“Power of attorney” isn’t one document — it’s a category, and the two ways it splits (what it covers, and when it starts) matter more than most people realize until they’re stuck without the right one.
Financial Power of Attorney
A financial (or “general”) power of attorney lets your named agent manage money matters on your behalf — paying bills, managing investment accounts, filing taxes, handling real estate transactions. This is a separate legal document from a healthcare power of attorney, and naming the same person for both is a choice, not a requirement.
Healthcare Power of Attorney
A healthcare power of attorney (sometimes called a healthcare proxy) names someone to make medical decisions for you if you can’t make them yourself. It only covers treatment decisions — it doesn’t give your agent any authority to touch your bank accounts or sign financial documents. This is why the retirement-account-specific version of this question — who can actually manage your IRA if you’re incapacitated — comes down to the financial POA, not the healthcare one.
Durable vs. Springing: When It Actually Takes Effect
A durable power of attorney takes effect as soon as you sign it and stays in effect through incapacity, ending only at death. A springing power of attorney only activates once a specific triggering condition happens — typically a doctor’s determination that you’re incapacitated. Springing POAs feel safer (your agent has no power until you actually need them to), but the tradeoff is real: proving incapacity to “spring” the document can take time, sometimes at exactly the moment fast action is needed.
What Happens With No Power of Attorney at All
Without a valid POA in place before incapacity, your family typically has to petition a court for guardianship or conservatorship — a public, often slow and costly process that a signed POA is specifically designed to avoid. It has to be signed while you still have legal capacity; you cannot execute one after a incapacitating event has already occurred.
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