One in three of all people over the age of 65 will develop dementia, according to Ruth Sutherland of the Alzheimer's Society. She, along with other campaigners for dementia awareness week, is urging people to take legal protections to put their affairs in order now before infirmity or illness strikes.

There are more than 700, 000 people living with dementia in the UK and that number is expected to hit 1 million by 2015. "As we live longer, the number of people with dementia will rise almost exponentially," said Sutherland, acting chief executive of the Alzheimer's Society. "No one wants to consider a future with dementia but planning what would happen to you if you were to lose capacity is incredibly important."

Peter Ashley, a 74-year-old from near Warrington, Cheshire, would like to see people tackle the issue as a matter of course when they draft their will.

"It should be a fact of life, at some point, that you look to your ultimate demise and think: 'I'm going to have to relieve my worldly assets, prior to that I might lose my competence and therefore need someone to help'. Unfortunately, so many of us don't even bother with wills." Ten years ago Peter was diagnosed as having dementia with Lewy bodies. As he explains, there are "lots of myths about dementia and people think of Alzheimer's, which is more aggressive than most". His condition "tends to affect the motor function rather than intellectual competence. "I have tremors similar to Parkinson's disease and problems walking. At the time of diagnosis, I was a talented musician but now I can't play the piano."

Although he is still "as intellectually bright as ever", he had an enduring power of attorney drafted in 2002 which he describes as "covering all the issues to do with money, property and healthcare that you need to keep going while you are living. It's not a question of just self-interest. I want to plan for family – my wife, three daughters and two granddaughters".

The Mental Capacity Act 2005 came into force in October 2007 offering safeguards for those who may not be able to make decisions on their own.

"While it is not perfect, it safeguards our futures," said Sunderland. She admits that the protections afforded by lasting powers of attorneys (LPAs) – which replaced enduring powers of attorney in 2007 – were "expensive, cumbersome and need improvement".

However, she added that LPAs, together with living wills, give people the right to make decisions about their future. "Without these, families face financially and emotionally exhausting battles just to care for those they love."

For Peter the most important thing is that "you don't let the legalities destroy the individuality of the person prematurely. You have to recognise the right of someone to retain their personhood right up to the point where they can no longer exercise their wishes".

Peter nominated his wife as carer and, if she is not available, his three daughters. He has also nominated a doctor, and written into the power of attorney a statement to the effect that the doctor has to agree with the carer (or carers) on the vital issue of his intellectual competence.

Peter also has an advanced directive which, as well as stipulating the kind of medical care covers a range of quality of life issues (I don't like baths, I like showers … I don't want to watch TV all day ...) "It deals with the more obvious things in life that I hope might make me happy when I lose some of my intellectual competence."

Caroline Bielanska, chair of Solicitors for the Elderly, points out: "Many people think: 'what's the point in planning ahead for an event that might never happen?' It's not a condition anyone would aspire towards, but it's something that many of us need to be aware of. Our problem, as professionals, is people are immediately worried about costs."

If there is no LPA, then the Court of Protection can appoint "a deputy" to make decisions on your behalf but that is hugely expensive, time-consuming and uncertain. The court application fee is £400, you need a medical report (about £500), and an insurance bond to cover the possibility of mismanagement of funds. It is payable every year and could be thousands of pounds, plus a one-off supervision fee of up to £800.

"By contrast, drafting a power of attorney when you are fit and able can cost as little as £200," Bielanska says. You can download LPA forms, at no cost, from the Office of the Public Guardian website.

Anthony Fairweather, a partner at Bristol solicitors Clarke Wilmott, advises elderly clients on the need for "end of life planning". "People have very strong views on how they want to end their days," he says. "This encompasses a wide range of issues, not just control of property and finances. Often people want to be in their home for as long as they can when health deteriorates, they don't want to be in a hospital and if they have to be somewhere, that might be a particular hospice. They might also have very strong views as to which treatments they find reasonable."

Thinking about the end of your life "need not be necessarily a reactive process," Fairweather says. "People want to take control of their own destiny and don't want to place a burden on others."

There are two forms of LPAs, which are separate documents. Firstly, "property and affairs" enabling someone you trust to make decisions on your behalf such as paying your bills, collecting your income or selling your house. "It's emotionally difficult, because people never like to think they need help managing their finances," comments Phillipa Bruce-Kerr, of Cheltenham-based solicitors Rickerbys. "It really brings home the reality of the diagnosis."

Then there is the "personal welfare" LPA which allows the person you have chosen to make decisions on your behalf relating to, for example, consent to medical treatment or life-sustaining treatment. As an alternative, you could opt for an advanced directive, or living will, to express your wishes in advance.

Anthony Fairweather explains that the latter is sometimes appropriate if someone has a concern about a hereditary condition such as dementia. "It can be a great relief to some families not to be involved in difficult decisions about medical treatments," he adds.

Peter's wife also has an enduring power of attorney. As he says: "There's nothing wrong with her.

"Her view is that the intelligent thing to do is think about the future ... whether you have a diagnosis or not."

Preparing for the worstWills

• Make sure you have one that's up to date.

• Consider ways of reducing inheritance tax liability – for example, by lifetime gifts.

Lasting power of attorney (LPA)

• A property LPA allows a trusted person to make decisions on your finances if you lose the ability to do so for yourself. Otherwise, the Court of Protection may intervene – a costly process .

• A welfare LPA enables a trusted person to make decisions about your healthcare. Or consider an advanced medical decision – a statement setting out the treatment you expect in particular circumstances.

Finance and care planning

• Take advice on your eligibility for social or NHS care funding. If you're not eligible, ask a financial planner whether you have enough money to fund care.

• Take advice on benefits such as disability living allowance, attendance allowance and carers allowance. 

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