We use some essential cookies to make our website work properly.
We’d also like to set additional cookies to help us improve our website, tailor marketing and provide a more personal experience.
Your free estate planning review
ⓘ What's in this guide?
If you’re wondering “What does power of attorney mean?”, we can explain. A lasting power of attorney (LPA) is a legal document which gives the person(s) of your choice the power to deal with your affairs. These trusted people will become your legally appointed attorney(s) and will be able to use these documents to act on your behalf whenever necessary.
LPAs are important in the event that you may not be able to express how you want your financial affairs and/or health and welfare to be taken care of. An LPA allows you to choose a person(s) to make these decisions on your behalf and in your best interests.
There are a number of reasons why you may want or need someone to make decisions or act on your behalf. Perhaps it’s only a temporary situation while you’re in hospital and need help with everyday tasks such as paying household bills. Or it could be because you need to make a longer-term plan. If, for example, you’ve been diagnosed with dementia or Alzheimer’s and you may lose the mental capacity to make your own decisions in the future.
Depending on your situation, you may also consider a Will or a living Will:
Mental capacity is the ability to make or communicate specific decisions at the time they need to be made. To have mental capacity you must fully understand the decision you need to make, why you need to make it and the likely outcome of what you decide.
It’s important to remember that needing more time to understand or communicate your decision doesn’t mean you lack mental capacity. For example, if someone has dementia, it doesn’t necessarily mean they’re unable to make any decisions for themselves. If, for whatever reason, someone is having difficulty communicating their decision, attempts should always be made to overcome these difficulties to help the person decide for themselves where possible.
If they can’t, this is where a lasting power of attorney would step in to make sure their wishes are made clear.
Many people believe that family members or partners will be able to automatically make decisions on their behalf when they are no longer able to do so themselves. Contrary to popular belief, married or co-habiting couples are not automatically able to legally deal with each other’s affairs.
Taking out a lasting power of attorney and appointing your partner ensures they have the authority to act on your behalf should you require it. Legally, being married or co-habiting doesn’t afford you the right to:
-
Access any bank accounts
-
Speak to pension providers or credit card companies
-
Query bills with utility companies
-
Make a decision about healthcare
Without having a valid LPA in place naming your partner as your nominated attorney, they may find themselves powerless to help you.
Speak to the team at Key today to see how we can help you and your family with any will or lasting power of attorney needs.
An LPA gives the person(s) of your choice the power to deal with your affairs when you're unable to do so. Find out more about how an LPA works below.
- You can choose people you trust – giving you the power to ensure your estate is being taken care of by someone you can count on to do it. Whether it be a family member, a close friend or solicitor
- Even if you’re married, you aren’t entitled to deal with your partner’s affairs – your partner could be powerless when it comes to making decisions to do with your finances or medical care
- They last a lifetime – your LPA will protect your estate until you pass away, and then your will takes over
- You should leave yourself plenty of time to set up and register your LPA – the registration process with the Office of the Public Guardian can take up to 20 weeks
- Key recommend you appoint at least two attorneys. The first, for example, could be your spouse or partner and the second a son or daughter
- LPAs can be temporary or permanent depending on your situation
Back to "What's in this guide?"
In England and Wales, there are two types of LPAs which deal with entirely different aspects of your life: Property and Financial Affairs, and Health and Welfare. You can choose to have both or just one on its own.
Property and Financial Affairs LPAs deal with your money and property and can be used while you still have full mental capacity. An LPA for financial decisions can cover things such as:
-
Buying and selling property
-
Paying your mortgage
-
Investing money
-
Paying bills
-
Arranging any repairs to your property
Your attorney must keep accounts of any financial decisions and ensure their money is kept separate from yours. You have the right to ask for regular details of how much is spent and how much money you have.
Health and Welfare LPAs deal with your wellbeing/care issues and can only be used once you are unable to make decisions yourself, not before. An LPA for health and welfare decisions can cover things such as:
-
Where you should live
-
Your medical care
-
What you should eat
-
Who you should have contact with
-
What kind of social activities you should take part in
You can also give special permission for your attorney to make decisions about life-saving treatment.
| Feature | Property and Finance | Health and Welfare |
|---|---|---|
| Act on your behalf | ✓ | ✓ |
| Deal with bank accounts | ✓ | |
| Sign paperwork related to equity release | ✓ | |
| Deal with utility bills | ✓ | |
| Deal with solicitors | ✓ | |
| Discuss medical issues with your doctors | ✓ | |
| Make decisions about healthcare | ✓ | |
| Deal with social services | ✓ |
At Key, we can help you and your family make sure all your affairs are in order. We are offering a free, no-obligation consultation with one of our estate planners to create your Lasting Powers of Attorney.
To take the first step, why not book a call with one of our estate planners. It's free and there's no obligation to proceed. You'll have the chance to ask any questions you may have, and they can talk you through your options.
Setting up an LPA can feel like a daunting task, but Key are here to help you through the entire process. Of course, with such a complicated subject, there comes plenty of questions. Here are some answers to the most common ones we get asked:
There’s one key difference between the two. An ordinary power of attorney is only valid while you have the mental capacity to make your own decisions. Whereas if you want someone to be able to act on your behalf, if there comes a time when you don’t have the mental capacity to make your own decisions, you should set up a lasting power of attorney.
You may be exempt from paying the fee or be offered a reduced fee if you’re on a low income or receive certain benefits, so it’s always important to check.
If you choose to instruct a solicitor to act on your behalf or to oversee any paperwork and legal documents, you’ll also have to pay legal fees.
If, for whatever reason, you lose the capacity to make your own decisions and don’t have a lasting power of attorney in place, someone will need to apply to the Court of Protection on your behalf.
The court can then:
-
Decide whether or not you have the mental capacity to make a decision
-
Make an order relating to the health and care or property and financial decisions of someone who lacks mental capacity
-
Appoint a deputy to make decisions on behalf of someone who lacks mental capacity
These pages give a general overview of the issues surrounding estate planning and are based on our understanding of the current law and tax regulation in England and Wales, which may be subject to change. Estate Planning activities are not regulated by the FCA.
Page last updated: Friday 13 September 2024