Power
of Attorney – When the Need to Manage an Elderly Person’s Finances Arises
When an
older person no longer feels mentally or physically able to deal with their
financial affairs, Lasting Power of Attorney must be instigated before
the person concerned has lost their mental capacity to agree to setting
up Power of Attorney. No one likes to admit they can no longer make
decisions or communicate clearly what they want regarding their decisions
connected to their finances, however, it does come as a relief to have
the decision-making taken away and as long as the POA is trustworthy and
their relative/friend trusts them, it solves a lot of stress and indecision.
The person becoming the attorney, the donor (the person who is appointing
the attorney), and an independent witness have to all sign the forms, and
all be in sound mind at the time of signature.
| By
law it is presumed that every adult has a right to make his or her own
decisions and must be assumed to have the capacity to do so unless it is
proved otherwise. They must also be supported and helped before it is concluded
they cannot make their own decisions, and individuals must retain the right
to make what might seem to you to be eccentric or unwise decisions.
Of
course a voluntary decision to hand over your rights to deal with your
finances to a close relative/friend, or in some cases a solicitor, is the
best and easiest way. Trust is so very important as the agent (i.e.
the person holding the Power of Attorney) has no entitlement to the funds,
but does have access to them. |
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.
Power
of Attorney has changed in recent years, it used to be called Enduring
Power of Attorney, could be drawn up by a solicitor or even on line, the
registration authority i.e. the Public Guardianship Office has to be notified
before it becomes legal. This was reasonably easy and not too expensive
to discharge. However, the law changed in April 2007 to Lasting Power
of Attorney, which is more complicated and expensive to set up. This also
covers healthcare decisions. You can have more than one individual holding
POA and it does cease on the death of the person you represent.
It
should be kept in a very safe place and maybe copies taken as often banks,
building societies and financial institutions will need sight of it, and
may need to keep a copy on their files.
If
the decision for taking control of an individual's finances is left so
late that they are so mentally incapacitated to decide to create a Power
of Attorney, the family will have to apply to the Court of Protection to
deal with this, this involves long delays in obtaining permission to deal
with their monies, it is expensive, stressful and complicated. If
you can talk to your parent/relative when you see they are having trouble
say signing cheques, getting confused and worried about their finances,
you could start broaching the subject of you helping them and taking the
worry away. It must be very diplomatically said in such a manner as they
feel they're not losing their rights, independence, and even their mind,
which we are all frightened of doing.
 |
I
think old people, as they lose their faculties slowly and their minds and
bodies age, must feel very frightened of what is going to happen to them,
often this is obviously why they become perhaps bad tempered, a little
aggressive and depressed, so we should make allowances for them.
Of
course as in anything regarding money, it being "the root of all evil"
as they say, you will occasionally get immoral POA's who sometimes use
some of the money they have control over for their own ends, even trusted
family solicitors have been known to take advantage. Therefore this
document must not be drawn up lightly but all measures must be taken to
ensure the old person's finances are being safeguarded by the right person.
Discussions should be held within the family so that there are no ill feelings
amongst siblings, possibly not directly involved with the POA. The
person to hold POA must be willing to |
undertake
the appointment and also handle money well, be a sensible and caring individual.
If the old person owns property this also comes under the umbrella of the
POA, in fact he/she will have to keep correct accounts of spending, banking
if asked by the donor (the old person) what has happened to their money
or any local authority i.e. when the old person may have to go into a care
home, you will have to declare what savings etc., they hold so they can
determine what contribution, all, part or none the resident has to make
to his fees in the home.
A POA
can be revoked at any time, if the donor changes his/her mind, or the POA
cannot cope with his role or for any other reason, a solicitor will advise
how to go about this.
From
my experience with my own Mum, myself becoming her Power of Attorney was
a good idea as dealing with her pension, banks and bank accounts worried
her incessantly and she knew I would never abuse the situation. We
were able to discuss it whilst she understood what would happen and it
worked very well. I ensured her money was spent wisely, well protected
and invested, was able to apply for Pension credit and Attendance Allowance
on her behalf, and help with many other financial concerns and worries.
I often feel for the many elderly people who have no-one in the world to
help them when life's day to day problems become more insurmountable as
they age. Trust being the major factor in finances of course.
By
Janice L. Joplin
Nursing
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