Have you ever considered how you’d manage your finances if you were temporarily unable to do so yourself? Maybe you’re planning an extended trip abroad, facing a hospital stay, or finding it challenging to get out and about. In these situations, an Ordinary Power of Attorney (OPA) could be the solution you need. Let’s explore what an OPA is, how it works, and whether it might be right for you.
Understanding Ordinary Power of Attorney
An Ordinary Power of Attorney, also known as a General Power of Attorney, is a legal document that empowers you (the donor) to appoint someone you trust (the attorney) to make financial decisions on your behalf. This flexible tool helps you manage your affairs when you’re temporarily unable to do so, but still have mental capacity.
An OPA can be incredibly useful in various situations. For instance, if you’re planning a long holiday abroad and need someone to handle your bills while you’re away, an OPA could be the perfect solution. Similarly, it can ensure your financial affairs run smoothly if you’re facing a hospital stay or recovery period, or if mobility issues make it difficult for you to leave home.
When Might You Need an OPA?
Several scenarios might make an OPA beneficial:
1. Extended travel: An OPA ensures your finances are managed during long trips overseas.
2. Medical procedures: When recovering from a hospital stay, an OPA allows you to focus on healing without worrying about financial matters.
3. Mobility issues: If getting out and about is challenging, an OPA enables someone to handle financial tasks for you.
4. Temporary delegation: For any other reason where you need someone to manage your finances for a limited time.
Remember, an OPA is designed for temporary situations where you still have mental capacity. If you’re concerned about potentially losing mental capacity in the future, consider a Lasting Power of Attorney (LPA) instead.
OPA vs LPA: Understanding the Differences
While both OPAs and LPAs allow someone to make decisions on your behalf, they differ in crucial ways:
1. Mental capacity: An OPA remains valid only while you have mental capacity, becoming invalid once you lose it. In contrast, an LPA continues even if you lose mental capacity.
2. Registration: You can create and use an OPA immediately without registration. However, you must register an LPA with the Office of the Public Guardian before use.
3. Scope: OPAs typically cover only financial decisions, while LPAs can encompass both financial decisions and health and care matters.
Creating an Ordinary Power of Attorney
To create a legally valid OPA, you need to include specific wording in the document:
1. A clear statement of your intention to create a power of attorney
2. Your full name and address
3. The full name and address of your chosen attorney(s)
4. The specific powers you’re granting (e.g., managing bank accounts, paying bills)
5. Any limitations on these powers
6. The OPA’s start and end dates
Someone who isn’t the attorney or their spouse must witness your signature on the document. While you can create an OPA yourself, seeking legal advice ensures the document meets your specific needs and provides peace of mind.
Need assistance creating an Ordinary Power of Attorney? Our team at A.D.E Wills can guide you through the process. Reach out to us today on 01865 507174 or email info@adewills.co.uk to get started.
Responsibilities and Limitations of the Attorney
Appointing an attorney under an OPA comes with significant responsibilities. Your attorney must always act in your best interests and within the scope of the powers you’ve granted. It’s crucial to understand the limitations of what your attorney can do. They cannot:
1. Make decisions about your health and care
2. Make gifts from your money (unless specifically authorised)
3. Mix your finances with their own
These restrictions protect your interests and ensure appropriate use of the power of attorney.
Ending an Ordinary Power of Attorney
One advantage of an OPA is its flexibility. You can terminate an OPA at any time by creating a deed of revocation, which states that you’re revoking the power of attorney. Make sure to inform your attorney and any relevant banks or institutions about this change.
An OPA automatically ends if you lose mental capacity. At this point, an LPA would take over if you have one in place.
Legal Implications and Safeguards
While an OPA is a useful tool, choosing your attorney carefully is crucial, as they will have significant control over your finances. Consider implementing these safeguards:
1. Limit the powers granted in the OPA
2. Appoint multiple attorneys to act jointly
3. Review the arrangement regularly
These measures help protect your interests and ensure the OPA continues to serve its intended purpose.
Frequently Asked Questions
Q: Can I appoint more than one attorney?
A: Yes, you can select multiple attorneys to act jointly or jointly and severally. This provides an additional layer of security and ensures collaborative decision-making.
Q: Will I still be able to make decisions for myself with an OPA in place?
A: Absolutely. An OPA doesn’t remove your decision-making rights. You retain full control over your affairs and can continue making decisions as long as you have mental capacity.
Q: What determines the duration of an OPA?
A: An OPA remains in effect until you revoke it, lose mental capacity, or pass away. This flexibility allows you to use the OPA for as long as necessary.
Final Thoughts
An Ordinary Power of Attorney offers a valuable tool that provides flexibility and security, ensuring management of your affairs according to your wishes when you can’t handle them yourself. It’s designed to make your life easier during times of need.
Considering setting up an OPA? Connect with our friendly team of professionals at A.D.E Wills. We’re here to guide you through the process and safeguard your interests. Call us today on 01865 507174 or email info@adewills.co.uk to discuss your needs.
Disclaimer: This article provides general information about Ordinary Power of Attorney. It does not constitute legal advice. For guidance tailored to your individual circumstances, please consult a qualified legal professional.
