Ever wondered what would happen if you lost your ability to make decisions?
Not a pleasant thought; but life is unpredictable. There’s always a risk that you could have a severe accident or develop an illness that leaves you debilitated. If you lost your mental capacity, who would make the crucial choices – regarding finances and health – on your behalf?
This is where a lasting power of attorney (LPA) comes in.
A rising number of registered LPAs
An LPA is (by far) the simplest way to plan for the future.
Essentially, it’s a legal document that allows you to appoint someone you trust to make decisions and manage your affairs – if or when you can no longer do so for yourself.
Over the last few years, LPA registrations in the UK have been worryingly low. Research has found that only one in three ‘baby boomers’ have selected a power of attorney – and according to official figures, less than 1% of the overall population has an LPA in place.
However, it looks like things are now starting to improve. New data released by the Ministry of Justice has revealed that the number of LPAs registered in the first quarter of 2023 is up by 33% – compared to the same period last year. And approximately 270,000 LPAs were registered between January and March alone.
Perhaps, in a post-pandemic world, people are starting to realise the importance of future planning? Maybe this increase is due to the increased publicity for LPAs? Or because application processing times have finally started to reduce (with most now completed in under 18 weeks)?
Whatever the reason, it’s welcome news.
Do I need a power of attorney?
The short answer is yes, probably. LPAs aren’t reserved for the elderly and those in poor health. Realistically, countless scenarios in life could lead to the loss of your mental capacity.
For example, common illnesses such as cancer, heart disease and strokes can all – sometimes very suddenly – make us dependent on other people. More than 900,000 people in the UK have dementia, which is predicted to rise to more than 1.6 million by 2040. And as for accidents, someone is admitted to hospital every 90 seconds in the UK with a brain injury.
The bottom line is – your current age and health are irrelevant.
You certainly shouldn’t wait until later in life, or when your mental capacity has already started to deteriorate, to appoint a power of attorney. In fact, by then, it’s too late. LPAs can only be registered whilst you’re of sound mind – which means it’s always better to act sooner rather than later.
What will happen if I don’t appoint a lasting power of attorney?
A commonly held misconception is that the responsibility would automatically fall to your next of kin. That’s a logical assumption; but unfortunately, it just isn’t the case.
If you lose the ability to make decisions and haven’t created an LPA:
- A deputy will be selected on your behalf
In the eyes of the law, you may no longer have the mental capacity to choose who makes your decisions going forward – so this becomes the responsibility of the Court of Protection.
They will appoint a ‘deputy’ to make any financial, health or welfare decisions on your behalf, which will usually be a solicitor or accountant. Certainly not someone you’re likely to have chosen yourself.
- You won’t have control over your future
One of the main benefits of an LPA is that it allows you to have a say in your future.
You can leave instructions for your power of attorney, such as which care home you’d prefer, which treatments you’d like, how much you’d like to pay towards your child’s university fees, etc. These can even be legally binding, so you can feel confident that any decisions made reflect your wishes.
However, without an LPA, these crucial decisions become the responsibility of a stranger. Someone who doesn’t know you as a person or what you would have wanted in those circumstances.
- Your family or friends might have to go to court
To make any decisions on your behalf, your loved ones would have to apply for a ‘deputyship’ at the Court of Protection. Not only does this cost more than an LPA (£365 plus fees), it can take up to 3 months to complete – often causing a lot of additional stress at an already difficult time.
Until deputyship is granted, they would also be unable to gain access to your bank accounts – which means, they may struggle financially to keep up with the mortgage or pay other essential bills.
What type of decisions can a lasting power of attorney make?
There are two types of power of attorney, which cover two distinct areas:
1. A property and finances LPA
This gives your attorney the power to make decisions regarding any properties you own and all financial matters, such as paying bills, managing bank accounts and investments, collecting any benefits or a pension, buying, selling and maintaining property, giving gifts on your behalf, etc.A health and welfare LPA
2. A health and welfare LPA
This allows your attorney to make decisions regarding your day-to-day health and medical treatment, plus your personal welfare. It covers things such as where you live, what happens to your pets, whether you accept medical treatment to keep you alive beyond a certain point, etc.
It’s important to note, neither of these LPAs will give your chosen person total control over you.
Whilst you still have mental capacity, your attorney must act solely on your instructions – and you can cancel the LPA at any time. In the original legal document, you can specify exactly which decisions you’re happy for them to make – and those which they can’t. And if you do lose your mental capacity, they still have to involve you as much as possible in any decisions.
By law, your attorney cannot pay themselves a fee (unless you’ve permitted this), make big gifts of money to people, combine their finances with yours, manage discretionary funds with a fund manager or get involved in any sort of tax planning. Above all, they have one legal rule to follow:
To make decisions in your best interests, not their own or anyone else’s.
Contact our lasting power of attorney solicitors
Ready to join the thousands of people who have already registered an LPA this year? We’re on hand and ready to help.
Technically, you don’t need a solicitor to appoint a power of attorney. The relevant application forms can all be found online, along with guidance from the Office of the Public Guardian (OPG) on how to fill them out.
However, it’s worth keeping in mind; although the application may appear relatively straightforward, there are many potential stumbling blocks – which can often cause lengthy delays. And given the important nature of an LPA, it’s usually advisable to recruit the help of specialist power of attorney solicitors.
More information on the benefits of using an LPA solicitor can be found in our previous blog.
Here at St Helens Law, we’re highly knowledgeable and experienced in this area of the law. Our wills and probate team can assist with all aspects of making your LPA, from selecting the right person to accurately reflecting your wishes.
We can also guide you through the registration process, avoiding any unnecessary hold-ups and ensuring it’s completed as quickly and seamlessly as possible.
If you’re still unsure whether to register a lasting power of attorney or have any questions, please don’t hesitate to contact us. You’re welcome to call us at any time on 01744 742 360. Alternatively, send an email to email@example.com and we’ll get back to you with further information.
If you’ve decided an LPA is right for you and would like to take the first step, you can also request a free initial consultation with our lasting power of attorney solicitors by filling out our enquiry form.