What is a Lasting Power of Attorney for property and financial affairs?

Full answer

A Lasting Power of Attorney for property and financial affairs is one of two types of LPA available in England and Wales (the other covering health and welfare decisions), and is an important piece of financial planning that many people put off until it is too late to arrange. **What it covers** An attorney appointed under a property and financial affairs LPA can, depending on the specific powers granted, manage bank and savings accounts, pay bills and manage income, buy or sell property on your behalf, manage investments, and deal with tax affairs -- essentially standing in your financial shoes when you are unable (or choose not) to manage these matters yourself. **Using it before losing capacity** Unlike the health and welfare LPA (which can only be used once you lack mental capacity), a property and financial affairs LPA can, if you choose, be used with your consent even while you still have full mental capacity -- useful for people who want help managing their finances due to physical illness, being abroad, or simply wanting support, not just as a safeguard for future incapacity. **Registration requirement** An LPA must be formally registered with the Office of the Public Guardian before it can be used -- this involves a registration fee and can take several weeks to process, so it is generally advisable to register the LPA soon after it is signed, rather than waiting until it is urgently needed, since registration delays could leave a period where financial decisions cannot be made on your behalf if capacity is suddenly lost. **Choosing your attorney(s)** You can appoint more than one attorney, and specify whether they must act jointly (agreeing on every decision together) or jointly and severally (able to act independently of each other) -- joint appointments provide more oversight but can create practical delays if attorneys disagree or are not easily able to coordinate; jointly and severally gives more flexibility but less built-in checking of individual decisions. **What happens without an LPA and capacity is lost** If someone loses mental capacity without having an LPA in place, their family cannot automatically step in to manage their finances -- instead, an application must be made to the Court of Protection for a deputyship order, which is considerably more expensive, time-consuming (often taking many months), and involves ongoing court supervision, compared with using a pre-arranged LPA. **Safeguards against misuse** The LPA registration process includes a role for a "certificate provider" (an independent person who confirms the donor understands what they are signing and is not being pressured), and donors can also name people to be notified when the LPA is registered, giving an additional layer of oversight against potential misuse by an attorney. **Cost and complexity** LPAs can be set up using the government's own online or paper forms without a solicitor, though many people choose to use a solicitor for more complex family situations, or where they want tailored restrictions or guidance included within the document -- solicitor involvement adds cost but can reduce the risk of errors that delay or complicate registration. **Practical tip** Do not wait until a health crisis to set up a property and financial affairs LPA -- it can only be created while you still have mental capacity to understand and consent to it, so once capacity is lost, it is too late, and family members are left with the more difficult and costly Court of Protection deputyship route instead.