No one wants to think about what would happen if they lost mental capacity and could no longer manage their affairs. But if you don’t appoint someone to have power of attorney, this could mean a complete stranger will one day make decisions regarding your future.
This is a depressing statistic but one worth thinking about: figures from the advice site MyAgeingParent.com show that dementia affects one in three people aged 65 and over at some point.
People assume there is an automatic right for their next of kin to make decisions on their behalf if they are no longer able to do so, but this is not the case.
In this scenario, a Lasting Power of Attorney is the piece of paper that can make all the difference and, as of last month, it has become much easier to set one up (see box).
“Everybody should consider having an LPA,” says family justice minister, Caroline Dinenage. “If you can’t make decisions – through an accident or illness – having one allows you to choose someone you trust. ”
While this legal document is just as essential as a will, research by the Office of the Public Guardian found that 45% of the over-45s are not aware of LPAs; separate findings from Saga Legal Services reveal that two thirds of Britons haven’t drawn one up.
So how does it work?
An LPA lets you nominate one or more people to handle your property and financial affairs, and to make decisions about your health and welfare.
The former type of LPA involves matters such as managing bank accounts, paying bills, collecting benefits and selling your home, while the new ones include vital decisions around things such as your daily routine, medical care, choice of care home, and whether or not to have life-sustaining treatment.
You can choose the same person – or people – for both types, or different ones for each.
Most people choose trusted family members or close friends who are familiar with their circumstances.
“If you have multiple attorneys, they can be ‘joint’ or ‘several,’” says Emma Myers from Saga Legal Services. “Joint attorneys must all agree to any decision made, while several means any one can make a decision.”
An LPA is commonly viewed as something you only set up when you need it. However, it is far more sensible to set one up well before it is actually required.
“If you become incapacitated and there is no LPA in place, someone – usually a relative – must apply to the Court of Protection to become a deputy before they can deal with matters on your behalf,” says James Antoniou from the Co-operative Legal Services. “This can be a long and expensive process at what can already be a very stressful and emotional time.”
Many people in this situation are often in shock and ill-prepared for the legal and financial challenges they face.
June Woodward, 80, decided to put an LPA in place, having witnessed her brother, William Cowell, struggle in his dealings with the Court of Protection.
“The problems arose when William’s mother-in-law was taken into care after being diagnosed with Alzheimer’s,” says June, who lives in Epsom, Surrey. “She was deemed unable to act and make decisions, but hadn’t arranged an LPA; this meant the Court of Protection took control of her finances and other affairs.
“While my brother and sister-in-law applied to become deputies so they could buy necessities, such as clothing and toiletries, they had to keep receipts and submit annual statements to the courts. The whole situation was very stressful, as the Court of Protection still had the final say. It left my brother feeling totally helpless.”
Having been through this experience with a close family member, June decided it was vital to get her own LPA. After spending some time researching the various options and charges, she arranged it through Saga Legal Services.
June says it has given her great peace of mind. “I wanted to ensure that should anything happen to me, it will fall to my son or daughter to make decisions on important matters,” she says. “I want someone I trust implicitly doing this, rather than a ‘faceless’ stranger. That way, I can be sure that the choices are in my best interest.”
It makes sense to arrange the paperwork when you’re still young, just in case the unthinkable happens, such as a car crash. You must still have all your mental faculties and be capable of making decisions – and you must be able to sign it.
“It’s a sensitive subject,” says June Whitfield, solicitor and chair of the Law Society’s wills and equity committee. “But acting now will relieve a massive amount of stress later. It could be the difference between paying a few hundred pounds now, or a few thousand in the future.”
How to set up an LPA
The cheapest option is to download the LPA forms yourself, or to fill them out online at Gov.uk/power-of-attorney. If you go down this route, the only fee you have to pay is £110 to register the forms with the Office of the Public Guardian.
While the forms are relatively straightforward – there is a step-by-step guide – you do need to take care, as any incorrectly completed forms have to be resubmitted and paid for again.
“The good news is, new simpler and clearer LPA forms were introduced in July,” says Deborah Stone from advice website myageingparent.com. “The new forms reflect feedback from users, and the redesign will make them easier to follow and faster to complete.”
Once the forms are filled out, you need to print them, sign them personally, and have your chosen attorney sign them too.
If you want help and guidance setting up and registering an LPA, you can contact a local advice agency or solicitor. Bear in mind that the legal system in Scotland is similar, but not the same, as the system in England and Wales.
While some solicitors may charge by the hour, some services are fixed-fee. With the Co-operative Legal Services, for example, the cost is £200 (plus VAT) for an LPA that covers both property and financial affairs, as well as health and welfare. With Saga Legal Services, the cost is £258 (plus VAT). In both cases, the £110 fee is then paid on top.
To find a solicitor, visit solicitors.lawsociety.org.uk and for the Law Society of Scotland, visit http://www.lawscot.org.uk
• This article was amended on 26 August 2015 to provide details of the Law Society of Scotland.
