Choose the right kind of power of attorney

Know the differences between durable general and springing powers of attorney.

Article published: April 17, 2023

By: Erin Gilmore Smith Director of Estate Planning

A good financial plan aims to prepare for the unexpected – the bad as well as the good. Being suddenly incapacitated is an example that no one likes to think about, but a sudden accident or chronic illness could prohibit your ability to perform basic financial tasks like paying your bills and filing taxes.

Yet, you can protect your financial well-being as well as those of your loved ones if you plan for it. You may want to consider designating a third party to make all financial and non-health-care decisions on your behalf in case you’re unable to do so on your own. This requires executing a power of attorney document and it involves careful thought. After all, you’re granting this third party, also known as an “attorney-in-fact,” a lot of power over your life, including all financial decisions. You should know that your attorney-in-fact has a fiduciary duty to act in your best interests.

It stands to reason that your attorney-in-fact should be someone whose judgment you trust implicitly and who will not use the power of attorney until it is needed – perhaps your spouse, an adult child or a close friend.

You also need to decide what kind of power of attorney you want – a durable general power of attorney or a springing power of attorney. Let’s outline the differences.

A springing power of attorney

A springing power of attorney only “springs” into effect upon a certain event, such as your incapacitation. If the event is incapacitation, the document often requires that one or two medical doctors certify that you’re incapacitated before the power of attorney goes into effect.

While this hurdle may seem an attractive option if you are concerned about ceding so many decisions about your life to someone else – even if you have complete trust in that person – the reality is that it can be difficult to obtain that certification.

While your attorney-in-fact, and likely, concerned family members, are waiting for doctors to declare you incapacitated, all your non-health-care decisions are unable to be made, including bill payments and investment matters.

A durable general power of attorney

Unlike a springing power of attorney, a durable general power of attorney becomes effective as soon as the document has been signed. This adds additional flexibility to your power of attorney document. For example, your attorney-in-fact is able to make decisions on your behalf if you are simply unavailable to do so yourself, such as if you are traveling or are recovering from a physical injury.

Whether you execute a springing power of attorney or a durable general power of attorney, your attorney-in-fact would need to present the power of attorney document to financial institutions and others as proof of their decision-making authority. If your attorney-in-fact does not have the original copy of your power of attorney, be sure to let him or her know where to find the document.

The information regarding estate planning should not be construed as tax or legal advice and is for general informational purposes only.


Neither Edelman Financial Engines nor its affiliates offer tax or legal advice. Interested parties are strongly encouraged to seek advice from your qualified tax and/or legal professionals to help determine the best options for your particular circumstances.

Erin Gilmore Smith

Director of Estate Planning

Erin Gilmore Smith is a director of estate planning at Edelman Financial Engines. Erin has worked in the financial services industry for more than 15 years and specializes in developing comprehensive estate planning strategies and solutions for high-net-worth individuals. Erin earned degrees from Seton Hall University School of Law and Texas A&M University, and is admitted to the bars of New York, New Jersey and Connecticut.

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