Powers of attorney are legal documents you can create to give other people the ability to make legally binding decisions on your behalf. There are a wide variety of powers of attorney available for you to use, differing by the powers granted, the time when the powers take effect and how long the powers last. Power of attorney laws differ significantly between states, so it’s always best to talk to a lawyer if you want to create, grant or receive any power of attorney.
Powers of attorney can take effect immediately or at a later time. A power of attorney that takes place at some later time is known as a springing power. These powers only take effect if a specific condition takes place. For example, you can create a springing power of attorney that takes effect only if you become hospitalized or one that takes effect on a specific date.
Powers of attorney also differ based on when they terminate. A power of attorney typically ends when the principal, the person granting the power, becomes unable to make decisions. This is known as losing capacity. A principal who, for example, is injured in an accident and becomes comatose automatically revokes all powers of attorney. However, if the principal granted a durable power of attorney, those powers do not terminate when the principal loses capacity.
It is up to the principal to determine what kind of powers to grant with a power of attorney. Often, however, principals choose to grant one of two kinds of powers: financial and healthcare. A financial power of attorney allows the person receiving the power, known as an agent, to make financial decisions on the principal’s behalf, while a healthcare power of attorney allows the agent to make medical decisions.