Your money, your future welfare: who’ll manage it when you can’t?
We are all living longer – and mostly that is a good thing. Over the last 28 years, the number of people living for over 100 years in the UK has more than quadrupled and there is no sign that this phenomenon is slowing down. The downside of such longevity is that it is mirrored in a rise in illnesses affecting mental capacity, such as dementia and Alzheimer’s. Current figures suggest that there are more than two million people in England and Wales who lack the capacity to make decisions for themselves. Not surprising, when you consider that by the age of 85, nearly half of all people will be affected by the disease.
This gives rise to all sorts of questions: who would you want to manage your future welfare on your behalf? Are you happy for family members to manage your money? What about selling your house? Or even just setting your weekly budget? There are other decisions which may need to be made for you, such as what level of care you require, what sort of medical treatment you would want and, at the end of your life, how you might want that end to come.
These are all difficult topics. The author Terry Pratchett’s diagnosis and subsequent campaigning have raised public awareness of the devastating effect Alzheimer’s can have on individuals and those who care for them. However, Pratchett’s recent TV programme, Choosing to Die, (broadcast on BBC2 in June), which explored assisted suicide for the terminally ill also caused controversy, highlighting the public’s sensitivity regarding this ongoing debate.
If you have strong views about who you would like to manage your finances and your personal future welfare in the event you should become incapable, you should consider making a Lasting Power of Attorney (LPA). An LPA appoints someone to make decisions on your behalf and allows you to plan in advance:
- Decisions that you want to be made on your behalf if you lose the capacity to make them yourself;
- Who you want to make these decisions;
- How you want them to make these decisions;
- Having an LPA is the safest way of maintaining control over decisions because:
- It has to be registered with the Office of the Public Guardian before it can be used;
- You choose someone to provide a ‘certificate’, which means they confirm that you understand the significance and purpose of what you’re agreeing to;
- You can choose who gets told about your Lasting Power of Attorney when it is registered (so they have an opportunity to raise concerns);
- Your signature and the signatures of your chosen attorneys must be witnessed;
- Your attorney must follow the Code of Practice of the Mental Capacity Act 2005 and act in your best interests.
There are two types of LPA that you can put in place to safeguard your future: a Property and Financial Affairs LPA appoints someone on your behalf to make property and finance-related decisions, such as paying bills or selling the home; a Health and Welfare LPA appoints someone on your behalf to make decisions on matters such as medical treatment or moving into a care home – as opposed to letting social services, carers or medical professionals make those decisions. The choice of a care home is a common concern and most people discuss their wishes with their family first.
The average cost of an LPA is between £250-£400 plus VAT and it is unlikely that you would need to make more than one in your lifetime. If you do not have an LPA and you lose mental capacity then anyone can apply to the Court of Protection to be a Deputy to deal with your affairs for you. This means you won’t necessarily get the person you would choose and you will not have the opportunity to say what you want.
Deputyship applications are also much more expensive, with average costs including court fees (which may come out of your funds) exceeding £1,500 – and sometimes much more.
If you want to choose who looks after your future welfare and how, then you really should put a Lasting Power of Attorney in place. It may turn out to be the most important decision you ever make.
Posted on Jul 29th, 2011 by Lyons Davidson