One in three over-65s develop dementia. Yet don't assume relatives can just walk into a bank and access your money, even to pay for your care.
Unless you've a Power of Attorney already, loved ones need to apply through court, which can be long and costly. This guide shows you how to sort it in advance.
In this guide
While every effort's been made to ensure this article's accuracy, it doesn't constitute legal advice tailored to your individual circumstances. If you act on it, you acknowledge that you do so at your own risk. We can't assume responsibility and don't accept liability for any damage or loss which may arise as a result of your reliance upon it. This guide has been written with the kind help of the Alzheimer's Society and Age UK.
What is Lasting Power of Attorney?
Thinking and talking about what would happen if our faculties deserted us is uncomfortable. Yet it's important to consider how much worse the situation would be if you had a stroke, serious accident or dementia (eg, Alzheimer's) without sorting it first.
Why set up a Lasting Power of Attorney?
If you lose mental capacity, unless you've already filled in the Power of Attorney forms, your loved ones will need to apply through court to become 'deputy', a long and expensive process.
Who is this guide for?
Regardless of health, everyone should consider a Lasting Power of Attorney. Anyone over 18 can set it up - you don't need to be unwell.
What is mental capacity?
Every day we make decisions about our lives. The ability to make these decisions is called mental capacity. People may not be able to make decisions some or all of the time, perhaps because they have a learning disability, dementia, mental health problem, brain injury or have had a stroke.
Who decides if someone has capacity?
The Mental Capacity Act 2005 says a person is unable to make a decision if they can't do one of the following: understand information relevant to a decision; retain that information long enough to make the decision; use or weigh that information; or communicate the decision. Read more on the Act's definition of capacity.
What to do next
The action to take depends on the situation. We use the word 'they' below for simplicity, but, of course, you can set up a Power of Attorney for yourself as well.
How to make a Power of Attorney
It's vital the person making the Lasting Power of Attorney understands what the forms mean. Of course, there's a trust issue here. While we don't want you to be overly cautious, sadly, in some cases, family or friends may be after someone's money. Ensure they (or you) feel comfortable with the choice and consider involving the whole family.
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If they have already lost capacity...
If someone's unable to look after their affairs but did not set up Power of Attorney in advance, carers need to apply to the Court of Protection. The court will appoint a deputy to make choices about the person's finances, usually a family member or close friend.
How to help someone manage their money
In some cases a friend or relative may still able to make decisions, but need day-to-day help with filling in forms or calling banks.
More help and info
If you're struggling with any of the issues raised here, try visiting a Citizens Advice Bureau. If someone's suffering from dementia, MoneySavers say The Alzheimer's Society's help is invaluable. You should also talk to your GP and (if applicable) social services. Other great sources of info include Age UK and Mind.