One of the more important decisions when drafting a power of attorney is when the document should become effective. It can be effective immediately or it can be made to be effective only when the principal becomes disabled. The latter is known as “springing.”
Powers of attorney allow someone else to handle your affairs. A general durable power of attorney allows someone else to handle your financial affairs and a health care power of attorney allows someone else to make medical decisions on your behalf.
Both documents are considered essential in any estate plan as they are a great way to lessen (or eliminate) the need for court involvement in the case of incapacitation.
Recently, WealthManagement.com published an article about the pros and cons of making the effective date of a power of attorney immediate or springing. The article is appropriately titled “Powers of Attorney: To Spring or Not to Spring?”
The biggest issue with making a power of attorney effective immediately is that it makes it easier for someone (the “attorney-in-fact”) to abuse his or her power. All the attorney-in-fact needs is the document itself and he or she can have access to your finances and/or medical records.
However, if the power of attorney requires that you become disabled before it becomes effective, then the attorney-in-fact must prove that you are, in fact, disabled before acting.
The downside to this is that it makes it more difficult to act during an emergency.
There is no right or wrong answer when it comes to whether your powers of attorney should be immediate or springing. Without question, however, this is something you should talk over with your estate planning attorney.
Please contact our office today at 239-225-7911 to schedule an appointment with Barbara M. Pizzolato if you are interested in protecting your legacy and need to create or update your estate plan. You may also wish to attend one of our free seminars.
Reference: WealthManagement.com (January 5, 2015) “Powers of Attorney: To Spring or Not to Spring?”