Discussing how your affairs will be managed should you or a loved one be no longer able, is rarely a comfortable topic of conversation. Here is the experience of LifeCarers’ Finance Manager, Paula Rousell.
I was surprised recently when my parents told me that they were making arrangements for my brother and I to have powers of attorney over their affairs in the event that they lose mental capacity. This was not something I felt ready to contemplate, but went along with their wishes. They saw a solicitor who explained everything and helped them decide in which circumstances the POA would apply and over which decisions they wanted us to have authority.
Power of attorney is the legal process whereby an individual can grant permission for one or more people to act or make decisions about their property and financial affairs on their behalf. The only requirement is that at the time the POA is recorded they have the mental capacity to make the decision.
Mental capacity means the ability to make a specific decision at the time it needs to be made.
There are two types of Powers of Attorney (POA):
Ordinary Powers of Attorney – the individual grants permission for someone else to manage their finances on their behalf permanently or temporarily. POA may be put in place for many reasons, for example, the individual might feel less able to manage as they used to or they are going to be in hospital following an operation and requires someone to manage their finances temporarily. This type of POA can be limited to a bank account only and assets like their house can be excluded. Because the individual has mental capacity they should be able to see what their attorney is doing if they wish.
Lasting or continuing powers of attorney – must be arranged whilst the individual has mental capacity for a future time when they may not, for example through illness or injury. This can provide peace of mind because the individual knows that someone they trust will take care of their affairs when they are no longer able to do so themselves. Lasting POA can cover financial decisions relating to money and property only, but can also include decisions about affecting the health and care of an individual.
Having been through the process with my parents, who are, thankfully, still in fine fettle, I now understand more about POA and feel reassured that I know my parent’s wishes.
None of us like to think about losing our ability to make our own decisions about things like money or health care, but after discussing it and learning more on the subject, my parents and I have peace of mind that if their health declines in the future, the management of their affairs is already determined according to their wishes.
LifeCarers recommends seeking expert advice when contemplating POA. Further information and advice can be found by visiting your local Citizens’ Advice Bureau or solicitor. There are also many websites with information such as www.ageuk.org.uk, www.citizensadvice.org.uk, www.gov.uk