14/12/20Lasting Power of Attorney: Why is it something we put off?
Naming a Lasting Power of Attorney is something that we should all do. It’s something that can provide us with security if we’re unable to make decisions. While it’s often something that’s associated with being elderly, it’s just as important for younger generations to take this step too.
A Power of Attorney gives someone you trust the power to make decisions on your behalf if you’re unable to. When you think about situations in which you would need this, most people think of losing mental capacity through dementia. But Kate Garraway’s story has recently highlighted why it’s important to have a Power of Attorney in place even when you’re healthy.
Kate Garraway’s experience highlights the importance of a Power of Attorney
ITV presenter Kate Garraway has featured in the news throughout the Covid-19 pandemic after her husband took ill. Her husband Derek has been hospitalised with Covid-19 since March and has been in a coma for much of the time. In his early 50s, Derek isn’t someone you’d usually associate with losing mental capacity. However, Kate has spoken out about the challenges.
In an interview with ITV, she said: “One of the practical problems – which a lot of people would have experienced if they’ve got the absence of someone in their life – like many things, the car is entirely in Derek’s name, the insurance is in Derek’s name, a lot of our bank accounts. There are lots of financial goings-on which are making life very complicated because I can’t get access to things because legally, I haven’t got Power of Attorney.”
The lack of a Power of Attorney means that loved ones can be left dealing with a financial mess and inability to manage it while you’re unable to make decisions. It can lead to complications and affect your financial security in the future.
Power of Attorney doesn’t just cover financial issues either but may cover the decisions about your health and care. If you’re ill, for example, a Power of Attorney will be able to make decisions about the type of care you have, including life-sustaining treatment. Without a Power of Attorney, you may be left in a vulnerable position.
3 reasons you might be putting off naming a Power of Attorney
1. “I’m too young to need one”
Needing a Power of Attorney is often associated with losing mental capacity due to age. However, accidents and illness can happen at any time. It’s a step that can protect you should the unexpected happen.
A Power of Attorney isn’t always permanent, it can be temporary until you’re able to make decisions again. It’s also important to note that you may want a Power of Attorney to make decisions on your behalf even if you have mental capacity. Handing financial decisions over to someone you trust while recovering from an illness can mean you’re able to focus on what’s most important.
2. “It will never happen to me”
This is a common reason for not naming a Power of Attorney. It can seem like a hassle for something that you will never need to use.
While it’s true that most people that name a Power of Attorney, thankfully, don’t need to use them, it acts as protection just in case. The chance of your home getting damaged in a fire is very small, but you still take out building insurance to give yourself peace of mind. View naming a Power of Attorney in a similar way; you hope it won’t need to be used, but it’s there in case you do.
3. “My partner will be able to make decisions on my behalf”
If you’re married or in a civil partnership you may mistakenly believe your partner will be able to make decisions on your behalf. However, no one has the automatic right to make decisions for you.
Not having a Power of Attorney can not only leave you in a vulnerable position but your loved ones too. Even if you hold a joint bank account, one party losing mental capacity can mean the account is frozen as it cannot be operated independently of each other.
Naming a Power of Attorney is simple and can protect you
Despite thousands of people putting off naming a Power of Attorney, it’s a simple step to take.
You can fill in the forms online here or download paper forms to post here. You can ask a solicitor to help you if you wish, but the forms are relatively straightforward, and you don’t need to use a legal professional. Once the forms are completed, you need to register a Power of Attorney with the Office of the Public Guardian for it to be valid. This is a process that takes between eight and ten weeks and costs £82 per Power of Attorney.
There are two types of Power of Attorney. The first covers financial and property affairs and the second covers health and care. You should make sure you have both in place.
If you have questions about Power of Attorney and how it fits into your wider plans, please get in touch.
Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.
The Financial Conduct Authority does not regulate estate planning.