Why you should have a Lasting Power of Attorney

Lasting power of attorney

An LPA is a legal document that allows you to appoint one or more persons (attorneys) to help you make decisions in the future regarding your welfare and financial arrangements should you have an accident, an illness or lose the mental capacity to make your own decisions.   

 

Making an LPA is just as important as making a Will. They serve two separate purposes and should not be considered as an either/or. LPAs relate to management of your affairs during your lifetime whereas Wills relate to the distribution of your estate following your death.

 

Why it makes sense to have an LPA

Sadly loss of capacity can happen to anyone at any time, not just through old age, but through accident and/or illness – often things that are completely out of our control. Putting in place an LPA while you are fit and healthy gives you the peace of mind that, if necessary, decisions concerning your welfare and financial affairs are being overseen by someone who you trust and who will be acting in the best interests of you and your family.

 

Do I need an LPA if I have a spouse/partner?

Many people assume that because they are married or in a civil partnership their spouse or partner would automatically be able to deal with their financial affairs and make decisions about healthcare should they lose their capacity to do so. However, without an LPA in place this is not necessarily the case. For example, any assets held in your sole name your partner will not be able to have access to, including ISAs, saving accounts, investments and pensions. In addition, when one account holder of a joint account loses capacity, the other joint holder may not be able to access the funds if there is not an LPA in place.  

 

Types of LPAs 

There are two types of LPA. It is possible to draw up one, or both. The same attorney(s) can be appointed for both or someone different can be appointed for each. They are:

  • Health and welfare, which appoints an attorney to make decisions regarding medical care, future care needs such as moving into a care home, and life-sustaining treatment. It can only be used once the person can no longer make their own decisions.
  • Property and financial affairs, which appoints an attorney to make decisions regarding managing a bank account and investments, paying bills, collecting benefits or a pension and buying and selling property.   

 

LPA for Businesses

If you are a business owner it is important to consider what would happen if you were unable to make decisions. If there is no business LPA in place there may well be issues with bank account signatories, paying creditors and employees and contractual obligations. Without a business LPA in place, an application to the Court of Protection to appoint a deputy to act on your behalf may be needed. There is no guarantee at this stage that the Court will appoint an individual who the business owner would have chosen. This process can also prove more costly and take time, exposing the business to greater risk.

 

Talk to us about making an LPA

At Lentells we can assist with both the procedure of completing the necessary paperwork as well as advising on all the areas you need to consider ensuring the LPA covers all possible eventualities. If you are writing or amending your Will it makes sense to consider putting an LPA in place at the same time.  Alternatively this can be done as a separate exercise at a time to suit you. 

Contact Rob Wegner at our Chard office.

Contact Mike Griffiths at our Seaton office.

Contact Philip Bedford at our Taunton office.