The form may include:
Whom you appoint as an agent for your affairsAn alternate agent if the first is not availableA date, condition, or event that triggers the springing power of attorneyRequirements for proving the event or condition—such as doctors or psychologistsConditions or restrictions on the agentRevocations of any previous powers of attorneyWitnesses’ signatures
The event that triggers a springing power of attorney is usually related to a condition that inhibits your ability to make sound decisions. Those conditions could include:
DementiaBrain injuryAlcohol or drug useMental health issuesComa
As a result of your condition, you may have trouble communicating, understanding, and remembering information necessary to carry out financial, health, and other transactions. “Most people who want a springing power of attorney use it as a little extra control,” Michigan-based estate planning attorney Julie A. Paquette told The Balance in a phone interview. “It gives you extra protection, and prevents someone from accessing your accounts when you still have the capacity.” Paquette said that springing power of attorney is not commonly used. That’s because a springing power of attorney’s requirements places severe limitations on a power of attorney, which can hamper your agent’s ability to respond to challenging situations. “Sometimes, when there are pressing needs, your agent must act fast,” Paquette said, and circumstances out of your control can complicate the situation and process further. For example, during the COVID-19 pandemic, finding two separate physicians to meet with and certify mental incapacity may have been almost impossible, Paquette noted. In the meantime, some financial issues may not wait for certification—such as a house closing. “If you have a closing the next day to sell your house, you need an agent to stand in your place at closing to make sure it happens,” Paquette said. “You can’t wait and find physicians. It adds difficulty, where the power of attorney helps the situation progress smoothly.”
An Example of Springing Power of Attorney
Imagine your aunt suffers from dementia and can no longer pay her bills. She names you as the agent of her estate, and has a springing power of attorney in her estate documents that requires a physician to agree that she is mentally incapacitated. You will need to meet the outlined requirements of her springing power of attorney before you can take charge of her affairs.
How To Choose Who Gets Power of Attorney
Power of attorney is a vital tool, so consider empowering someone who will have your best interests at heart as your agent. After all, someone acting as your agent may be able to dispose of and sell anything that belongs to you, among other actions. “If you’re nominating someone who might steal from you, that’s a terrible situation all around,” Paquette said. “Anyone you choose to act on your behalf can clean out your accounts, so you should choose someone extremely trustworthy.” Be deliberate about your choices, she suggested. “Some clients put down their firstborn as their first-choice agent, but the firstborn lives across the country. The secondborn lives next door. Who will take care of things? Don’t choose a child on order of birth. Think about practicalities for incapacity and who can be relied on.” If a loved one has included a springing power of attorney and named you as an agent, consult with a lawyer, Paquette suggested. “If someone is acting as an agent, they need legal advice,” she said. “Make sure you’re represented as to what your duties are and what you can and can’t do, because you don’t want to be in hot water or facing personal liability if you mismanaged the estate.” Want to read more content like this? Sign up for The Balance’s newsletter for daily insights, analysis, and financial tips, all delivered straight to your inbox every morning!
