When setting up an estate plan, a Last Will & Testament is almost always involved. As we have explained in another article, your Will covers assets that must go through probate. But this isn’t automatic. Someone has to carry out your plan—that’s your Executor. You should think carefully about who you want to name as Executor.
Choosing your Executor is a critical decision. Contrary to what many think, this is not just an honorary title. It’s an important responsibility. And it involves a significant amount of work. Let’s discuss some key considerations when thinking about who your Executor should be.
Your Executor Needs to be Diligent and Action-Oriented
Being an Executor means there are important responsibilities to carry out. These include consulting with a probate attorney, filing a petition to probate the deceased person’s Will, gathering assets, creating an inventory and accounting, handling debts and expenses, and distributing assets.
While a probate attorney will help with legal filings and necessary court appearances, the Executor is the one who must do most of the legwork. This means your Executor needs to be someone who will be able to take action promptly and not allow things to linger.
An Executor owes a fiduciary duty to the Beneficiaries of the Estate. He or she must act with reasonable care to protect their interests. Failure to act can be a breach of fiduciary duty, for which the Executor may be personally responsible.
Your Executor Should be Financially Savvy
The Estate of a deceased person contains a variety of assets. This may include bank accounts, investment accounts, tangible personal property, businesses, and real estate.
Because of the variety of matters an Executor may have to deal with, your Executor should have a good grasp on the basics of personal finance.
If you own a business that will have to be probated, your Executor should also have insight into how your business operates. He or she needs to be capable of making day-to-day decisions to run the business during probate. If this is not so, then the probate court may have to appoint a receiver to handle the business.
Probate is not where someone should be putting on financial training wheels for the first time. Choose someone who has proven themselves competent with financial and/or business matters.
Your Executor Needs to be Highly Trustworthy
Somewhat related to diligence is trustworthiness. You should have the utmost confidence in this person and his or her abilities to get the job done. He or she should have impeccable character and integrity, such that you would trust him or her with your affairs while you are living.
If you have hesitations about someone being your Executor, you should probably not choose that person. Whatever the reason, if there is something that causes you not to fully trust him or her to get the job done, look for another person to fill this role.
This is especially important if your Will waives bond. Normally, the law requires an Executor or Administrator to obtain a bond, which can be quite expensive. But many Wills that attorneys prepare waive the need for a bond.
If the Will waives bond, this means less upfront expense for your Executor. But it also means that there is potentially less recourse if he or she mismanages the Estate. Choosing someone highly trustworthy is a wise way to avoid this problem.
Your Executor Should Understand Your Family and Values
It’s also a good idea to have an Executor who knows you at an intimate level. This person should understand what your family dynamics look like and what is important to you. And he or she needs to be able to navigate potential conflict among family members and other Beneficiaries of your Estate.
If there are ambiguities in your Will, your Executor may sometimes have to make judgment calls about what your wishes are. Someone who has known you for a long time would likely be able to think through your values and come to a conclusion that is close to your intentions.
Your Executor Does NOT Have to be a Family Member
Almost as relevant as thinking who to name as Executor is thinking who *not* to name. Or, who you don’t *have* to name as Executor.
While it’s common to name a close family member as Executor, this is not required. In fact, almost anyone can be an Executor, subject to a few limitations for those with certain criminal convictions.
Viable alternatives may be close friends, an accountant, or financial advisor. Your attorney may also serve in this capacity, if you wish.
So if you don’t have a family member you fully trust, look to your social circle and professional connections next.
Final Thoughts on Who to Choose as Your Executor
Having a competent, trustworthy, and financially savvy Executor provides greater peace of mind about your legacy plans.
Estate planning conversations often center around “who gets what.” But these conversations should involve more “who does what.”
Start having conversations about your estate plan with your family now. If you want to have a non-family member as Executor, have a discussion with him or her about the idea. This person needs to know what’s required to carry out these responsibilities.
While these conversations may be uncomfortable, they are highly important. Don’t push these matters off for tomorrow. Plan today for a more peaceful tomorrow.
Connell Law, PLLC provides residents of Rutherford County and the surrounding area with legal counsel in estate planning and probate. Reach out to us today to request a consultation.
