Imagine a situation where you are no longer able to manage your own affairs.
Imagine a situation where you are no longer able to manage your own affairs. Perhaps an illness has affected your ability to make decisions, you have had an accident, or you are simply planning ahead for a time when you may need more support. Who would deal with your bank accounts? Who would pay your bills? Who would make decisions about your care or where you live?
Many people assume that a spouse, partner, child or another close relative would automatically be able to step in. Unfortunately, being someone’s relative does not automatically give you the legal authority to make decisions on their behalf.
This is where a Lasting Power of Attorney (LPA) can provide valuable protection and peace of mind.
There are two types of Lasting Power of Attorney in England and Wales: Property and Financial Affairs and Health and Welfare. Although they are both LPAs, they have very different purposes and cover different types of decisions.
Understanding the difference is an important part of putting the right plans in place. At Libra, we provide practical Lasting Power of Attorney (LPA) Help, Support & Guidance Online, helping people understand their options and approach the LPA process with confidence.
A Lasting Power of Attorney is a legal document that allows you to appoint one or more trusted people to make decisions on your behalf.
The person making the LPA is known as the donor. The people appointed to act for them are known as attorneys.
An LPA is designed to help you plan for the future. It allows you to decide in advance who you would want to help manage certain aspects of your affairs if you become unable to make particular decisions yourself.
There are two separate types of LPA:
These two types of LPA should not be confused. Having one does not automatically give your attorney authority over the other area.
A Property and Financial Affairs LPA gives your chosen attorney authority to deal with financial matters on your behalf, within the powers granted by the LPA.
This may include matters such as:
For example, if you became unable to manage your finances, your attorney could potentially deal with your bank, make necessary payments and manage your financial affairs on your behalf.
One important feature of a Property and Financial Affairs LPA is that, once registered, it can be used while you still have mental capacity if you have given your attorney authority to act. This makes it different from a Health and Welfare LPA.
A Health and Welfare LPA concerns decisions about your personal welfare and healthcare. It is intended to give your chosen attorney authority to make relevant decisions on your behalf if you are unable to make those decisions yourself.
Depending on the authority granted, this can include decisions relating to:
A Health and Welfare LPA can only be used when you lack the mental capacity to make the relevant decision yourself.
This distinction is important. Your attorney is not simply taking control of your personal life because you have made an LPA. The LPA is there to provide a framework for decision-making if you are unable to make the relevant decisions yourself.
The easiest way to understand the difference is to think about the type of decision that needs to be made.
Who could deal with my bank account and household bills?
This would fall under a Property and Financial Affairs LPA.
Who could make decisions about my care or where I live if I lack capacity?
This would fall under a Health and Welfare LPA.
Who could deal with the sale of my property?
This would generally be a matter for an attorney appointed under a Property and Financial Affairs LPA.
Who could make certain healthcare decisions if I cannot make them myself?
This could fall under a Health and Welfare LPA, subject to the terms and authority of the LPA.
The important point is that the two LPAs serve different purposes. A Property and Financial Affairs attorney does not automatically have authority to make your health and welfare decisions, and a Health and Welfare attorney does not automatically have authority to manage your finances.
There is no single answer that applies to everyone. Your circumstances, wishes and future planning needs will determine what is appropriate for you.
You may decide to make:
If you want both types, you need to make two separate LPAs because they deal with different areas of authority.
For many people, considering both can provide a more comprehensive approach to future planning.
For example, imagine someone develops an illness that means they can no longer make certain decisions independently. Their family may need to arrange for household bills to be paid and finances to be managed. At the same time, decisions may need to be made about their care and living arrangements.
These are two different areas of decision-making. A Property and Financial Affairs LPA could address the financial side, while a Health and Welfare LPA could address the relevant personal welfare and healthcare decisions.
A Property and Financial Affairs attorney can deal with financial matters within the authority provided by the LPA.
Practical examples could include:
It is important to remember that being an attorney is a position of responsibility. Attorneys must act within the authority given to them and in accordance with the legal requirements that apply to the role.
Choosing an attorney should therefore never be treated as a box-ticking exercise. You are giving someone an important responsibility, so trust, reliability and suitability all matter.
A Health and Welfare attorney can make certain decisions about your personal welfare and healthcare when you lack the mental capacity to make the relevant decision yourself.
For example, if you could no longer decide where you should live, your attorney could potentially be involved in decisions about your living and care arrangements.
Similarly, they may be involved in decisions concerning your day-to-day care or certain healthcare matters, depending on the authority provided by the LPA.
Health and Welfare decisions can be particularly personal. This is why it is worth thinking carefully about the people you appoint and discussing your wishes with them in advance.
Life-sustaining treatment is an especially important consideration when making a Health and Welfare LPA.
You can decide whether to give your Health and Welfare attorneys authority to give or refuse consent to life-sustaining treatment on your behalf, where the relevant legal requirements are met.
This is a decision that deserves careful consideration. It can also be helpful to discuss your wishes with the people you are considering appointing as attorneys so that they understand what matters to you.
One of the most important decisions you make when creating an LPA is deciding who to appoint as your attorney or attorneys.
An attorney may need to deal with important financial organisations, healthcare professionals, care providers and other people or organisations, depending on the type of LPA involved.
Before appointing someone, consider:
The person who is right for you will depend on your individual circumstances. It could be a family member, friend or another trusted person.
What matters most is that you understand the responsibility involved and choose someone you genuinely trust.
Creating an LPA involves more than simply choosing an attorney. The document needs to be completed correctly and registered before it can be used.
First, consider whether you need a Property and Financial Affairs LPA, a Health and Welfare LPA, or both.
Think about the areas where you may need support in the future and the people you would want to make decisions on your behalf.
Select people you trust and discuss the role with them. Make sure they understand what being an attorney could involve.
Each type of LPA has its own form and requirements. Take care when completing the information and make sure the details are accurate.
When making an LPA, you can consider whether you want to include preferences or instructions.
A preference can explain what you would like your attorneys to take into account. An instruction can set out something your attorneys must follow.
Care is needed when wording these sections. Unclear or unnecessarily restrictive wording can create difficulties later.
There are specific requirements concerning who needs to sign the LPA and when. These should be followed carefully to avoid problems with the document.
The LPA needs to be registered with the Office of the Public Guardian before it can be used.
It is sensible to consider registration as part of your overall planning rather than leaving the process until a situation becomes urgent.
LPAs can provide valuable protection, but mistakes in the process can cause unnecessary problems. Taking time to understand what you are doing can make a significant difference.
Being someone’s spouse, partner or child does not automatically provide authority to manage their finances or make healthcare decisions on their behalf.
This is one of the reasons why planning ahead can be so important.
Remember that the two LPAs cover different areas. A financial LPA does not simply give an attorney health and welfare authority, and a Health and Welfare LPA does not give an attorney general financial authority.
If you want someone to be able to deal with both your finances and relevant personal welfare decisions, consider whether both types of LPA are appropriate for your circumstances.
Do not choose an attorney simply because they are the closest person to you. Think about whether they are trustworthy, responsible and capable of carrying out the role.
An LPA needs to be made while you have the mental capacity required to make it. Waiting until a crisis occurs can mean that it is no longer possible to make the LPA in the intended way.
Future planning is therefore one of the most important reasons for considering an LPA before it is urgently needed.
Making an LPA is about planning ahead and choosing who can act for you in specified circumstances. It does not simply mean handing over control of your affairs as soon as the document is created.
Understanding when each type of LPA can be used is an important part of making an informed decision.
David becomes unable to manage his financial affairs and needs someone to deal with his bank accounts, regular payments and household bills.
Relevant LPA: Property and Financial Affairs.
Margaret loses the capacity to make a particular decision about her living arrangements and needs support with decisions about her care.
Relevant LPA: Health and Welfare.
John is no longer able to manage his property and financial affairs and his attorney needs to deal with matters concerning his home.
Relevant LPA: Property and Financial Affairs.
Susan lacks the mental capacity to make a particular healthcare decision and someone she has appointed needs to be involved in the decision-making process.
Relevant LPA: Health and Welfare, subject to the terms and authority of the LPA.
Peter becomes unable to make certain decisions and needs someone to manage his financial affairs while also requiring support with personal welfare and healthcare decisions.
Relevant LPAs: Potentially both Property and Financial Affairs and Health and Welfare.
Before completing your LPA, it can be useful to work through a simple checklist:
The two types are Property and Financial Affairs and Health and Welfare. Property and Financial Affairs covers financial matters such as money, property and bills. Health and Welfare covers relevant decisions about personal welfare, care and healthcare when the donor lacks the mental capacity to make the relevant decision.
Not necessarily. It depends on your circumstances and what you want to plan for. Some people choose one type, while others decide that having both provides more comprehensive protection for their future.
Not simply because they are your Health and Welfare attorney. Financial matters are generally dealt with under a Property and Financial Affairs LPA.
Not simply because they are your Property and Financial Affairs attorney. Relevant health and welfare decisions fall under a Health and Welfare LPA.
A Health and Welfare LPA can only be used when the donor lacks the mental capacity to make the relevant decision themselves.
Yes. Once registered, a Property and Financial Affairs LPA can potentially be used while the donor still has mental capacity if the donor has given the attorney permission to act.
Yes. If you want to appoint attorneys to deal with both financial matters and relevant health and welfare decisions, you can make both types. They are separate LPAs.
An LPA is a planning document. It needs to be made while you have the required mental capacity. Waiting until you are no longer able to make the necessary decisions can mean that an LPA cannot be created in the way you intended.
Understanding the difference between the two types of LPA is an important first step, but completing the process correctly can feel daunting, particularly if you have never dealt with an LPA before.
This is where clear, practical guidance can make the process easier.
At Libra, our aim is to make Lasting Power of Attorney planning easier to understand. Whether you are considering an LPA for the first time, already working through the process or looking for approachable guidance, understanding your options can help you make decisions with greater confidence.
Good LPA planning is ultimately about preparation. It is about thinking ahead, choosing people you trust and making your wishes clear before circumstances make those decisions more difficult.
The two types of Lasting Power of Attorney serve different but equally important purposes. A Property and Financial Affairs LPA can help ensure that someone you trust is able to deal with your financial affairs when appropriate, while a Health and Welfare LPA can provide a framework for relevant personal welfare and healthcare decisions if you lose the capacity to make them yourself.
For many people, considering both types is an important part of planning for the future.
You do not have to wait for a crisis before thinking about an LPA. Taking time to understand your choices now can help you put the right arrangements in place while you are able to make those decisions for yourself.
If you are looking for Lasting Power of Attorney (LPA) Help, Support & Guidance Online, Libra is here to help you understand the process and take the next step with confidence.
Get in touch with Libra today to find out how we can support you with your LPA journey.
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