What is a Lasting Power of Attorney and why do I need one now?

As you go through life, things may occur, that are out of your control, which may mean that you need someone to act on your behalf. These things can happen to you at any time and are not restricted to later in life. 

You may have been diagnosed with dementia, where further down the line you could lose mental capacity, which would mean that you would need someone to act for you on your behalf.

You may have cognitive issues following a stroke which affects your understanding and mental capacity, someone would need to act for you on your behalf.

Or it could be a temporary situation, where you are in hospital for a period of time, and you need someone to act for you in regard to your financial affairs, like paying your bills.

It can be as simple as you are about to travel for an extended period (for work or pleasure) and need someone to handle your affairs at home.

Setting up a Lasting Power of Attorney doesn’t mean that you suddenly give up control. You can choose whether it can be used either before, or only when, you lose mental capacity.

A Lasting Power of Attorney

A Lasting Power of Attorney, or an LPA, is a legal document that gives someone else, who you nominate, the right to act for you, and to make decisions on your behalf, but only if you’re unable to, now or in the future. 

There are two types of Lasting Power of Attorney: A Health and Welfare LPA and a Property and Affairs LPA. 

A Health and Welfare Lasting Power of Attorney allows you to nominate a person, known as your attorney, who can make decisions about your health, such as the medical treatment you receive and where you receive it, and decisions on your personal welfare, such as your day-to-day care, or where you live. 

A Property and Affairs Lasting Power of Attorney, covers the decisions which need to be made, and the matters which need to be handled, pertaining to financial and material things in your life, such as paying your bills, collecting and distributing your income and benefits, or should it be necessary, selling your house.

However, the attorney is only able to make these decisions on your behalf when you lack the mental capacity to do so yourself.

What is mental capacity?

Mental capacity is defined as the ability to make or communicate specific decisions at the time they need to be made. In relation to a Lasting Power of Attorney, to have mental capacity you must be able to understand the decision you need to make, why you need to make it, and the likely outcome of your decision.

For example, an individual can make decisions about some things but not others, and some days they could be lucid and in full capacity, but on other days their ability to make decisions could be impaired, therefore they would be lacking mental capacity.

However, if you need more time to communicate your needs and wishes due to an issue with speech, or you need more time to understand something, this doesn’t necessarily mean that you lack mental capacity. 

How to set up a Lasting Power of Attorney

It can be a complicated process to set up a Lasting Power of Attorney, and you have the choice to do this yourself, with the help of a solicitor, through an advice agency such as the citizens advice bureau, or you can set up your Lasting Power of Attorney as part of your Estate Plan. Our team can help you to navigate this, as taking professional advice now can prevent problems later on, particularly if you’re unsure of the process, or if your affairs are complicated.

If you wish to apply for a Lasting Power of Attorney yourself, you can contact the Office of the Public Guardian for all of the relevant forms and an information pack. You can download the forms or complete them online.

When should you set up a Lasting Power of Attorney?

Regardless of age or health, everyone should consider a Lasting Power of Attorney, and anyone over 18 can set one up.

It is important to remember that anyone at any age can have a life changing accident, and people can lose mental capacity following catastrophic accidents like these, on a temporary or permanent basis. If there is no Lasting Power of Attorney in place, and you have lost the ability to make decisions for yourself, an organisation called the Court of Protection may become involved.     

With a Lasting Power of Attorney, the attorney nominated will only be able to make decisions for you, on your behalf, if you are unable to do so yourself, at the time that these decisions need to be made. For example, should you be in a coma, your Attorney would only make decisions for you at this time. As you wake from the coma, the control over your decisions returns to you.

If you are diagnosed with a long-term condition that you know will cause a loss of capacity down the line, you have the time to set up a Lasting Power of Attorney, but to be fully protected, it is advisable to set this up sooner rather than later.

Remember, should you have an accident, or your condition deteriorates quicker than expected, your relatives would be unable to access your money, even to pay for your care, without a Lasting Power of Attorney, and they would need to go through a court which can take time and can be extremely costly. 

Even if you are married or co-habiting, your spouse cannot deal with any bank accounts or pensions in your name without a Lasting Power of Attorney.

To find out more about setting up your Lasting Power of Attorney, call Hello Estate Planning today on 0161 676 5421.