UK adults risk it as relatives manage their money for them
21 January 2019
- 25% of over 45 year olds have access to a relative’s bank account who isn’t their spouse
- Majority say it’s to manage their money for them
- 79% do not have a lasting power of attorney in place
UK adults are putting their finances at risk by shortcutting powers of attorney and relying on good will from their relatives to manage their finances, according to Co-op, the UK’s leading probate provider.
A quarter (25%) of over 45 year olds have access to a relative’s bank account who isn’t their spouse. Of these adults, almost a tenth (7%) have set up formal joint accounts with a relative, whilst a fifth (18%) have access to a relative’s bank card or internet accounts.
Of those people who have put joint bank accounts in place, a third (35%) said they had access to a parent’s bank account and a fifth (18%) are able to access a sibling’s account. A tenth (11%) can access an aunt or uncle’s accounts and a further tenth (9%) can access the account of a grandparent.
According to the research, which was conducted among 2000 over 45 year olds, the main reasons for the access are to manage their money for them and to pay for groceries and luxuries such as holidays – things, that an appointed attorney could do legally and securely.
Whilst so many over 45 year olds have these informal arrangements in place, over a tenth (11%) admitted that they’d worry about a relative borrowing money if they were short themselves and a further 5% said they had suspicions that their relative may have previously taken money.
Despite this, the research shows that people are opting out of putting a power of attorney in place. Instead, they’re making their own unofficial arrangements to enable relatives to make decisions about their finances. Four fifths (79%) of those surveyed said they do not have a lasting power of attorney in place.
Furthermore, three quarters (74%) of people aged between 65 and 74 and two thirds (67%) of people aged 75 to 84 also do not have a lasting power of attorney in place.
Gavin Holt, Head of Probate at the Co-op said:
“It’s concerning that so many people are ignoring, or perhaps are not aware of, the benefits of lasting powers of attorney and are putting these accounts of convenience in place instead.
“Whilst it may seem convenient and safe at the time, in our experience, these informal arrangements can often cause significant problems which only come to light after death. The worst of the problems, and sadly one of the most regular, is where financial abuse is alleged to have taken place. This can add months, if not years, to the length of the probate process.”
A lasting power of attorney is a secure and formal means of allowing trusted individuals to make decisions about a person’s finances and also about their personal welfare, and they continue to have effect in the event that the person becomes unable to make the decisions themselves.
For more information contact:
Emily Penkett: Emily.Penkett@coop.co.uk / 07738621201
Sarah Pyatt: Sarah.Pyatt@coop.co.uk / 07850 002 312
Research was conducted on behalf of Co-op among 2000 over 45 year olds by Atomik in December 2018.
The Co-op is one of the world’s largest consumer co-operatives with interests across food, funerals, insurance, legal services and an online electrical store. It has a clear purpose of championing a better way of doing business for you and your communities. Owned by millions of UK consumers, the Co-op operates 2,500 food stores and over 1,000 funeral homes, with more than 63,000 colleagues and an annual revenue of £9.5bn.