Most over-55s do not have a power of attorney agreement in place.
Eight in 10 of this age group do not have the policy in place for themselves, and 69 per cent do not act as an attorney for anyone else, according to research from Lloyds Bank.
Some 29 per cent of adults think, incorrectly, that power of attorney is only put in place after a person becomes ill.
A further fifth (19 per cent) said they did not know when the right time was to put an attorney in place for themselves.
A power of attorney is a legal document where one person, the “donor”, gives another person, the “attorney”, the right to make decisions on their behalf if they are unable to do so in future, with the attorney required to always act in the donor’s best interests.
Lloyds said the risk if there is no power of attorney set up is that an individual would have to apply for a deputyship to act on behalf of another person.
This process is more expensive, with higher application fees and an annual supervision fee, and it requires the individual to be verified and supervised which elongate the process.
Yougov surveyed 2,063 UK adults between August 19 and 30 last year.
Nicola Bannister, customer financial assistance at Lloyds Bank, said the idea of arranging a power of attorney for yourself or someone else can feel daunting.
“Broaching the subject of setting up a power of attorney can be tricky but it’s worth finding the right time to discuss it with your loved ones, as it is a lot easier to discuss and arrange these things in advance of needing them, rather than at a time where things may be difficult for yourself or a family member,” she added.