what is a Lasting Power of Attorney (LPA)?

A LPA is a legal document that enables a chosen attorney to look after your affairs or make decisions on your behalf if you are incapacitated. In other words it allows you to grant somebody else the power to act on your behalf, looking after your affairs and making decisions whilst you are unable to.

LPAs are thought to only be useful and appropriate for use with the elderly. However, this is a misconception that needs to be addressed and the younger generation need them too, especially those who participate in sports and other physical activities.

Currently only 6% of the population have powers of attorney, even though they are as important as having life insurance, pet insurance and home insurance.

There are two types of LPA:

• Property and Financial Affairs; this document allows an attorney to deal with all financial matters (i.e. property, money and investments).

• Health and Welfare; this document allows an attorney to make medical decisions on your behalf.

Choosing the right attorney is imperative. You can choose anyone of sound mind over the age of 18 years old. You should choose someone you trust, that is responsible and will take the responsibilities of being your attorney seriously.

Usually people choose their spouse, children, relative or trusted friend to be their attorney. We suggest choosing someone close to you rather than a professional, however some professional services are available for the Property and Financial Affairs LPA.

You can choose more than one, and specify how decisions are to be made, whether ‘jointly’ or ‘jointly and severally’. The latter meaning they can act independently of each other

why do I need a Lasting Power of Attorney?

If you become incapacitated, then you will need someone to manage your affairs. Without a LPA you have no one designated to do so and would need to go through the Court of Protection to gain the authority, which could take months and is extremely costly. It is likely to cost thousands of pounds to get the authority to make your decisions should the worst happen.

Many think that it does not affect them because they have a joint account with their partner or spouse. This is untrue, the British Banking Association explicitly advise that consumers get a LPA as a joint account will be frozen if either party is incapacitated. Without the LPA, you would need to get an Order from the Court of Protection.

The British Banking Handbook states:

‘If the other joint-account holder becomes mentally incapable, the bank or building society must get an order from the Court of Protection (in England and Wales), which protects the rights of mentally incapacitated people, before they can let you use the account.’

Most worryingly this means you may not be able to pay mortgage payments, household bills and afford day to day necessities.