Posted in Triplett & Carothers on May 3, 2024

An executor is responsible for ensuring your assets are distributed according to your wishes — a responsibility that introduces an element of legal and financial exposure. So choosing an executor is a serious decision. The person you select should have strong skills in at least some, if not all, of the following.

The potential executor should have organizational capabilities. These include the ability to act responsibly, to follow schedules and to understand financial matters. This does not mean that your executor has to be an expert in everything or fulfill all responsibilities personally. Executors can hire professionals — lawyers, accountants, real estate agents and even cleaning services — to help with different aspects of the estate. However, executors are expected to manage the process in a timely and ethical manner.

The potential executor should be in good health. Update your will if your chosen executor becomes unable to do the job or passes away.

Location is an important consideration. It is easier for an executor to administer the estate if they live close to your residence and physical possessions.

The potential executor should have a good credit rating. It is delicate to ask about this while you are making your choice, but it may help to explain that an executor bond may be required. The bond guarantees that the executor will administer the estate according to your will and the law, and it ensures that assets go to the beneficiaries. Someone with a less-than-solid credit rating could have difficulty and additional expense in obtaining the bond.

The potential executor should have solid communication skills. Executing your will can be difficult. Heirs and other interested parties may become anxious if they don’t know what’s happening. It can be very helpful if the executor can communicate well to keep everyone calm and satisfied.

Above all, the potential executor must be honest. Having fiduciary responsibility means acting ethically and following all applicable laws. Government agencies may have to be notified. Your residence may have to be emptied and sold. Your debts may have to be settled. Your taxes will have to be filed. Your assets will need to be distributed to heirs. All this exposes the executor to legal and financial risks. Failing to act can bring stiff penalties, including, in extreme cases, jail time.

Who’s right for you?

It’s a common practice to choose an adult child or a sibling to serve as executor. Some people select a parent or an aunt or uncle. Talk with several possible executors to ensure that they not only meet the criteria above but also understand what the role entails. It’s not an easy job and could possibly involve many hours of work — though it’s a job they may be honored to do for you.

It is a good idea to name alternate executors if your choice is unable or chooses not to serve. This will ensure that there’s still someone to manage your affairs who is trusted and who you think can handle the responsibilities. Another option is to name multiple executors. This can be helpful for having all your children feel included and for spreading the burden of executorship.

Don’t dismiss the idea of having a professional serve as your executor. Professionals already know the process and can ensure all applicable rules are followed. Of course, a professional might not be expected to care as much about your legacy or your heirs as a close friend or family member would. Additionally, they will expect to be paid for their work.

In many states, nonprofessionals also may be paid a fee. Approaches to fees vary. Sometimes it is a percentage — maybe 1% to 5% — of the size of the estate; sometimes it is an hourly rate or a flat fee paid from the estate’s assets. Nonprofessional executors may also choose to waive payment either out of respect for you or for their future relationships with your heirs.

It is a good idea to prepare prospective executors for the role; share resources with them so that they can learn about the responsibilities. When an individual agrees to serve, modify your will to explicitly add their name. You may give the newly chosen executor a copy of your will or disclose its location for when it’s needed. By making a considered decision about your executor and providing that person with the estate particulars, you will help ensure a smooth transition after your death.

Reach out to Roz Carothers and her team at Triplett & Carothers to learn more.

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