When preparing your will, and as part of your estate planning, give special consideration to naming an executor. The executor acts as your estate’s legal representative.
The executor role is complex, challenging, and often time consuming. For most executors, this is a once or twice in a lifetime role, with a steep learning curve and little room for error, while making the myriad of decisions faced.
The normal responsibilities of an executor include:
- Locating your original will and documents amending your will
- Confirming with your lawyer that the will is valid
- Securing inventories and appraising your valuables and assets
- Participating in your funeral arrangements and, if necessary, notifying next of kin
- Protecting your property including the continuation of fire and theft coverage
- Filing final tax returns of the estate
- Hiring a lawyer to obtain probate, if necessary
- Identifying debts, pays all bills, taxes, and creditors
- Getting investment, legal, business, and tax advice
- Distributing your assets according to your wishes, to your beneficiaries
When choosing an executor, consider the following:
- Choose a family member, if possible. Family members are normally motivated to work quickly and some will do so without a fee. By law, executors are entitled to collect up to 5% of your estate for their time and effort.
- Assess your particular needs. Do you operator a business; have substantial investments or rental properties? If so, you may need an executor with special skills.
- Consider your long and short-term goals. The execution of most estates can be completed in less than one year. However, if you have a disabled beneficiary, you may need to protect his/her inheritance on a long-term basis. This may require an executor who is prepared to undertake the role for a lengthy period of time.
- Avoid conflicts of interest. Don’t try to patch up family feuds by forcing relatives to work together as executors and don’t ask your financial advisor to be your executor as he/she may be in a conflict of interest.
- Name a back-up executor. Give consideration to naming a back-up executor who would take the place of your executor if for some reason your original named executor cannot fulfill his or her duties.
- Ask for consent in advance. Before you invest time with your lawyer preparing your will, get your proposed executor’s verbal consent. Professional executors, such as a trust manager, will normally consent in writing and at the same time, confirm the fees to be charged.
For further information and frequently asked questions, Google, ‘duties of an executor in your specific province or state.’