A Power of Attorney (POA) could provide you with protection when you’re most vulnerable by giving someone you trust the ability to make decisions on your behalf. Yet, a survey in the Independent, found that less than half of married couples have an POA.
If it’s something you don’t have in place, here are seven reasons to make it a priority.
1. The unexpected happens
No one wants to think about losing the mental capacity to make decisions themselves. Yet, it’s something that many people experience during their life.
According to the Alzheimer’s Society, someone in the UK develops dementia every three minutes. It may not be something you can change, but you can be in control of how prepared you are.
POAs don’t have to be permanent either. If you suffered an accident or illness, you could use a POA to allow someone to temporarily manage your affairs while you focus on recovering.
2. You can name someone you trust as your POA
By naming an attorney through a POA, you can choose someone you trust to act on your behalf. It means you have control over who may make decisions for you.
Without a POA, your family could apply for a Guardianship Order to be able to act on your behalf. However, the person appointed might not be the person you would choose or may not know your wishes.
3. It ensures someone who cares about you can make health decisions
There are two types of POA. The first covers welfare decisions. It would allow your attorney to make decisions about your daily routine, medical care, and moving into a care home.
Without a welfare POA, it could be difficult for your loved ones to ensure you receive care or treatment if it’s needed.
4. It allows a trusted person to manage your financial affairs
The second type of POA covers your financial affairs and is known as a “continuing power of attorney”. If you’re unable to make decisions, it may not take long for your affairs to fall into disarray. For example, bills could go unpaid or you may not be able to collect your pension or other sources of income.
A POA giving someone you trust the power to make decisions about your financial affairs could help with this. They may also be able to make larger decisions, such as selling your home.
5. It may provide an opportunity to set out your wishes
When you name your attorney in a POA, you have an opportunity to prepare an advance statement of wishes and care preferences.
The document isn’t legally binding, but it could be useful for your attorney to refer to. You could provide information about the care home you’d prefer, views on life-sustaining treatment, or possessions you’d like to pass on to a loved one.
6. It could help protect you from fraud in the future
A report from UK Finance found in 2022 £1 billion was lost to fraud – that’s the equivalent of around £2,300 stolen every minute. While criminals use a variety of tactics, targeting vulnerable people is a common one.
Having a POA in place means someone you trust can manage your bank accounts, savings, and more. It may mean fraud is spotted sooner or even prevented.
7. A POA may form part of your wider estate plan
As part of your estate plan, you may be thinking about how you’d like to manage and pass on assets. Having a POA in place may ensure your wishes are followed even if you can’t make decisions yourself.
Get in touch to discuss the steps you could take to improve your security
Putting a POA in place could provide you with security if you lose the ability to make decisions yourself. As part of your financial plan, there might be other steps you may take to prepare for the unexpected too.
Please contact us to talk about your concerns and priorities. We’ll work with you to create an estate plan that suits your needs.
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.