Lasting Powers of Attorney: What they can do for you
It’s common knowledge that setting up an estate plan while you are alive allows your wishes to be easily followed after death. What isn’t commonly discussed, however, is how Lasting Powers of Attorney can provide peace of mind during your lifetime. These particularly important documents apply only whilst you are alive and are totally separate from your Will.
What are Lasting Powers of Attorney (LPAs)
An LPA, or Lasting Power of Attorney, is a legal document that allows you (the Donor) to appoint someone else to make decisions on your behalf in specific situations. For example, you might appoint a family member to handle your financial affairs, and property transactions or make decisions about medical treatment if you are deemed unable to do so yourself. This could be due to illness or disability, such as dementia, stroke, accident, or even being away from home for extended periods. Having an LPA in place gives you peace of mind meaning that you don’t have to worry about losing decision-making rights either because you’ve already made them or empowered somebody you trust to make them for you.
The importance of Lasting Powers of Attorney
There are two types of LPA and they each deal with different areas of life, such as:
Health & Welfare LPA can make decisions on:
- Where you live.
- What you eat, how you dress, and how you are cared for daily.
- Who do you have contact with.
- Your medical and end-of-life care.
- This type of LPA can only be used if the Donor becomes mentally incapable of making their own decisions.
Property and Finance LPA can be responsible for
- Bank or building society accounts.
- Renovations or maintenance of your property.
- Payment of bills.
- Pension and/or benefits.
- Re-mortgaging or selling your home.
Why do I need an LPA? My family can handle everything.
Most people believe that if they lost mental capacity, their family members, such as a wife, husband or child would be able to manage everything for them. The concept of a “next of kin” isn’t legal and does not grant any rights to help manage assets or wellbeing. Before a family member could make such decisions and carry out such activities on your behalf, they would have to apply to the court for permission to act as your Deputy.
Who should you appoint as your Attorney?
LPAs can be very useful tools, but it is important to choose the right person to act as your attorney. The person you appoint should be someone you trust completely and who has the necessary skills and knowledge to deal with the tasks you have assigned them.
A common practice is to appoint someone from your close family to be your Attorney. Appointing a secondary Attorney is also recommended, in case your first choice is not available.
Lost capacity – what is it and when can it happen?
According to HNS capacity is the ability to use and understand the information in order to make a decision, as well as communicate that decision. A person is considered to lack capacity if their mind is impaired or disturbed in some way, preventing them from making a sound judgement at that time.
Some examples of conditions which may impair an individual’s capacity include mental health conditions such as:
- Schizophrenia or bipolar disorder.
- Severe learning disabilities.
- Brain damage caused by stroke or other injuries.
- Physical or mental conditions causing confusion or loss of consciousness.
- Intoxication due to drugs or alcohol.
It is important to note that LPAs must be created while the individual can still make their own decisions, and they must be signed and witnessed to be valid. A doctor’s certificate stating mental capacity is required. Lasting Powers of Attorney can be revoked at any time by the individual who created them, should they regain the ability to make decisions for themselves.
When to set up Lasting Powers of Attorney?
While it is true that most cases of loss of capacity take hold in the later years of one’s life, often due to dementia, if you play sports/extreme sports or have a potentially hazardous line of work, you may find yourself needing an LPA a lot sooner than you’d imagine. Accidents can leave people disabled in a matter of seconds.
Also, if you cycle, ride motorcycles, or drive a car and undergo an accident which keeps you physically incapacitated in a hospital bed for weeks or months, you could be in dire need of a Property & Financial LPA to manage your affairs.
It can also be lifesaving for your spouse with whom you have a joint bank account. Some banks, if they learn that one of the owners of a joint account has lost capacity, freeze the account as one of the account holders can no longer consent to use the funds held in said account.
Nobody can tell the future, so it is worth being prepared just in case
LPAs can be incredibly beneficial in ensuring that your wishes are carried out and that you receive the best possible care if you lose the ability to communicate or make decisions for yourself. If you would like to put an LPA in place, we can help. Our team of experts will work with you to ensure that your wishes are accurately reflected and that all necessary steps are taken to create a legally binding document.