

Cashflow planning can help with supported decision making – a case study

Paul has mobility problems and some cognitive impairment arising from a brain injury. His solicitor acts as his court-appointed Deputy.

Paul wishes to purchase a new motorised wheelchair and wants a top of the range model for £20,000. An older version of the same chair is available secondhand for £5,000. Both Paul and his solicitor agree he needs a new chair. The deputy will need to help Paul weigh a range of considerations and decide which chair he should get. Paul and his solicitor may consider any differences in performance, aesthetics, affordability, and so on.

Paul, his deputy, and his financial adviser previously had a cashflow plan. The financial adviser gave Paul access to his plan via a VoyantGo licence. The Deputy is able to log in and create a few ‘What if’ scenarios. A brief discussion with the financial adviser results in charts that show the effect on affordability.

Paul may not be in a position to understand all of the calculations involved but he may be perfectly capable of understanding the potential financial effect of his purchase decision as modelled by the ‘What if’ scenarios.

Paul and his Deputy are now in a better position to take account of the financial implications of the decision. The Deputy is making every effort to support Paul in the decision and involving him as much as possible.

Principle 3 – Unwise Decisions

People have the right to make unwise decisions. You cannot treat someone as lacking capacity because you disagree with their decision or think it unwise. Everyone has their own values and preferencesand may apply different weight to these values.

Returning to our case study, the Deputy believes that buying the £20,000 chair is too risky and jeopardises the long-term affordability of his client’s financial affairs, but perhaps Paul sees it differently: he wants to maximise quality of life and places greater weight on the non-financial factors than the Deputy does and so opts for the more expensive chair, despite the concerns over affordability.

The Deputy can take notes on the decision and keep the ‘What if’ scenarios on file, showing that they carefully considered affordability explain the reasoning behind the ultimate decision.

Principle 4 – Best Interests

Anything done for, or on behalf of, a person who lacks mental capacity must be done in their best interests.

One of the fundamental aspects of Voyant is ‘The Timeline’. This is a great opportunity to document the key milestones, goals and objectives for Paul. Financial decisions can be weighed against their effect on his ability to meet these goals and objectives. Cashflow planning can help show which course of action is likely to be in his best interest.

Principle 5 – Least Restrictive Option

Someone making a decision or acting on behalf of a person who lacks capacity must consider if it is possible to  decide or act in a way that would interfere less with the person’s rights and freedoms of action.

In respect of managing ongoing financial affairs, it is helpful for attorneys or deputies to consider if it is possible to leave some control of arrangements to Paul. The question is, how much?

Cashflow modelling can be used by the attorneys or deputy to consider a range of scenarios.  What if it all goes wrong, and Paul over-spends? After all, he may have some capacity to make some unwise decisions, but cannot manage all of his finances over a longer term.

The Deputy may choose to set up a separate account for Paul to manage and control how much cash is transferred into it. Cashflow planning can give the deputy or attorney the confidence to take a less restrictive approach to management of the finances and leave as much control as possible and sensible with Paul.

To find out more about how cashflow planning can assist deputies and attorneys to inform their clients and allow the best decisions to be made in light of capacity, you can always contact my team and me at Switchfoot Wealth.

Mental Capacity Act 2005 & Cashflow Planning 13
Mental Capacity Act 2005 & Cashflow Planning 14
Mental Capacity Act 2005 & Cashflow Planning 15
Mental Capacity Act 2005 & Cashflow Planning 16

I started Switchfoot Wealth to offer financial planning that matches the way we live and work today. Using the best technology and offering expertise gained through both formal qualifications and years of working closely with clients, we are bringing financial planning into the 21st century, helping people, businesses and professional advisers make the most of their time and their money.

– Sebastian Ewell

Switchfoot Wealth Founder

Read more about Switchfoot Wealth

Related Articles

Collaboration: Cash Flow Planning & Business LPAs

Collaboration: Cash Flow Planning & Business LPAs

It can be difficult for healthy clients to imagine being unable to make decisions for themselves. Even clients who are acting as attorneys for parents or are carers often think it won’t happen to me.

But drawing up a Lasting Power of Attorney is fundamental to good financial management and providing clients with the care they’ll need in difficult times. We must persuade clients to put one in place before it’s too late.

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting

We believe that cash flow planning is an essential part of private client work – for financial advisers, accountants and solicitors alike. Understanding its importance means we can give better advice and that in turn allows our clients to make the most of what they have.

The perils of deliberate deprivation and why a cashflow plan matters

The perils of deliberate deprivation and why a cashflow plan matters

There are many legitimate reasons why people may want to make large gifts: for example, inheritance tax planning, supporting family members or ‘balancing up’ previously unequal gifts to family. When planning gifts, it is important that individuals take advice and document objectives and the effect of the gift, which can help protect them from an accusation of ‘deliberate deprivation’ in the future. Cashflow planning can help in this instance

SwitchFoot Wealth Limited is an appointed representative of Sense Network Limited which is authorised and regulated by the Financial Conduct Authority. SwitchFoot Wealth Limited is entered on the Financial Services register (www.fca.org.uk/register) under reference number 808196.
Registered Address: 28 Upper Hale Road, Farnham, Surrey, GU9 0NS. Registered in England & Wales No.: 11220173.
The information contained within this website is subject to the UK regulatory regime and therefore restricted to consumers based in the UK.

The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services business aren’t able to resolve themselves. To contact the Financial Ombudsman Service, please visit www.financial-ombudsman.org.uk.

Are you meeting your safeguarding duties?

Are you meeting your safeguarding duties?

Are you meeting your safeguarding duties?
Are you meeting your safeguarding duties? 17

Written by Sebastian Elwell

May 20, 2020

Are you meeting your safeguarding duties? 18

This blog was first published by Lawskills and has been replicated in part here, the original article is available on the following link

https://www.lawskills.co.uk/articles/2019/05/attorneys-safeguarding-duties-help/

 

Are you meeting your safeguarding duties?

In December 2018, high street bank Santander was fined nearly £33m for failing to pass on the assets of deceased customers to their personal representatives and beneficiaries. In some cases, said the Financial Conduct Authority, the bank failed to realise that the deceased customer had multiple accounts. So if the beneficiaries and representatives were also unaware, the money was never released by the bank.

A separate case, re: MM, highlights the potential difficulties of a situation where two attorneys, appointed jointly and severally – one of whom is a solicitor. In theory, this is a sensible arrangement; there is both an attorney with a personal connection to the individual, and an attorney who understands the relevant legal responsibilities and constraints and can ensure that the attorneyship is correctly managed.

In the case of MM, however, financial abuse occurred, and that abuse would have been noticed sooner had the professional attorney sought access to financial statements, or had established a better understanding of the relationships of the donor and her family, only one of which had been appointed as attorney.

Talking about the law as it applied to this case, District Judge Batten referred to paragraph 7.59 of the Code of Practice to the MCA 2005, which states:

“Duty of care’ means applying a certain standard of care and skill – depending on whether the attorney is paid for their services or holds relevant professional qualifications…. If attorneys are being paid for their services, they should demonstrate a higher degree of care & skill. Attorneys who undertake their duties in the course of their professional work (such as solicitors….) must display professional competence and follow their profession’s rules and standards.”

The Judge ruled that the Property and Financial Affairs LPA should be wholly revoked and a panel Deputy appointed. The solicitor was responsible for their own costs incurred by the case, and jointly responsible for the Official Solicitor’s costs and any other reasonable costs arising.

The importance of safeguarding

Both these cases show a need for all attorneys to have clear, real-time oversight over the individuals’ financial matters, and the case of MM shows how important it is for professional attorneys to not only understand the law, but apply it strictly and in the individual’s interests. Attorneys cannot simply add the individual to a long list of clients and hope that everything goes smoothly. Attorneyships are often made and used in times of stress and can bring significant complications. It is the duty of a professional attorney to do everything they can to administer an estate wholly in the interests of an individual and to guide any other attorneys accordingly.

Partnering with Switchfoot Teams

Switchfoot Wealth has partnered with Switchfoot Teams to provide access to the Switchfoot Teams portal which has been developed to meet the needs of attorneys, deputies and trustees.

To find out more, contact us today.

Are you meeting your safeguarding duties? 19
Are you meeting your safeguarding duties? 20
Are you meeting your safeguarding duties? 21
Are you meeting your safeguarding duties? 22

I started Switchfoot Wealth to offer financial planning that matches the way we live and work today. Using the best technology and offering expertise gained through both formal qualifications and years of working closely with clients, we are bringing financial planning into the 21st century, helping people, businesses and professional advisers make the most of their time and their money.

– Sebastian Ewell

Switchfoot Wealth Founder

Read more about Switchfoot Wealth

Related Articles

Collaboration: Cash Flow Planning & Business LPAs

Collaboration: Cash Flow Planning & Business LPAs

It can be difficult for healthy clients to imagine being unable to make decisions for themselves. Even clients who are acting as attorneys for parents or are carers often think it won’t happen to me.

But drawing up a Lasting Power of Attorney is fundamental to good financial management and providing clients with the care they’ll need in difficult times. We must persuade clients to put one in place before it’s too late.

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting

We believe that cash flow planning is an essential part of private client work – for financial advisers, accountants and solicitors alike. Understanding its importance means we can give better advice and that in turn allows our clients to make the most of what they have.

The perils of deliberate deprivation and why a cashflow plan matters

The perils of deliberate deprivation and why a cashflow plan matters

There are many legitimate reasons why people may want to make large gifts: for example, inheritance tax planning, supporting family members or ‘balancing up’ previously unequal gifts to family. When planning gifts, it is important that individuals take advice and document objectives and the effect of the gift, which can help protect them from an accusation of ‘deliberate deprivation’ in the future. Cashflow planning can help in this instance

SwitchFoot Wealth Limited is an appointed representative of Sense Network Limited which is authorised and regulated by the Financial Conduct Authority. SwitchFoot Wealth Limited is entered on the Financial Services register (www.fca.org.uk/register) under reference number 808196.
Registered Address: 28 Upper Hale Road, Farnham, Surrey, GU9 0NS. Registered in England & Wales No.: 11220173.
The information contained within this website is subject to the UK regulatory regime and therefore restricted to consumers based in the UK.

The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services business aren’t able to resolve themselves. To contact the Financial Ombudsman Service, please visit www.financial-ombudsman.org.uk.

Safeguarding plays a vital role in LPA administration – a case study Part 1

Safeguarding plays a vital role in LPA administration – a case study Part 1

Safeguarding plays a vital role in LPA administration – a case study Part 1
Safeguarding plays a vital role in LPA administration – a case study Part 1 23

Written by Sebastian Elwell

May 20, 2020

Safeguarding plays a vital role in LPA administration – a case study Part 1 24

This blog was first published by Lawskills and has been replicated in here, the original article is available on the following link

https://www.lawskills.co.uk/articles/2019/08/safeguarding-in-lpa-administration/

 

Safeguarding plays a vital role in LPA administration – a case study 

John Smith has a fairly complex estate and has recently had a meeting with his financial adviser, who has asked whether he has a Lasting Power of Attorney (LPA). This isn’t the first time his financial adviser has asked the question and John did recently have a work colleague whose wife lost capacity without an LPA in place; he remembers that trying to sort out all the finances and paperwork was incredibly stressful for his colleague.

So he decides that he not only needs to put an LPA in place; he needs to talk to his preferred attorneys to ensure they understand what they are taking on, and that they have access to all the information they need when the time comes.

John chooses a local law firm, and asks them to draft his LPA. He’s nervous because he’s heard that attorneys can take advantage of their powers – particularly over finances – and he wants to make sure that couldn’t happen in his case. He is concerned about losing control of his finances, and about how to make sure his attorneys follow his wishes when they make decisions.

John’s solicitor talks him through the supervision and safeguarding clauses that could be included in his LPA. They discuss the skills and approach that someone in a safeguarding or supervision role would need, and the responsibilities they would have. They also talk about who John might want to appoint as an attorney, and whether they are willing and able to make that commitment. 

What makes a good safeguarder?

  • Someone who you know is trustworthy
  • Someone who has good money-management skills
  • Someone who is a good decision-maker
  • Someone who has the ability to oversee the duties carried out by the attorney
  • Someone who can step in quickly if there is an issue or even a crisis
  • John decides to appoint his niece as his attorney, but in addition he would like a professional to supervise the decisions of the attorney once he has lost capacity, checking regularly that everything seems to be in order, supporting his niece if she is in need of guidance and pre-authorised to report any safeguarding concerns. The solicitor adds clauses to the LPA that allows for this option including a charging clause.

In order to avoid any doubt about over the potential conflict of confidentiality and safeguarding duties, the solicitor asks John to sign an advance consent for permission to disclose confidential information to safeguard him and his property.  John feels confident that he has an extra layer of security in place which will protect him and his finances when he is most vulnerable. 

Maintaining financial transparency

 John then wants to know how he can be sure his attorney’s actions will be transparent. His solicitor suggests Switchfoot Teams, which several of her clients use successfully. An online system, it allows attorneys and designated individuals to see what financial transactions have taken place on a real-time basis. This is a deterrent to financial abuse and ensures that all actions are transparent at all times. Accounts production can be automated and the accounts default to a chart of accounts in line with OPG deputy return, offering the best practice available from modern personal accounting.  John sets up Switchfoot Teams and invites his solicitor into his ‘Team’.

The solicitor recommends that the following clauses be added to John’s LPA:

‘I direct that my attorneys shall provide access to an online system detailing all of my financial accounts to [insert chosen safeguarder]’

‘I direct that my attorneys shall produce summary accounts including a complete transaction history to [insert chosen safeguarder] on a monthly basis.’

Initially John sets up Switchfoot Teams, providing limited access for his attorney.  In years to come, as his ability to manage his affairs decreases, the access level can be increased for his attorney when she needs to support John in his decisions and when she needs to act, providing for a smooth transition. And John can be confident that, if needed, his appointed safeguarder will be able to step in if anything goes wrong. 

Partnering with Switchfoot Teams

Switchfoot Wealth has partnered with Switchfoot Teams to provide access to the Switchfoot Teams portal which has been developed to meet the needs of attorneys, deputies and trustees.

To find out more, contact us today.

Safeguarding plays a vital role in LPA administration – a case study Part 1 25
Safeguarding plays a vital role in LPA administration – a case study Part 1 26
Safeguarding plays a vital role in LPA administration – a case study Part 1 27
Safeguarding plays a vital role in LPA administration – a case study Part 1 28

I started Switchfoot Wealth to offer financial planning that matches the way we live and work today. Using the best technology and offering expertise gained through both formal qualifications and years of working closely with clients, we are bringing financial planning into the 21st century, helping people, businesses and professional advisers make the most of their time and their money.

– Sebastian Ewell

Switchfoot Wealth Founder

Read more about Switchfoot Wealth

Related Articles

Collaboration: Cash Flow Planning & Business LPAs

Collaboration: Cash Flow Planning & Business LPAs

It can be difficult for healthy clients to imagine being unable to make decisions for themselves. Even clients who are acting as attorneys for parents or are carers often think it won’t happen to me.

But drawing up a Lasting Power of Attorney is fundamental to good financial management and providing clients with the care they’ll need in difficult times. We must persuade clients to put one in place before it’s too late.

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting

We believe that cash flow planning is an essential part of private client work – for financial advisers, accountants and solicitors alike. Understanding its importance means we can give better advice and that in turn allows our clients to make the most of what they have.

The perils of deliberate deprivation and why a cashflow plan matters

The perils of deliberate deprivation and why a cashflow plan matters

There are many legitimate reasons why people may want to make large gifts: for example, inheritance tax planning, supporting family members or ‘balancing up’ previously unequal gifts to family. When planning gifts, it is important that individuals take advice and document objectives and the effect of the gift, which can help protect them from an accusation of ‘deliberate deprivation’ in the future. Cashflow planning can help in this instance

SwitchFoot Wealth Limited is an appointed representative of Sense Network Limited which is authorised and regulated by the Financial Conduct Authority. SwitchFoot Wealth Limited is entered on the Financial Services register (www.fca.org.uk/register) under reference number 808196.
Registered Address: 28 Upper Hale Road, Farnham, Surrey, GU9 0NS. Registered in England & Wales No.: 11220173.
The information contained within this website is subject to the UK regulatory regime and therefore restricted to consumers based in the UK.

The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services business aren’t able to resolve themselves. To contact the Financial Ombudsman Service, please visit www.financial-ombudsman.org.uk.

LPA safeguarding in practice – a case study part 2

LPA safeguarding in practice – a case study part 2

LPA safeguarding in practice – a case study part 2
LPA safeguarding in practice – a case study part 2 29

Written by Sebastian Elwell

May 20, 2020

LPA safeguarding in practice – a case study part 2 30

LPA safeguarding in practice – a case study part 2

 This blog was first published by Lawskills and has been replicated here, the original article is available on the following link

https://www.lawskills.co.uk/articles/2019/09/lpa-safeguarding-in-practice-a-case-study/

In our last article, we introduced you to John Smith. John had a complex estate and had decided to put a Lasting Power of Attorney in place so that someone he trusted could look after his finances and act in his best interests if he lost capacity.

Worried about the potential for financial abuse and fraud, however, John spoke both to his financial adviser and to his solicitor about how best to protect his finances. They suggested two things:

  • To add a safeguarding clause that appointed a third party to oversee the activities of any attorneys; and
  • To use real-time software that reflects any financial transactions and allows attorneys, safeguarders and other professionals to have an overview of John’s financial situation once he has lost capacity.

John accepted this advice and appointed his niece as his attorney, and a professional into a supervision role. He set up the software, added all his bank accounts and other financial information, and uploaded copies of his will, insurance policies and the LPA.

 John invites his niece and solicitor into his ‘Team’ with a restricted online view into his wealth portal. John arranges an annual check in with his solicitor.  Confident that he has put everything in place, John gets on with life.

Losing capacity – the attorney takes over

John has recently lost the capacity to manage his own finances, and now needs the help and support of his attorney.  After the paperwork has been managed to confirm that his attorney can now act on his behalf. John’s niece was in regular touch before he lost capacity and knows what are his financial wishes. She now has access to all his bank and savings accounts, investments and pension funds and needs to manage them correctly in order to ensure that John remains in the best possible financial position whilst also being able to meet any costs associated with his standard of living and general care.

At this point, the supervision and safeguarding clauses that John added to his LPA are actioned. The professional appointed as safeguarder now has oversight of John’s accounts and will be able to see, in real time, if there are any unusual or unexpected transactions taking place. This is particularly applicable if, for example, John’s niece lives at a distance and John has a carer coming into the home. He may give the carer his bank card to buy sundries, and his niece and his safeguarder may be completely unaware that he has done this. But, by having oversight of the accounts, they can see if that card is being abused or used fraudulently and query it immediately with John, his carer and the agency supplying the carer.

John is able to retain use over some of his accounts as there is support and oversight in the background from the attorney with real-time bank feeds updating the information.  This gives confidence to both the attorney and John and is in line with the principle of ‘least restrictive option’ if the alternative is to remove access entirely.

Easy accounts production for attorneys and third parties

Attorneys – particularly family members – are often busy people. At the time of life when they become attorneys they are usually working full-time, raising their own family and perhaps also caring for other older relatives. That means less time to keep an eye on attorneyship finances and less time to put together potentially complicated accounts.

The beauty of Switchfoot Teams – the software system John chose – is that it can produce accounts automatically, using the latest information so that accounts are completely up-to-date and accurate. This satisfies requirements from the Court of Protection and any other sources without attorneys having to spend hours poring over the figures.

So far, so good. But what happens when the appointed attorney can’t manage his or her duties any more? Find out in the final part of our case study.

Partnering with Switchfoot Teams

Switchfoot Wealth has partnered with Switchfoot Teams to provide access to the Switchfoot Teams portal which has been developed to meet the needs of attorneys, deputies and trustees.

To find out more, contact us today.

LPA safeguarding in practice – a case study part 2 31
LPA safeguarding in practice – a case study part 2 32
LPA safeguarding in practice – a case study part 2 33
LPA safeguarding in practice – a case study part 2 34

I started Switchfoot Wealth to offer financial planning that matches the way we live and work today. Using the best technology and offering expertise gained through both formal qualifications and years of working closely with clients, we are bringing financial planning into the 21st century, helping people, businesses and professional advisers make the most of their time and their money.

– Sebastian Ewell

Switchfoot Wealth Founder

Read more about Switchfoot Wealth

Related Articles

Collaboration: Cash Flow Planning & Business LPAs

Collaboration: Cash Flow Planning & Business LPAs

It can be difficult for healthy clients to imagine being unable to make decisions for themselves. Even clients who are acting as attorneys for parents or are carers often think it won’t happen to me.

But drawing up a Lasting Power of Attorney is fundamental to good financial management and providing clients with the care they’ll need in difficult times. We must persuade clients to put one in place before it’s too late.

Cashflow planning: Tax planning and the affordability of gifting

Cashflow planning: Tax planning and the affordability of gifting

We believe that cash flow planning is an essential part of private client work – for financial advisers, accountants and solicitors alike. Understanding its importance means we can give better advice and that in turn allows our clients to make the most of what they have.

The perils of deliberate deprivation and why a cashflow plan matters

The perils of deliberate deprivation and why a cashflow plan matters

There are many legitimate reasons why people may want to make large gifts: for example, inheritance tax planning, supporting family members or ‘balancing up’ previously unequal gifts to family. When planning gifts, it is important that individuals take advice and document objectives and the effect of the gift, which can help protect them from an accusation of ‘deliberate deprivation’ in the future. Cashflow planning can help in this instance

SwitchFoot Wealth Limited is an appointed representative of Sense Network Limited which is authorised and regulated by the Financial Conduct Authority. SwitchFoot Wealth Limited is entered on the Financial Services register (www.fca.org.uk/register) under reference number 808196.
Registered Address: 28 Upper Hale Road, Farnham, Surrey, GU9 0NS. Registered in England & Wales No.: 11220173.
The information contained within this website is subject to the UK regulatory regime and therefore restricted to consumers based in the UK.

The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services business aren’t able to resolve themselves. To contact the Financial Ombudsman Service, please visit www.financial-ombudsman.org.uk.