SECTION D - SPECIALIST ADVICE
CHAPTER 16 - FINANCIAL ADVICE
It is important to appreciate that there are different types of advice; unregulated and regulated.
a) Unregulated advice; anyone can provide information and advice on choosing and paying for care which is not regulated by
the Financial Conduct Authority.
b) Regulated Advice; is provided by financial advisers who are qualified and regulated by the Financial Conduct Authority who
have their own definitions for advice and guidance.
Unregulated Financial Advice
Remember if you are providing information and advice on choosing and paying for adult care whatever the role or capacity this CANNOT include regulated financial advice unless you are financial adviser approved and regulated by the Financial Conduct Authority (FCA).
Many financial advisers have worked in this area for years and have extensive experience and knowledge on choosing and paying for care and may be able to include ‘unregulated’ advice as a complete approach to their advice provision. These advisers may be referred to as ‘care fees specialists’.
Some financial advisers may not be experienced in long term care advice but provide regulated financial advice and will rely on others to help provide a complete approach. This is good practice, in the same way as unregulated advisers should acknowledge the value and role of a specialist financial adviser.
Regulated Financial Advice
An independent financial adviser can enable people to make well informed choices about how to pay for their care and plan for the present and future.
Depending on their qualifications and permissions they can advise on, recommend, and arrange financial products and services, which may include;
Care fees planning
Savings and investment planning
Tax matters and estate/wealth planning
The Care Act requires Local Authorities to actively help and direct a person to a choice of advisers, who are independent of the Local Authority, and regulated by the Financial Conduct Authority with the appropriate qualifications and accreditation.
The Society of Later Life Advisers was founded in 2008 as a not for profit organisation dedicated to raising the standards and helping people to find Independent Financial Advisers who are not only qualified but dedicated to later life advice and become independently accredited to offer reassurance.
SOLLA - Society of Later Life Advisers
Tel; 0333 2020 454
Immediate care plans may also be known as immediate needs annuity or care fees annuity and are offered by specialist insurers who provide a specific monthly tax free amount for as long as care is needed in return for a lump sum up front payment. The price of a care plan is based on how much income you need and the insurance company’s assessment of how long you’re likely to need it for.
Selling your existing home and buying a smaller, less expensive one instead could free up some money to pay for your care costs but remember it may be disregarded if someone else is living in it for benefits and Local Authority assessment or a deferred payment agreement may be an option, please seek regulated financial advice.
Equity Release is a way of raising money against the value of your home. It is vital to seek financial advice to make sure you consider the possibilities and implications.
Renting out your home if you’re not living there to pay for your care?
Bear in mind this may have taxation implications.as the income may be considered for means tested benefits and Local Authority financial assessment.
From April 2015 people have more choice on how to use a pension pot after the age of 55. Pension Wise are delivering free, impartial guidance. Please seek financial advice from a regulated, SOLLA accredited, financial adviser.
CHAPTER 17 - LEGAL ADVICE
Enduring Power of Attorney
An Enduring Power of Attorney is a legal process in which a person (the Donor) hands over to someone else (the Attorney)
the power to make decisions about their financial affairs and property. An Enduring Power of Attorney signed by both the
Donor and Attorney before Oct 2007 can still be used and registered as a legal document. An Attorney can use the power
straight away if that is the Donors wish or the Donor can make it clear that the EPA is only to be used if they become unable
to manage their affairs in the future.
Lasting Power of Attorney
A Lasting Power of Attorney (LPA) enables a person who has capacity and is over 18 (Donor) to choose another person or people (Attorney(s)) to make decisions on their behalf.
There are 2 different types of Lasting Power of Attorney;
Property and financial affairs and/or Health and welfare.
A LPA must be registered with the Office of the Public Guardian (OPG) before it can be used. An unregistered LPA will not give the Attorney any legal powers to decide for the Donor and of course while you have capacity to make your own decision you every right to even if they are considered wrong in someone else’s opinion.
A fee is charged for registration of each Lasting Power of Attorney application, registered with, and administered by The Office of the Public Guardian.
Court of Protection - Deputy
When no Enduring or Lasting Power of Attorney exists and someone lacks the capacity to make their own decision the Court of Protection can appoint Deputies to make decisions in the best interests of those who lack capacity - 0300 456 4600
This can take several months to process and is more expensive than assigning someone as a Lasting power of attorney before mental capacity is lost.
This is more expensive and time consuming, often at a time of crisis this is just one hurdle too many.
Please also consider specialist advice for;
Wills/probate, estate and tax planning which may require advice from legal and financial experts
Solicitors for the Elderly (SFE) is an independent, national organisation of lawyers who provide specialist legal advice for older and vulnerable people, their families, and carers.
The Local Authority has a duty to meet an assessed need. If mental capacity is lost and no one has a legal capacity to act then they will meet a care need until the Court of Protection has assigned a Deputy and if appropriate recover expenses.
Department of Works and Pensions – Appointee
A DWP Appointee allows someone who is over 18 years old to manage another person’s benefits (ONLY BENEFITS) if they physically or mentally unable to do this themselves.
The ability to understand and make a decision when it needs to be made is called ‘mental capacity’.
The Mental Capacity Act 2005 (MCA) is a law that protects and supports those who can’t make some or all decisions for
themselves. The act applies to people aged 16 and over in England and Wales.
Time and decision specific
Whenever the term ‘a person who lacks capacity’ is used, it means a person who lacks capacity to decide or act for themselves at the time the decision or action needs to be taken because of the way their mind or brain is affected. You cannot decide that someone lacks capacity based upon age, appearance, condition, or behaviour alone.
The MCA says that a person is unable to decide if they cannot do one or more of the following four things:
Understand information given to them
Retain that information long enough to be able to make the decision
Weigh up the information available to make the decision
Communicate their decision.
The MCA Code of Practice provides guidance to anyone who is working with and/ or caring for adults who may lack capacity to make decisions. It describes their responsibilities when acting or making decisions on behalf of individuals who lack the capacity to act or make these decisions for themselves.
Mental Capacity Act 2005 Principles
Principle 1 - A presumption of capacity
Every adult has the right to make his or her own decisions and must be assumed to have capacity to do so unless it is proved otherwise
Principle 2 - Individuals being supported to make their own decisions
A person must be given all practicable help before anyone treats them as not being able to make their own decisions
Principle 3 - Unwise decisions
People have the right to make what others might regard as an unwise decision
Principle 4 - Best interests
If a person has been assessed as lacking capacity then any action taken, or decision made for, or on behalf of that person, must be made in his or her best interest
Principle 5 - Less restrictive option
Someone deciding or acting on behalf of a person who lacks capacity must consider whether it is possible to decide or act in a way that would interfere less with the person’s rights and freedoms of action, or whether there is a need to decide or act at all.
Assisting Decision Making
Return to the first principle of the MCA, assume that the person has capacity to make the decision in question. Consider whether they have received and understood all the relevant information needed to make the decision. Have their communication needs been considered? Are they able to consider the options, the risks, and benefits, including the consequences of deciding, and making no decision?