We might all ask ourselves at some point in our lives, what happens if I’m unable to look after myself in the future? What would happen if I can no longer deal with my money and pay my bills? What happens if I lose capacity? Fortunately, should these events ever happen, you can plan ahead for them.
During your lifetime and whilst you have mental capacity to give instructions, you can set up legal documents to ensure the smooth process of looking after your money, finances, property and investments, as well as taking care of your more personal needs in considering how you how you should live and be cared for in later life.
What is a lasting power of attorney?
A lasting power of attorney is a document created for use during lifetime. Its purpose is to convey power to your attorneys to effectively “step into your shoes” and look after matters on your behalf.
Types of lasting power of attorney
There are two types of lasting power of attorney, “Property and Financial Affairs” which does exactly what it says on the tin and includes anywhere you hold money be it in property, investments or shares for example. This document can be used either whilst you still have capacity, but will also cover you if you lose mental capacity.
The other type of lasting power of attorney is one that covers “Health and Welfare” which can only be used by an attorney if you have lost capacity. This looks after such matters as what care you might receive, where you live, diet and clothing; all those personal decisions that you would make yourself had you retained capacity.
Mental Capacity Act 2005
One very important aspect of these documents is the Mental Capacity Act 2005 which governs them, and contains 5 guiding principles. The overriding principle is that your attorneys must act in your “Best Interest” when making decisions for you. This means they must consider your wants and needs as paramount. This must be the case either while you still have capacity, if you have lost capacity and if you make a decision that they might consider unwise.
You must have mental capacity to make these documents. A solicitor will have excellent knowledge of the workings of this document and will be able to guide you through the process of making and registering your lasting power of attorney. You will need to decide on who to appoint as attorneys and you should appoint someone who you trust and who will be able to handle the job in hand. You can decide to notify family members or close friends of your making the document so that there is transparency and knowledge within the family network as to who is acting and responsible. You can determine how your attorneys are to act and consider whether this is best jointly, or jointly and severally.
What can I include in my lasting power of attorney?
Lasting Powers of Attorney can incorporate any of your wishes and instructions for the attorneys as to how they should act. You might want them to invest in a particular way, for example only with ethical companies, or you may wish them to consider other factors before making financial decisions for you. Likewise you may have instructions as to where you live and what care you receive and how this should be considered when your attorney is making decisions for you.
Once the document has been prepared and signed by all parties, it has to be registered at the Office of the Public Guardian before it can be used…
We often find our clients are relieved once they have prepared Lasting Powers of Attorney with us as they know that they have their affairs settled in trusted hands, and should life take a sideways step and they are unable to look after themselves and make decisions, that someone else will be ready to step in.
If you have any questions on lasting powers of attorney or wills, trusts or estate administration contact Mandy Humphrey in our Private Client team on 01737 854 500 or email [email protected]