20/11/2024
Imagine life throwing you a curveball. Maybe an accident or illness makes it difficult to manage your own finances or make healthcare decisions. That's where a Lasting Power of Attorney (LPA) comes in. It's a way of letting someone you trust make important decisions on your behalf if you can’t, or don’t want to, make them yourself.
Whether you're a young adult starting a family or a senior planning for your golden years, understanding LPAs can help you feel more secure about your financial future. In this blog series, we'll chat about LPAs and why they're important.
So, What Is a Lasting Power of Attorney?
A Power of Attorney is essentially a legal document that appoints someone you trust – your ‘attorney’ - to make decisions on your behalf.
There are two types of LPAs – one for your health and care, and another for your finances. You can choose to set up one or both, depending on your needs, but to be valid, when creating an LPA, you must be mentally capable of understanding what it means to appoint someone else to make decisions on your behalf.
Think of the health and care LPA as a future plan. It only comes into play if you lose mental capacity to make choices about your own care. This lets your attorney make decisions about things like where you live, medical treatment and the support you receive.
On the other hand, the financial LPA can be used even when you're perfectly capable (but you need to choose this option when setting it up) - your attorney can handle things like paying bills or managing your property. This can be worthwhile in periods of prolonged absence, i.e., if you’re unable to be present to make decisions due to long-term travel or hospitalisation.
Why Is This Important?
A Lasting Power of Attorney lets you choose who will look after your finances, health, and well-being if you’re ever unable to do so yourself. It’s like a safety net, ensuring that the people you trust are the ones making decisions that matter most to you.
Many people assume that if they’re married or in a civil partnership, their spouse or partner would automatically be able to make decisions about their finances, health, or care if they can’t. But that’s not the case—without an LPA, your spouse or partner doesn’t have the legal authority to do this. Instead, they might have to go through a lengthy and costly legal process just to help you. By setting up an LPA, you stay in control of your future and give your loved one’s peace of mind during difficult times.
Who Should Consider Setting Up an LPA?
Anyone over the age of 18 should consider setting up a Lasting Power of Attorney (LPA). While many think it's something only the elderly need, an LPA is valuable for anyone, as illness, accidents, or sudden changes in health can happen at any stage of life. If you have dependents, own property, or want to ensure your finances, health, and personal care decisions are handled according to your wishes, having an LPA in place is important. It’s especially vital for those with a history of health issues, or anyone looking to give their loved ones a clear plan to follow if they become unable to make decisions.
How to Set Up an LPA?
Setting up a Lasting Power of Attorney is easier than you might think, and it’s a good idea to set up both types at the same time: one for health and welfare, and another for property and financial affairs. This way, you’re covered for both managing your finances and making decisions about your care, should you ever need it. Many people choose to do this while they’re reviewing or updating their will—it's a great opportunity to take care of all your planning in one go.
You can do it yourself online through the UK government’s website, or you can use a solicitor to guide you through the process – this helps to avoid problems down the road, especially if you’re unsure of how things work or if your affairs are a bit more complex.
At Owl Financial, We Can Help
Need help with setting up a Lasting Power of Attorney? Our team can connect you with experts who can help. They work with experienced solicitors who are regulated by the Solicitors Regulation Authority, so you can trust that you're getting the best possible service.
Want to learn more? Just ask your Owl Protection Adviser, or find an adviser here. Remember, we're here to connect you with the right people – we don't provide legal advice ourselves.
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