According to the Financial Times, the number of people signing over financial control has more than tripled in the last 5 years.
The number of newly registered lasting power of attorneys (LPA) has risen to 800,000 in 2019. A 192% increase in 6 years.
What is a Lasting Power of Attorney?
Giving somebody power of attorney can give you peace of mind that your affairs will be looked after if you ever don’t have the mental capacity to decide for yourself.
An attorney can make decisions about your finances and your health and well-being. There are two parts to lasting power of attorney – Personal welfare and property and financial LPA’s.
Health and Welfare LPA
A Health and Welfare LPA can allow somebody to decide about your daily routine, medical care, moving into a care home and even medical treatment that sustains life. It can only be used if you’re mentally unable to decide for yourself.
Property and Financial Affairs LPA
A property and financial affairs LPA is exactly as it describes. You can assign somebody the power to make decisions about your money and property. This can include managing your banks accounts, paying your bills, collecting your pension or benefits and selling your home. This can be used as soon as it is registered.
You can have as many as you like
You can only have one lasting power of attorney document, but you can appoint as many LPA’s as you’d like. If you’re appointing more than one, they will have to make all decisions either “Jointly and Severally” or “Jointly” – you decide which.
Acting jointly means that they will have to make all decisions together. Acting jointly and severally means that they can make some decisions together and some individually. You can also specify for them to make some decisions in one way and other decisions another way. For example, you might want them all to act jointly when making decisions about your money but only one person could decide where you should live.
It’s not useable unless it’s registered
Once an LPA has been drawn up you’ll need to register it with the Office of the Public Guardian. This is the government body who look after LPA’s in the UK. Until your LPA is registered, it cannot be used and getting your LPA registered could take between 8-10 weeks.
Dementia develops faster than the time it takes to register an LPA
Dementia is probably the most common reason that causes somebody’s mental capacity to decline quickly. If you don’t have an LPA set up whilst you still have mental capacity, you would need to apply for a Deputyship Order. It can take up to 6 months to gain a deputy order which can grant your loved ones power of attorney, and during this time they wouldn’t be able to make any decisions on your behalf.
It’s never nice to think about what might happen in these circumstances but it’s always better to be prepared should you ever need it.
You have complete control and can state limitations
You can limit your attorney’s powers by clearly stating your instructions or wishes in your LPA. However, if you do become mentally incapacitated, you won’t be able to lift any limits or grant additional powers. This is something worth considering so that you don’t restrict access to any parts of your life that might need managing.
You’re protected and can’t be coerced into assigning LPA
A professional or someone you trust must verify that you know what you’re agreeing to and that you’ve not been forced into signing an LPA.
It’s ‘lasting’ for a reason
Your LPA won’t go out of date and as long it is registered can be used at any point of your life if you lose your mental ability to make decisions. You may never need it, but it’s always better to be prepared and to ensure that your wishes are carried out as you want them to be. Especially as these decisions have a direct affect on your life and health.
Our Private Client Team make it easy, taking you through some simple questions at your own pace, to create your Lasting Powers of Attorney. Find out more here.