Responsibilities Abound, Choose Wisely
Procrastinators usually face problems. The scramble to get things done in a timely manner. Often, they make less than optimal decisions. This is especially true of people who procrastinate on the issue of estate planning.
This type of procrastination generally can’t be turned in late because….well, you’re probably dead or incapacitated. If you don’t take the time to plan properly now, it can cost your family big time in the future. This is exceedingly true when it comes to choosing the right executor to handle your affairs after your passing.
Most people think that being an executor is an easy job. There truly isn’t much to it, or so they reason in their head. In reality, it’s quite the opposite.
Executors have numerous significant responsibilities. They can collect from debtors, inventorying the assets of the estate and protecting them, filing estate tax returns and paying related taxes, dealing with creditors, handling investment decisions and liquidating and distributing assets and property to beneficiaries.
So, who should you choose as your executor? Most people just assume a family member of a close friend will do it. However, that’s not always a safe assumption. As this article from Kiplinger states, you need to talk to your potential executors and make sure they’re willing to take on the task AND they’re actually up to it.
Things you should consider before naming an executor:
- Will this person be too grief stricken at your passing to do the job effectively?
- Does this person stand to gain from your will and if so, will that be a conflict of interest?
- If the previous statement applies, do you think that it will lead to disputes between family members and/or other beneficiaries of the estate?
- Is your potential executor a trustworthy person with a good knowledge of financial best practices?
- If this person needs to hire professionals, will they be professionals you would trust?
To avoid these risks, we always recommend that you examine your potential executors carefully before giving them these kinds of responsibilities. If you believe that your potential executors lack the financial acuity or moral authority to handle your estate you may need to look elsewhere to find a good executor, even if you believe you may end up hurting some feelings.
In the end, having a plan is the key ingredient to estate planning. However, to hone your estate plan and ensure it is successful in distributing the assets in a way that puts you at peace, you need to put in the extra leg work to make sure you have a good executor or team of executors to handle your final wishes.
When you’re ready to get started with your estate plan, give us a call. We’ve helped thousands of people put together a solid basic estate plan and we’re ready to do the same for you.