Why do I need a lasting power of attorney?

A power of attorney is the main estate planning documents to protect you whilst you are alive. It’s a document created by an individual to appoint a person of their choice to look after their affairs at a later point in life (attorney). This could be due to the fact that they no longer wish to make these decisions themselves, or it could be that they lack the capacity to due to ill health.  

Many people make the mistake of believing that a power of attorney should be arranged when you fall ill and are unable to manage your own affair. However, it is best to arrange one while you are healthy and well so that it is registered with the Office of the Public Guardian (OPG).

There are two types of lasting power of attorney. The first is ‘Lasting Power of attorney for Health and Welfare’ which allows the Attorney(s) to make decisions regarding things like care issues or consenting to life sustaining treatment. The second type is ‘Lasting Power of Attorney for Property and Financial Affairs’. This allows the Attorney(s) to make financial decisions, for example, selling property or dealing with investments, managing bank accounts and paying bills etc. Both of these types of Attorney continue to be valid even after the donor loses all mental capacity.   You can also add guidance and restrictions to your chosen Attorneys. This will give them an idea of how you want them to act, however, it is not legally binding.

Whilst a Will ensures that your assets go to the correct people when you die, a Power of Attorney looks after them and yourself whilst you are still alive. If you were to become unable to make decisions yourself unexpectedly, an application must be made to the Court of Protection for Deputyship by a relative or someone close to you. This can be very time and consuming and expensive (£2000 estimate per application) and the Judge’s final decision may not be one you would have liked. This stresses the importance of making a Lasting Power of Attorney to ensure that the correct person has the final say.

So if you want to make sure that someone you trust makes your decisions if you are ever unable to, then talk to one of our estate planning advisors. We can arrange a consultation to discuss your needs and ensure that you have peace of mind when you need it most. Call the Assured Wealth and Estate Planning team today on: 0843 515 5161 (local rate call).

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