People always have a lot of questions regarding powers of attorneys (POA). It makes a lot of sense. Powers of attorneys are so important because they give access to decisions when otherwise your loved ones may be stuck without access! One of the big questions we always get is the different types of powers of attorney. Specifically, durable powers of attorney and springing powers of attorney. Today we’re picking on springing powers of attorneys and why you may or may not want a power of attorney that’s springing.
To start with we’re talking about a financial POA. This is just a POA that gives someone you choose the power to make financial decisions for you. That power can be springing or non-springing. If the power is non-springing, then the person you choose has the powers you grant them immediately upon the power of attorney document being signed. This means that even if you are capable of signing for yourself the person you choose could sign for you immediately.
If the POA is springing, the person you choose to make financial decisions for you will act only if you become disabled or incapacitated. A medical doctor would need to certify in writing your mental and/or physical condition is impaired to the extent that you can no longer personally make financial decisions for yourself. Only after a doctor certifies you are no longer capable can the person you choose begin using the powers given in your financial POA.
Some people just aren’t comfortable with the idea of someone else signing for them when they are still capable and may prefer a springing POA. However, if the power is springing, and then there is a need for your chosen agent to act, there could be a delay while they try to get a doctor to certify that you are no longer capable. A non-springing power of attorney may be preferred by some people for convenience. If your traveling or just otherwise busy, your agent could sign for you if they are given the power to act immediately.
Many married people will choose their spouse to act for them and are comfortable with their spouse signing for them immediately. The thing to keep in mind if you choose a non-springing power of attorney is that if you choose a successor agent, someone to act for you if your first choice is unable or unwilling, and your spouse becomes unable or unwilling to act, then your successor agent will then have the power to act immediately as well. Therefore, if you execute a non-springing POA, you need to be comfortable with all successor agents acting immediately and not just the first named agent. However, there is some protection in the fact that that a successor agent would have to prove that the prior named agent was unable to act before they could act on your behalf. Regardless of whether you choose to execute a springing or a non-springing power of attorney, you should select an agent that you trust will act in your best interest.
Having a springing or non-springing power of attorney is a big choice and one we spend a lot of time discussing with our clients. So if you’re wondering which is best for you and your loved ones, the best idea is to contact an attorney and figure out your estate plan.