As a society, we are generally good at ‘forward thinking’ and planning for the future, with even today’s younger generations generally aware of the need to plan carefully for retirement and old age. However, there’s one area where we’re bucking the trend: our commitment to making concrete plans for our care and support with financial affairs should something happen to us that impairs our mental capacity to the extent that we are unable to make the decisions ourselves.
Making arrangements for the unexpected
Understandably, it’s a difficult situation to think about: no one wants to address the possibility of an accident or illness which subsequently impacts their ability to make decisions themselves.. However, it’s an important consideration: who would you like to appoint to make crucial decisions for you in relation to your health and welfare or your property and financial affairs, should you be unable to make these yourself? How would such an arrangement help reduce the burden of stress in such a situation?
In the UK, a Lasting Power of Attorney (‘LPA’) is a way of giving someone, the Attorney, the legal authority to make decisions on behalf of another (the Donor). ‘In the UK, it tends to be the older generation that put LPA’s in place because as people get older, they recognise the merit in preparing for a time when they may not be able to make decisions themselves as a result of an impairment of the mind caused by an illness or an accident. That said, we strongly believe that there is a real value in making these preparations in advance – whatever age you are. Getting married, having children or simply getting your affairs in order are all perfect times to think about creating an LPA,’ says Stuart McLuckie, Managing Director ZEDRA Cheshire.
There are two types of LPA which are available in the UK. The first is a Property and Financial Affairs LPA, and the second is a Health and Welfare LPA. A Property and Financial Affairs LPA would allow your Attorney to make decisions in relation to all of your financial affairs, unless you choose to restrict this power in the document. For example, it provides the Attorney with the power to pay bills, buy and sell property, pay a mortgage, arrange and pay for repairs to property and manage bank accounts and investments per any needs that arise. This type of LPA can be used by your Attorney should you lose capacity or if you simply wanted them to start to act on your behalf. A Health and Welfare LPA covers decisions concerning physical and medical interventions as well as those relating to well-being. They can only be used to make decisions on your behalf when you are unable to make those decisions yourself.
As soon as your LPA has been signed, it should be registered with the Office of the Public Guardian (‘OPG’) so that it is available for your Attorney to use immediately when you need them to act. Without an LPA in place, should you be unable to make decisions yourself concerning assets, health and welfare, someone would need to apply to the Court of Protection to become your Deputy. A Deputy has the same powers as an Attorney, although the court can choose to restrict these powers. The Court decides who should be appointed as your Deputy unlike an LPA that provides you with the freedom to choose who you want to act in this important role, ahead of time. The court application is often expensive and the process can be lengthy, which can lead to stress for you and your family at an already difficult time.
‘Today, personal finances are more complex, and children often live away from their parents. As a result, we see more demand for a professional Attorney such as ZEDRA, who can deal with property and financial affairs. Central to our role as professional Attorney is to provide these services with compassion, empathy and understanding, recognising that we may be providing these services to vulnerable people,’ says Stuart. ‘Our clients benefit from knowing that should they need us to act on their behalf, their affairs will be handled by a trusted, professional party with significant experience who has their best interests at heart and can support them in their time of need,’ adds Stuart.
For more information, please contact Stuart McLuckie, Managing Director ZEDRA Cheshire.