Thinking about Lasting Power of Attorneys (LPAs) is not just something older people need to do – everyone should write one, in my opinion
Let’s be honest, writing a will and an LPA isn’t top of anyone’s to do list – it isn’t even at the bottom. But it’s important, not just so that someone will have your best interests at heart should you fall ill or be in an accident, but also so thT your loved ones know who should be making the big decisions if you’re not able to. If you’ve lost your mental capacity, it’s too late and your loved ones may struggle to gain control of your affairs.
It’s a grim truth that accidents can happen at any age, which is why putting together an LPA is something young people should consider, as well as old, including the four in ten Britons who feel they’re too young and healthy to need an LPA, identified in recent research by SAGA.
So what is an LPA?
It’s a way of giving legal authority to someone you trust to make decisions on your behalf should you lack the mental capacity to make them yourself. That could be a temporary loss of mental capacity – or permanent.
There are two types of LPA – one for health and care decisions and the other for financial. Under the former, your chosen attorney can make decisions about your medical care and where you live, whilst under the latter the choices will be around buying and selling property as well as paying bills. They have to be set up individually and registered with the Office of the Public Guardian, at a cost of £110 each. If only one is relevant, then only set up one – for young people the health and care decisions of an LPA is possibly more relevant in case of sudden illness or accident; however that will also depend on your particular financial arrangements.
You can find all the information you need as well as the LPA forms to download at www.gov.uk. However, lots of people use solicitors and will writers to help navigate them as they are legally binding documents and certain wishes may have to be drafted carefully – for example, you may want to limit what your attorneys can do, which isn’t uncommon.
Here we have been helping people write LPAs since we started in 2012. Call us now on 0151 559 0695 for advice to ensure that, should you become incapacitated, your life is in the good hands of people you love and trust.
If you have a draw-down pension – that is a pension pot that you draw from as opposed to an annuity – then it is essential that you consider setting up a Lasting Power of Attorney (LPA). The point about a draw-down pension is that it requires ongoing management until you die. For most people who are now retired it is likely that at some point they will be in a position where they are unable to do so on either a temporary or permanent basis. This means that, without the appointment of an attorney, they will be unable to instruct their adviser on making any alterations to their draw-down arrangements, with potentially devastating impact on the financial situation of themselves and their family.
There are two types of LPA, a Health and Welfare, and a Property and Financial Affairs. You can find out more by clicking through here. However you can only set one up whilst you have the mental capacity to do so. The alternative is for your relatives to apply to the Court of Protection for the appointment of a Deputy to manage your affairs; not only is this a slow process that could leave your family in financial difficulty in the meantime, or mean your investments lose significant value because your advisers were unable to manage them, but it is also much more expensive than making an LPA. Typically it could cost you (since the fees will eventually be drawn from your assets) upward of £2000, with ongoing costs on an annual basis. Clearly it is much better to sort this out now whilst you can select who you want to act as your attorney, rather than leaving it to others to do.
For more information contact me using the form, or call me on 0151 559 0695. Whatever you do, don’t delay.
<script>
Sir Jackie Stewart announced in June that his wife Lady Helen Stewart is suffering from dementia
The world champion Formula One driver explained that his wife of 55 years now requires around the clock care. Lady Helen, 75, was diagnosed with dementia 2 years ago, but this is the first time the racing driver has spoken about the changes he has seen in his wife.
Whilst he believes it is too late to help Lady Helen, he has launched a charity named Race Against Dementia to seek a cure for dementia sufferers in the future.
According to the Alzheimer’s Society 225,000 Britons each year are diagnosed with the condition.
It further highlights the need for people to have LPAs (Lasting Powers of Attorney) in place.
There are two types of LPA that currently exist, the first of which is a ‘Health and Welfare’ LPA. This type of LPA can only be used in situations where the donor does not have the mental capacity – the ability to make decisions for themselves and cannot be invoked otherwise. There is some flexibility as to the extent of the powers the LPA can grant – the appointed attorneys can only make specific decisions if you outline it to be so, for example making judgements such as daily routine and diet, right through to moving into supported care or agreeing to lifesaving medical treatment.
As well as the Health and Welfare LPA, there is the ‘Property and Financial Affairs’ LPA, which as the name suggests links directly to the personal property and money of the donor, and what the attorney can do with it. A Property and Financial Affairs LPA can be used immediately upon registration, there is no requirement for the lack of mental capacity.
Many people opt to make both types of LPA, though there is no necessity to do so, you can opt to only make one or the other.
If mental capacity is lost prior to making a Lasting Power of attorney it can cost thousands of pounds through the Court of Protection with fees starting from £400, plus legal fees, insurance and supervision fees. It is cheaper and more straight-forward to do so whilst you are able.
To appoint an LPA please contact me using the form below.
