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Nobody likes to think about the day they might develop an illness that means they are unable to make decisions, and it can be a difficult conversation to have with loved ones. But should you suffer a stroke, develop dementia or have a serious accident, it is important that your finances and care are properly taken care of, and that means setting up a Power of Attorney.
What is Power of Attorney?
Simply put, a Lasting Power of Attorney (LPA) gives another person, whether that is a relative or close friend, the power to look after your affairs should you be incapacitated, e.g. through illness such as dementia or coma.
There are two types that most people take out - the Property and Financial Affairs Lasting Power of Attorney, which hands over control of all things financial, whether that be bills, investments or property, and the Health and Welfare Power of Attorney, which enables your loved ones to make decisions about medical care and life sustaining treatment.
How can I set up an LPA?
Setting up an LPA while one is still able to make decisions means that you and your loved ones don't have to worry should you lose mental capacity. You can set one up at any time after the age of 18, which means your health and finances will be taken care of should the worst happen.
It can take up to eight weeks to register, and the LPA will only come into effect if you lose the capacity to make decisions, which will be decided by a 'certificate provider', i.e. someone you have known for two years (not a family member), or a professional such as a lawyer, doctor or social worker. The LPA itself can be set up via an online application for a fee of £110 (or £55 if you earn less than £12,000 a year, and while the Citizens Advice Bureau may be able to help with the process, it is worth considering getting help and advice from a solicitor, though that will, of course, bump up the cost.
Those who are on a low income with very little savings, and are either 70 or over, disabled, have a disabled child or are a single parent, maybe be eligible for aid via the Community Legal Service.
What if you're too late?
If a relative has already lost control of their mental faculties and no Power of Attorney is in place, it is possible to apply to the Court of Protection to appoint a Deputy (either a relative or professional) who will be granted the power to make decisions about property and finances, or personal welfare, as with an LPA.
It can be a lengthy and costly process though. A fee of £400 is required to register as a deputy, along with a £100 initial charge and ongoing supervision fees of £320 a year, depending on the needs of the relative in care. Add to this the potential for legal fees of £1,000 or more should you choose to employ a solicitor, and the cost quickly mounts up.
So while there are still options available for your loved ones should you fail to set up an LPA, it is worth taking care of when you are fit, well and able, no matter how tough a conversation it may be.
Have you set up an LPA, or struggled to take care of a relative without one? Tell us about your experience below..