In an article published on the MoneySavingExpert website in November 2023, Martin Lewis declared “Power of Attorney is more important than a Will”. A Will and a Power of Attorney are both very important documents. Arguably, both are equally important. However, we believe it is important to examine the basis for Martin Lewis’s claim.
A Will and Power of Attorney, what do they do?
Perhaps the best place to start is looking at the reasons for making a Will and why you should draw up a Power of Attorney.
Making a Will
When you make a Will, you set out firm directions about who should share in your estate after your death. It allows you to decide on specific bequests and legacies to individuals or charities. If you have young children, you can indicate who should be the guardian of your children. You can even decide what should be done with your remains.
A Will can also be used as a key element of estate planning. It can be used strategically to help mitigate or even eliminate Inheritance Tax.
Drawing up a Power of Attorney
You draw up a Power of Attorney to enable someone to deal with your affairs whilst you are alive but, unfortunately, can no longer look after your own affairs. It gives you the opportunity to appoint someone you trust to make decisions on your behalf when you can no longer make those decisions.
It is important to select the type of Power of Attorney that best suits your needs.
What types of Power of Attorney are there?
There are three main types of Power of Attorney. These are a General Power of Attorney, a Continuing Power of Attorney and a Welfare Power of Attorney.
General Power of Attorney
A General Power of Attorney is used by those who wish the convenience of appointing someone to make decisions and look after their affairs when they are not able to themselves. This might be where someone lives or works abroad but needs someone in Scotland who have sign off documents or deal with property, assets or contract matters in their stead. This Power of Attorney ceases to have effect should the granted lose their faculties.
Continuing Power of Attorney
This empowers your attorney to deal with your financial affairs during your life, whether you maintain your capacity to deal with these yourself or not.
Welfare Power of Attorney
This type of Power of Attorney authorises your attorney to deal with all aspects of your welfare should you lose your faculties.
Frequently, a Continuing Power of Attorney and a Welfare Power of Attorney are combined into a single Continuing and Welfare Power of Attorney.
Why might a Power of Attorney be more important than a Will?
It is all very well making a Will appointing someone to distribute your property, assets and investments after your death. Arguably, it is even more important to have someone available to deal with your property, assets and investments whilst you are alive. If you lose your faculties, surely you would want to have someone to make sure these were not squanders or unwisely applied. An attorney can always act in your best interests. They can ensure your property, assets and investments are used for your benefit and not for the benefit of others.
What happens if there is no Power of Attorney?
If you do not have a Power of Attorney and lose your faculties. A guardian may need to be appointed. Appointing a guardian can be expensive and time-consuming. This will undoubtedly eat into your property, assets and investments to the extent they can no longer be used for your benefit.
Experienced Wills and Powers of Attorney Solicitors
Here at Pomphreys, we have experienced solicitors who advise clients on Wills and Powers of Attorney. Our solicitors have many years of experience in advising clients in Wishaw, Lanarkshire and across Scotland.
If you wish to explore how a Will and Power of Attorney can be used together to aid you in the future, please get in touch with us today.
