A springing power of attorney is a power of attorney that “springs” into effect when you become “incapacitated”. The idea that your power of attorney would only be able to manage your finances when you are unable to handle them yourself sounds like a good idea, but logistically, it is cumbersome and potentially detrimental to your financial well-being.
There are a few questions that come up when determining whether the springing power of attorney entitles your agent to act on your behalf at any given time. What does it mean to be incapacitated? Who determines your capacity? When does the power of attorney go into effect and how long does it last?
The law may not define incapacitation the same way you would. Legally, an incapacitated person is someone who is impaired due to mental illness or deficiency, physical illness or disability, who lacks the capacity to effectively manage his/her care for self or property. Obviously if you are in a coma, you are incapable of making financial decisions for yourself, but if you have dementia, lucid one day and not the next, are you considered incapacitated? It depends on who you ask. If an attorney meets you on a good day, he/she may say you are competent, but your doctor, who has been treating you for years, may not necessarily agree. With a springing power of attorney, someone else determines your capacity.
While doctors and lawyers are determining your capacity as required by many financial institutions before a springing power of attorney takes effect, your financial affairs are left unattended. These proceedings are also an undue burden for your agent, presumably a family member or friend, who just wants to take care of your obligations. The entire purpose of having a power of attorney is to allow your agent to act in case of an emergency.
Overall, a springing power of attorney sounds good on paper while you are healthy, but in practice, it could do more harm than good. You want your agent to be able to act quickly in case of an emergency. You do not want banks or financial institutions having to make the determination of whether you are truly “incapacitated” before honoring the power of attorney document. A durable power of attorney allows your agent to immediately act on your behalf when needed, and a well-chosen agent will always consider your best interests before any others. When you are ready to prepare your power of attorney documents, contact an experienced attorney who will help you tailor the document to your needs.
 Note that we place the word incapacitated in quotations. This is because there are often disputes over what this phrase means. In other words, your doctors may not even agree. This is the heart of our concern with springing power of attorney documents.