Lasting Power of Attorney
A Will provides protection to your loved ones and assets after your death, a Lasting Power of Attorney (LPA) provides security for you and your family whilst you are alive.
LPA’s are not just used for the elderly, they can be extremely useful for business people who travel and need things looking after while they are away or for single people who would benefit from having someone available to help out in the short term if necessary.
What is a Lasting Power of Attorney?
A lasting power of attorney (LPA) is a legal document that lets you appoint one or more people to help you make decisions or to make decisions on your behalf.
You don’t need to live in the UK or be a British citizen to make an LPA, but you do need to be 18 or over and have mental capacity (the ability to make your own decisions) when you make your LPA.
Why do I need to make a Lasting Power of Attorney?
None of us know what the future holds for us, but we can be prepared.
If there comes a time in your life when you are no longer able to look after your affairs due to a sudden accident, illness or gradually advancing age, you may wish for a close relative or friend to assist you in paying your bills, to manage your bank accounts or to speak on your behalf on medical matters.
An LPA is a legal document that can only be completed whilst you have the mental capacity to do so, so putting it off now might mean that it cannot be done later.
What happens if I don’t make a Lasting Power of Attorney?
When people become mentally incapacitated the law may intervene to prevent them from dealing with their own financial or medical affairs.
Having a joint bank account with your spouse does not guarantee that they will be able to keep full access to your funds. If you were to be deemed incapable of making financial decisions, whether from suffering a stroke, mental illness or an accident that renders you incapacitated then all your bank accounts would be frozen until a Court appointed deputy is appointed.
If an application has to be made to the Office of Public Guardians or the Court of Protection, it can be a costly and upsetting experience for your family and take up to twelve months to be resolved, which could result in your finances becoming a messy affair. It is not automatically guaranteed that your spouse of partner would be the appointed attorney, which could mean a court official is appointed resulting in expense every time a decision is needed to be made.
There are two types of Lasting Power of Attorney.
Property and Financial affairs
This type of LPA covers your property and financial affairs. Your finances might include managing investments, bank accounts, paying bills or collecting benefits or other income.
You do not have to have lost your mental capacity to use the LPA, you may simply have trouble with mobility or using a phone due to hearing loss or even be away on business or on holiday, in which case you can use an LPA to allow someone to do these things on your behalf.
It’s important to stress that having a joint account does not mean that your spouse or partner will automatically be given responsibility for your affairs, and that if you are deemed incapable of making financial decisions your accounts will be frozen, even if in joint names. Your spouse would then need to wait up to twelve months in order to gain access once more to your accounts. The existence of an LPA for property and financial affairs will ensure this does not happen.
Health and Welfare
This type of LPA can only be used when you are no longer capable of making decisions for yourself, it gives your representative legal powers to make decisions for your healthcare and can also cover the giving or refusing consent for medical treatment or care.
They would also be responsible for making the best decision for your long-term care; deciding whether the best place for you would be in your own home with support from local social services or in residential care.
You do not need to appoint the same person to act for you for both types of LPA, so you can make your choices based on who you feel will make the best decisions for you in each situation.
There are laws in place that protect you so that an LPA cannot be enforced without you actually being legally deemed incapable.
You can appoint more than one person to act for you if you wish. You can also place restrictions such as your attorney can only act for you after you lack mental capacity or you can appoint them to act only in certain areas of your affairs.
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