What is Lasting Power of Attorney and do I need one?

Described as ‘more important than a Will’ by Martin Lewis, Money Saving Expert, Lasting Power of Attorney (LPA) is a document to appoint people to act on your behalf should you lose mental capacity.

There are actually two types of Lasting Power of Attorney documents; Property & Finance and Health & Welfare. Generally, there seems to be more of an emphasis on financial LPA’s, but welfare LPA’s are just as important.

When would I need a Lasting Power of Attorney?

By the time you need an LPA it’s usually too late to make one. With someone in the UK diagnosed with dementia every three minutes, it’s essential that you have an LPA in place before it’s too late.

Even if deterioration isn’t a concern, life is full of unexpected events and we don’t know what’s around the corner. To ensure your future is protected, we’d always recommend an LPA.

What are the types of Lasting Power of Attorney?

There are two types of LPA; Property & Financial and Health & Welfare.

Property & Financial Affairs

This LPA allows your chosen person to handle your bank accounts and finances, for example:

  • managing bank or building society accounts
  • paying bills
  • collecting a pension or benefits if necessary
  • selling your home if needed

 Health & Welfare

This LPA covers decisions about your health and care, for example:

  • Your daily routine (washing, dressing, eating)
  • medical care
  • moving into a care home
  • Life-sustaining medical treatment

What if I lose mental capacity and don’t have an LPA?

Some people believe their next of kin can automatically make decisions on their behalf, but this could lead to complications later on.

Decisions may have to be made through the Court of Protection, or at least the CoP may appoint someone on your behalf. This will be expensive, time-consuming and possibly not the person you would choose.

For example, if you were to have an accident or develop a condition where you lack mental capacity, the following charges would apply:

When you apply:

  • £365 for the application, which would double to £730 if both Health & Welfare and Property & Financial deputies are required.
  • Potentially £485 if the court decides a hearing is required.
  • Potentially ‘Security Bond’ insurance if you require a financial deputy.

After a deputy has been appointed:

  • Annually either £320 for general supervision or £35 for minimal supervision. This is applicable every year you are a deputy.
  • £100 assessment fee if you’re a new deputy

In total, the first two years alone could cost upwards of £1,500 – a hefty fee compared to the purchase of a Lasting Power of Attorney from Damsons.

How do I choose a deputy?

One of the main benefits of an LPA is that you get to choose who looks after your affairs. You may have someone specific in mind to handle your financial and medical needs, but you can always split this to play to people’s strengths.

You may have a child that’s a nurse who you want to look after your medical needs, but don’t want to task with financial decisions too. By having an LPA it is totally up to you.

Only by having both types of LPA in place can you be assured that you are fully covered in the future. Contact us today to speak to one of our trusted advisors to discuss your needs.


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