Why is having a Lasting Power of Attorney in place important?
With more advanced medication and treatment plans in place, people are living longer! While we all relish the prospect of living longer, what will happen if we are not healthy enough to enjoy it? And should we lose the mental capacity to make decisions, who will make them for us? This is why having a Lasting Power of Attorney (LPA) in place is more important than ever. You can make sure you have a say while you can and ensure that people you trust are authorised to make important decisions for you if you become unable to. There is the possibility that in your lifetime the LPA won’t be needed, which of course is the ideal outcome. However, there is no predicting what the future may hold, and mental capacity can be lost at any time for any number of reasons.
Health and Welfare LPA
There are two different types of LPAs: Health & Welfare and Property & Financial. Health and Welfare covers smaller decisions like how often you’d like a haircut to the big decisions like life sustaining treatment. Without having a Health and Welfare LPA in place, by law, there is very little a family member can do in regards to medical decisions or life sustaining treatment if they disagree with decisions being made by medical professionals. It is a common misconception that just because someone is your spouse or next of kin it allows them to automatically deal with your affairs both medically and financially should you be unable to do so. Without an LPA a family member or close friend would have to apply to the Court of Protection (CoP) to obtain that authority, which can be a stressful process, especially if the medical staff and/or the family are disagreeing about treatment plans that are time sensitive. Not only is the application a stressful experience, but it is a lengthy and costly process, and they are not always successful.
Having an LPA in place would avoid the unnecessary stress and upset that could be caused, and you can be comforted by the fact your loved ones are doing what you would have wanted.
It’s not just the older generation who should have LPAs in place, but the younger generation too. Cases of young adults suffering capacity issues due to tragic accidents is more common than you may think. It may seem like it’s too early to discuss this, but regardless, it is the only way to express your wishes if you are no longer able no matter what your age.
Most of our clients decide to make an LPA at the same time as making a Will, focusing on full future lifetime planning to protect not only their affairs at their death but also in their lifetime too.
The other type of LPA is called a Financial Affairs LPA. Similarly, to the above, it allows for trusted individuals in your life to make decisions for you, however there is a unique difference between the two. Health and Welfare LPAs only come into effect when the Donor has lost mental capacity, whereas you could choose for a Financial Affairs LPA to come into effect immediately (with your consent) i.e., if you needed to go to hospital for a few weeks.
You may be wondering in what sort of cases a Financial LPA may be needced? Here’s one of many examples; husband (H) and wife (W). H deals with the money in the relationship. The money is in a sole account as W trusts H to deal with all financial affairs within their marriage. H is involved in a road traffic accident causing him to lose mental capacity. This puts W in a difficult situation, as she is unable to automatically access the bank accounts H used, therefore the mortgage and bills cannot be paid. W now must pay over £400 for an application to the Court of Protection for a judge to allow W to have access to H’s bank accounts under a deputyship order. If there was a Property and Financial LPA in place appointing W as attorney this situation could have been avoided and dealt with much quicker and with less stress and cost involved!
Under a Property and Financial Affairs LPA, you can appoint an attorney(s) to support you or make decisions about things such as money, tax and bills, bank and building society accounts, property and investments and pensions and benefits. Your attorney’s will also have the power to use your money to look after your home and buy anything required on a day-to-day basis, i.e., food. If you normally give gifts to friends, family members or acquaintances on birthdays or anniversaries then your attorney can continue to do so. This includes charitable donations, providing of course the funds are available to do so. It is important to understand that the attorney must keep your finances separate from their own unless of course there is a joint bank account in place.
How does the application process work?
You (the “Donor”) are allowed to appoint attorneys, as well as replacement attorneys, to make such decisions on your behalf. This is something to carefully consider as the attorney(s) should be someone you trust whole heartedly to make the right decisions when you are no longer able to do so. Instructions and preferences can be included if you have a particular way that you would like things to be done, but others leave it fully up to their attorneys hence the need for using someone you trust. It is important to note that listing off a lot of instructions and preferences may not work in your favour, as the Office of the Public Guardian (OPG), who are in charge of registering the LPA, may take this is a lack of trust in your attorneys. So, think carefully about what you choose to include.
It is important to note that both LPAs need to be applied for separately. You can appoint different attorneys for each one if you would like. You aren’t required to apply for both, although we would recommend it.
Looking at an LPA application can seem daunting, and if you don’t feel comfortable carrying out the process yourself, we offer a LPA writing service. However, if you feel confident to complete the forms by yourself then we can simply check over the documents before sending them. It is important they are executed correctly to avoid the time and cost of having to resubmit an application. Don’t delay!