The Ultimate Guide to Lasting Power of Attorney

The Ultimate Guide to Lasting Power of Attorney

When it comes to making decisions about someone’s health or finances, power of attorney is a key player in ensuring these important areas remain in appropriate hands.

By organising a lasting power of attorney, an individual is able to give someone they trust the legal authority to make decisions on their behalf. This authority comes into play should you lose the mental capacity or willingness to make decisions for yourself.

At Hansford Bell, our financial services are provided with people at the heart of everything we do. In this blog post, we offer the ultimate guide to lasting power of attorney, outlining what it is, who it is relevant to and the implications it has on a person’s finances and decision-making abilities.

Get in touch today for a free consultation!

What is Power of Attorney?

Broadly speaking, power of attorney is a legal document that allows someone to make decisions for you or act on your behalf in the event of you becoming unfit or unwilling to make decisions for yourself.

While this is the overarching definition of power of attorney, there are three main varieties which cover specific cases – these are ordinary power of attorney, lasting power of attorney (LPA), and enduring power of attorney (EPA).

Lasting Power of Attorney for Health and Care

Lasting power of attorney for health and care decisions can only be used once an individual has lost mental capacity. In this scenario, the nominated person known as the ‘attorney’ is able to make decisions regarding:

  • Where the individual should live.
  • What medical care they pursue or accept.
  • Their diet and socialising schedules.

Health and care power of attorney can also make an attorney responsible for making decisions about life-saving treatment.

Lasting Power of Attorney for Financial Decisions

Lasting power of attorney for financial decisions can come into effect when an individual still has mental capacity. Alternatively, they can state that they only wish for it to come into action in the event of them losing said capacity.

An LPA for financial decisions covers things such as:

  • Buying and selling property.
  • Paying a mortgage.
  • Investing money.
  • Paying bills accounting for other property expenses.

The authority of a selected person can be customised to cover just a few financial elements or all of them.

If you’re setting up an LPA for financial decisions, your attorney must keep accounts and make sure their money is kept separate from your own. You can ask for regular details of how much is spent and how much money you have. These details can be sent to your solicitor or a family member if you lose mental capacity.

You may be able to improve your financial situation with our ultimate guide on choosing the right ISA. >

What is Mental Capacity?

When discussing the grounds for lasting power of attorney, the term ‘mental capacity’ is frequently mentioned – but what does it refer to? Mental capacity pertains to an individual’s ability to make decisions at the time they need to be made. This includes understanding:

  • What decision is being made.
  • Why it needs to be made.
  • What the outcomes of the decision may be.

An individual may lose mental capacity for a variety of reasons, such as from the development of cognitive conditions or simply due to old age. Should it be required, an individual’s GP can be contacted to organise an assessment of mental capacity.

How Do I Make a Lasting Power of Attorney

In order to create a lasting power of attorney, an individual must be over 18 years old and have the capacity to make decisions you are authorising an attorney to make. There are designated forms available for making a lasting power of attorney which can be filled out either online or by hand.

Alternatively, it is possible to see support from a solicitor or other industry professional. It is at this stage that an applicant will decide whether their lasting power of attorney will cover finances, health and care, or both.

How to Choose an Attorney

The role of attorney involves a large amount of power and responsibility. For this reason, it is important to choose someone that you have a strong, trusting relationship with.

When selecting your attorney, it is advised that an individual gives their nominated person ample opportunity to consider the role before accepting. This allows them to have time to understand the responsibilities of the role and what it might entail.

Your attorney could be a family member, friend, spouse, partner or civil partner. It is also possible to appoint two attorneys to operate jointly.

Financial Advice with Hansford Bell

Hansford Bell are financial specialists with a personal approach. We take the time to get to know our clients and help them understand what their financial needs and goals are – supplying the necessary support to help them achieve these goals.

We have experience with a large variety of clients with a range of different needs and are on hand to offer impartial, independent advice. Our strategy combines simplified, straightforward tips and guidance with cutting-edge technology and a comprehensive understanding of your situation.

Our services help you focus on your finances, so you can focus on living your life. Keen to speak to a member of our team? Get in touch today.

Plan for inheritance tax in advance by reading our blog post. >

Read on with our ultimate guide to capital gains tax. >

Note – this article is for information only and does not constitute advice.

A Fresh Approach to Financial Planning and Advice.

Hansford Bell aren’t your average team of financial specialists. We take the time to get to know our clients and help them realise what they want from their life, whether that’s a personal ambition or a financial goal.

Our planners are highly experienced and know the industry inside-out. We combine simplified, straight-forward tips and guidance with cutting-edge technology and a comprehensive understanding of your situation. We focus on your finances, so you can focus on living your life.

Want to know more? Talk to us today and we can start making that dream future a reality!