Peace of Mind in Later Life – Part 1: Why do I need a Lasting Power of Attorney?
Putting in place the right plans for the future is extremely important to ensure you have peace of mind in later life. Part 1 of this blog series concentrates on the arrangements you can put in place if you are unable to make decisions. Part 2 and 3 of our Peace of Mind in Later Life series will cover the plans you might consider putting in place to protect you against Inheritance Tax and the best arrangements to put in place for Care Fees.
The majority of people know that putting in place a Will is the right thing to do as dying without a Will can leave your family with a lot of problems. What people often don’t consider is what happens if they lose the ability to make their own decisions. Losing the ability to make your own decisions can happen because of a variety of reasons, for example because of the onset of an illness or condition, such as Dementia, or an accident.
No one likes to think about the possibility of not being able to make their own decisions, especially when it comes to ones relating to their health and finances. The ability to make your own decisions is referred to as mental capacity and this is governed by the Mental Capacity Act.
The Mental Capacity Act sets out that to make a decision you must be able:
- to understand all the information that is relevant to the decision;
- retain the information;
- use it to make the decision; and
- be able to communicate your decision
Illnesses in later life such as Dementia and Alzheimer’s can have an effect on your mental capacity and therefore the ability to make your own decisions.
Lasting Power of Attorney
A Lasting Power of Attorney can be likened to an insurance policy – it ensures you have the right plans in place if you become unable to make your own decisions. A Lasting Power of Attorney is a legal document in which you give authority to another person (known as an ‘attorney’) to make certain decisions on your behalf if you become incapable of making your own decisions.
A Lasting Power of Attorney is split into two areas and these cover decisions relating to:
- Property and Financial decisions
- Health and Welfare decisions
You are only able to put in place a Lasting Power of Attorney when you have mental capacity, you would not be able to put this in place after mental capacity has been lost.
Property and Financial Affairs Lasting Power of Attorney
In a Property and Financial Affairs Lasting Power of Attorney you can give the person that you appoint as your attorney(s) the right to make decisions relating to your finances if you’re no longer able to do so. An example of the tasks that your attorney(s) may need to carry out are dealing with your bank accounts, paying bills and collecting income/benefits etc. Bigger decisions that may need to be made by your attorney could be organising the sale of a property.
For a Property and Financial Affairs Lasting Power of Attorney your attorney(s) can also complete tasks and make decisions on your behalf if, for a period of time, you may be unable to do so. For example, if you’re in hospital or out of the country.
Health and Welfare Lasting Power of Attorney
You can also appoint an attorney(s) to makes decisions relating to your health and welfare if you do not have the mental capacity to make these decisions. Within a Health and Welfare Lasting Power of Attorney you can give your attorney(s) the authority to make decisions relating to where you live and the care you receive, liaising with the medical professionals and making decisions about life-sustaining treatment. You can document your exact wishes within the Lasting Power of Attorney to ensure different situations are considered.
Unlike a Property and Financial Affairs Lasting Power of Attorney, the attorney(s) you appoint to make decisions relating to your health and welfare can only make these decisions when you lack the mental capacity to be able to make them yourself.
What happens if you don’t put in place a Lasting Power of Attorney and lose the ability to make your own decisions?
You may think that if you lose the mental capacity to make decisions, without putting in place a Lasting Power of Attorney, that your family and/or friends can make decisions for you. Unfortunately, this is not the case. If you lose capacity and you don’t have a Lasting Power of Attorney in place then your family or friends would need to apply to the Court of Protection to make decisions on your behalf. This process can be extremely complex, costly and take a long time.
If you decide to put in place a Lasting Power of Attorney, you will need to choose the right person or people to be your attorney(s) and you may also need to consider having replacement attorneys. Renaissance Legal provide Professional Attorney services and can also act for you as your attorney.
We specialise in putting in place Lasting Power of Attorneys to protect our clients in later life. Our expert team are able to advise you on the right approach for your individual circumstances to ensure that you are able to feel confident in the choices that you make. Please contact us for more information.