Power of attorney - don't get caught out

You may think that this doesn’t affect you as you are perfectly well, but time stands still for no one. We all have to accept that we are getting older and we need to plan for it or we can get badly caught out.

Average life expectancy has risen dramatically and none of us know what life has in store for us. It is not easy to contemplate what would happen if we were to no longer have the use of all our faculties. However, consider what the situation would be if you had an accident, a stroke or dementia. One in three people over the age of 65 will develop dementia at some point and once one has lost mental capacity it can be too late to organize Power of Attorney. Loved ones will then need to apply through the court which is often a slow and expensive business. Meanwhile there is no access to your assets to provide funding for your care.

To avoid this you can set up Lasting Power of Attorney (LPA) while you still have mental capacity, nominating a trusted friend(s) or relative(s) to look after your affairs. This does not mean that you suddenly give up control as you can choose whether it is used before, or only if and when, you lose mental capacity. Also if you became seriously ill, and you were unable to make a decision about something, your representative could start managing your affairs. Upon recovery you should be able to resume making decisions.

There are two types of LPA: one for finance and property and the other for health and welfare. There is not a lot of difference in how these work. The main difference is that the health and welfare LPA can only be used after the person loses capacity – it cannot be used before.

For more information: Call Age UK Advice: 0800 169 6565 or visit their website www.ageuk.org.uk and look on their Money Matters pages.

I advise that before taking any action you take independent legal/financial advice from a specialist in this area. For example: ‘Solicitors for the Elderly’ and ‘The Society for Later Life Advisors’ (SOLLA)