Many married couples assume that if one spouse becomes unable to make decisions, the other can automatically step in and take over. It is one of the most common misconceptions our Private Client and Court of Protection teams encounter.
In reality, marriage alone does not automatically give your spouse the authority to manage your finances, access your bank account, or make important financial decisions if you become unable to do so yourself.
At AFG Law, we regularly speak to families who are surprised to discover that they need formal legal authority before they can deal with a loved one’s affairs. This is why many couples choose to put a Lasting Power of Attorney (LPA) in place as part of their future planning.
Does Marriage Automatically Give Your Spouse Decision-Making Powers?
Banks, pension providers, investment companies, and other organisations will often require evidence of legal authority before allowing someone to act on your behalf, even if they are your husband or wife.
It is also important to note that industry guidance has long recognised that spouses do not automatically have authority to manage each other’s finances. The former British Bankers’ Association (now UK Finance) guidance made clear that banks should not assume a husband or wife has the right to operate accounts or make financial decisions for a spouse who has lost capacity.
Without a valid Lasting Power of Attorney or deputyship order, financial institutions will often be unable to accept instructions, regardless of the relationship between the parties.
It is also important to note that banks may freeze joint accounts if they discover one person has lost mental capacity.
What is a Lasting Power of Attorney?
A Lasting Power of Attorney is a legal document that allows you to appoint one or more people you trust to make decisions for you if you become unable to do so yourself. The people appointed are known as attorneys and must always act in your best interest.
There are two main types of LPA.
Property and Financial Affairs LPA
This type of LPA allows your chosen attorney to make decisions regarding your finances and property.
An LPA for property and financial affairs allows your attorney to deal with matters such as:
- Managing a bank account
- Paying bills
- Handling investments
- Buying or selling property
- Managing pensions and savings
A Property and Financial Affairs LPA can be used with your permission while you still have capacity and will continue if you later lose capacity.
Health and Welfare LPA
This type of LPA allows your attorney to make decisions relating to your care, medical treatment, and living arrangements if you are no longer able to make those decisions yourself.
What Happens If You Do Not Have an LPA?
If you lose mental capacity without a Power of Attorney in place, your spouse cannot automatically step in and manage your affairs.
Instead, they may need to apply to the Court of Protection for deputyship. This process can be time-consuming, expensive, and stressful for families at an already difficult time.
At AFG Law, we regularly assist families with deputyship applications where no Power of Attorney was created before capacity was lost. While deputyship can provide a solution, it is often far simpler to put arrangements in place in advance.
How AFG Law Can Help
Preparing for the future may not always seem straightforward, but putting a Lasting Power of Attorney in place can provide valuable peace of mind for both you and your loved ones.
Planning ahead will allow you to ensure that someone you trust is able to act on your behalf, make important financial decisions, and protect your interests if you are ever unable to do so yourself.
Our experienced Private Client team can advise on the most appropriate arrangements for your circumstances, prepare and register your Power of Attorney, and ensure your chosen attorneys have the authority to make important decisions if the need ever arises.