Not every power of attorney is sufficient to regulate your affairs if you become incapacitated. A general power of attorney expires if the client becomes incompetent. A permanent power of attorney, however, remains.
In many states, powers of attorney can “arise”. Such powers are exercised today but will not take effect until a specific event occurs. For example, the authority could “take effect” when the headmaster’s doctor confirms in writing that the headmaster has become incapacitated.
However, some lawyers do not recommend spring force as it just adds another layer of uncertainty at a time when clarity is needed. In practice, some doctors do not want to record that someone is incapacitated for work due to possible liability. Situations in which the client gets in and out of the incapacity for work also raise questions about the application of spring force.
After you have drawn up, signed and witnessed a power of attorney, you should submit copies of this document to the financial institutions with which you do business. You want to be sure that your bank or brokerage firm accepts your power of attorney. If there is a problem and you find out in advance, you can work with the institution to get a document that will be recognized.
The problem may be that the financial institution is reluctant to allow your son Bob to make decisions about your account unless there is absolute certainty that Bob has the right to act. Many financial institutions have their own power of attorney forms that they prefer to use.
Although a power of attorney is technically forever valid, a financial institution can challenge it in the real world if the document appears out of date.
You should therefore renew a power of attorney approximately every five years. If your circumstances have changed, you may want to change the document too.
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