A Power of Attorney (POA) allows you to appoint an individual or multiple people you trust to make decisions on your behalf if you’re unable to do so. It’s a crucial aspect of financial planning, as it ensures that important decisions can still be made even if you become incapacitated. At Howard Wright Financial Planning, our team of Chartered Financial Planners are committed to helping you prepare for such scenarios with confidence.
Below, we outline the key reasons to create a POA and explain the various types available.
Types of Power of Attorney in the UK
There are different types of POA in the UK, each designed for specific needs:
Lasting Power of Attorney (LPA)
This is the most widely used form of POA in the UK and comes in two key forms:
- Property and Financial Affairs LPA:
This enables your attorney to handle your financial matters, such as paying bills, managing bank accounts, and buying or selling property. - Health and Welfare LPA:
This allows your attorney to make decisions related to your health and personal welfare, including medical treatment and care arrangements. This type only becomes effective if you lose the capacity to make such decisions yourself.
Enduring Power of Attorney
EPAs were replaced by LPAs in 2007. However, if an EPA was created before that date, it can still be used. EPAs cover property and financial matters and can continue to be effective if you lose mental capacity, provided they are registered with the Office of the Public Guardian.
Why You Should Create a Power of Attorney
A Property and Financial POA ensures your financial affairs are managed in line with your wishes if you become incapacitated. This includes paying bills, managing investments, and handling property transactions.
A Health and Welfare POA allows your appointed attorney to make potentially critical decisions regarding your health and personal welfare if you are no longer able to do so. This could include making choices about medical treatment, care arrangements, and even end-of-life care such as do not resuscitate.
For business owners, a POA ensures smooth operation of the business in your absence. Your attorney can make essential business decisions, ensuring stability during times of personal crisis.
With a POA, your legal matters can be managed, ensuring your legal rights and interests are protected when you are unable to act on your own behalf.
Knowing that a trusted individual will manage your affairs offers peace of mind for you and your family, safeguarding both your personal and financial interests.
It is worth keeping in mind that a loss of capacity can happen at any time and could be temporary or permanent.
Our Thoughts
At Howard Wright Financial Planning, we work with our clients and our professional partners to ensure they set up a Lasting Power of Attorney for both property and financial affairs as well as health and welfare. The process has become more straightforward and affordable in recent years, but seeking professional advice can help ensure everything is set up correctly.
What to do Next?
To discuss your Powers of Attorney and wider financial planning needs, contact Ashley Smith one of our Chartered Financial Planners at Howard Wright, you can call him on 0345 688 4939 or you can fill in our enquiry form below, it only takes 20 seconds to complete. We look forward to hearing from you and seeing how Ashley can help you plan for the future.
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