Managing financial affairs can be a complex process depending on the individual and their situation.
Using money is an everyday activity and most people have the ability to do this with minimal support but find making the right choices about money difficult.
For example you may be able to manage to withdraw money or pay your bills, go to the shops and make purchases, but not have the ability to manage large and complex amounts of money like a lump sum from a pension or an inheritance.
For people who are making choices to invest or release money, a mental capacity assessment can help to support that decision, to ensure your financial safety and reduce the risk of contention.
Sometimes buying or selling a house can be a challenging process, especially for someone who may be having to do this on their own. They need to have an understanding of their general finances and the value of money so that they are aware of whether they can afford it and budget accordingly.
Why Assess?
Given the role that finances play in people’s lives, it is important to make decisions about handling or investing money. This is a decision that is very specific and sometimes a financial choice may seem unwise. Having an MCA to support your choices or prove you have the ability to do this protects your rights.
Making a gift and understanding the implications of it varies.
If the gift is small, the degree of understanding required is low. If the gift is your only asset, for example your house, then the significance is the same as making a Will.
You must be aware that
-
you are making a gift
- what the gift comprises of
- who will receive it
You must also be aware of
- how much of the proportion of the gift is in relation to your whole wealth
- roughly what your whole wealth is
Why Assess?
This is to ensure you know what the impact is on your ability to manage financially after gifting and also the effect on other people, for example those named in your will.
Sometimes a trusted Financial Advisor can help you make sound decisions.