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You may think you don't need a Lasting Power of Attorney (LPA). But what would happen if you became so ill that you could not administer your bank account, or pay your bills? We all know that no bank is going to allow another person access to your bank account without your authority. But what if you are not in a position to give this authority? What then?
A LPA is a document where one person (the donor) gives another person (the attorney) the ability to administer the donor's property and financial affairs on his/her behalf. The attorney must only use these resources for the benefit of the donor. The document is prepared when the donor is in good health and is then stored until such time as it is needed.
Just like an insurance policy that you take out to protect you in the event of fire, an LPA can protect you from the unexpected too. Should you suffer a debilitating illness, be involved in a serious accident, develop a disease which affects your mental capacity, or even if you choose to go abroad for a period of time, your LPA can allow your finances to continue to be administered on your behalf, for your benefit, with a seamless change of personnel. This is invaluable when faced with the unexpected.
So, what would happen if you did not have such a document in place and the worst happens? Well, your friends or family would then need to apply to the Court of Protection for a deputyship order - where the Court rather than you decide who is going to look after your finances for you. This is a costly and time-consuming procedure which is best avoided (see our article on deputyship).
You should think of an LPA as a kind of insurance against financial chaos in the event of illness or mental incapacity. It won't stop it happening but it will give you the very best protection if it does.