Who Will Serve as Your Executor?
The first decision you need to make is who will serve as your executor. Your executor is the person or entity that is in charge of probating your estate after you are gone. You should make this decision in the same way you might decide whether or not you want to become chairperson of a committee. For instance, if you were asked to be chairperson of your homeowner's association, you would probably ask questions such as, “What do I have to do?” “How much time do you think it will take?” “Will I have help from the neighbors?” “Do you think I'm the best-qualified person to serve?” Interestingly enough, these are the same kinds of questions you need to ask regarding who should serve as your executor. When you learn the duties of the executor, you will be prepared to choose the right person or entity to serve.
If you are concerned that your executor might tamper with your will, that person is not a good choice to handle your estate. You want someone you can depend on to carry out your wishes just as you would have.
Your executor needs to be a person or an entity that you trust to handle the job. The duties of your executor will depend on several factors:
The instructions you put in your will
The nature and extent of your property
The special needs of your loved ones
The possibility that someone will contest your will
Pretend you are writing a job description. The more detailed and specific you are about what you want the executor to do, the easier it will be for him to do the job. There are certain duties all executors must perform:
Locate your will
Probate your estate
Decide how and when your property will be distributed
Locating Your Will
The first job for your executor is to locate your original will. You can make this job very easy by simply telling her where to find it. However, this requires a great deal of trust. If you are worried that your executor might try to change your will without your permission, you obviously don't want her to have access to the original document.
You can also put your original will in a safe-deposit box. If you do this, your executor either needs to have access to the safe-deposit box or be able to contact the person who does have access after your death. See Chapter 21 for a further discussion of safe-deposit boxes.
You can protect against this possibility by filing your original will with your local probate court for safekeeping. After you are gone, your loved ones can present the probate court with proof of your death, and the original document will already be on file with the court.
Or, the lawyer who drafts your will can keep the original will for safekeeping. The important thing is for the executor to know where to find it.
Probate Your Estate — Hiring a Lawyer
The executor's next job is to probate your estate. It is almost impossible to probate an estate without the assistance of a lawyer. Many executors think they have to hire the lawyer who drafted the will, no matter how much the lawyer charges. This is not true. Your executor is free to ask the lawyer to hand over the original will, if he is holding it, and then shop around and hire a lawyer who will do the best job for the best price.
It is important for your executor to know how the lawyer bills, and how much the lawyer estimates the job will cost. Here is another opportunity for you to lighten the burden. When you are thinking about hiring a lawyer to draft your will, ask not only how much he will charge to draft the will, but also how much it will cost to probate your estate after you are gone. You can then make a recommendation to the executor about using the same lawyer or seeking someone else.
How and When Your Property Will Be Distributed
The lawyer will prepare the necessary paperwork for the court to probate your estate. Your executor is the one who must decide how and when to distribute your property unless, of course, you make those decisions and include the instructions in your will.
If you think the lawyer is charging too much to prepare your will or will charge too much to probate your estate when you are gone, don't be afraid to shop elsewhere!
The number of decisions your executor needs to make will vary, depending on how specific you were when you created your will. The executor has no choice but to follow the instructions you left. If you give the executor very general instructions, such as “Divide all of my property equally among my children,” the executor is left with the responsibility to decide exactly what each child receives. On the other hand, if you are very specific in your will — for example, “My son should receive my fifty shares of XYZ stock, and my daughter shall receive my ABC mutual fund” — the executor must distribute the XYZ stock to your son and the ABC mutual fund to your daughter. You have made the decisions about what each child should receive rather than shifting the responsibility to your executor.
Considerations in Choosing an Executor
Choosing who should serve as executor is dependent on how specific your will is. If you make most of the decisions while you are living and your will is very specific about what each person is to receive, it is less important who you name as executor. But if your will is very general, the job requires more discretion by the executor. The person you choose to serve must make all of the decisions about what property each person named in your will is to receive. It is much more likely that your loved ones will disagree and perhaps contest the decisions of your executor when you are less specific.
More than one person can serve as your executor. When you name two people to act as executors, both executors must agree on all decisions and sign all of the paperwork. Naming multiple executors to provide a check and balance on the decision-making process makes sense. However, when you name more than two co-executors, making decisions and executing the necessary paperwork often becomes difficult.
If any of your loved ones have special needs, this may affect your choice of executor. For instance, you may choose one of your children to serve as your executor because you know that child will make the best decisions for the child who has special needs.
You also can name a professional executor. Banks and trust companies are available to serve as an executor of your will. The fee professional executors charge varies, but it is typically a flat fee, possibly $5,000, and a percentage of the value of your probate property. The company may also charge an additional fee for handling nonprobate property. As you can see, it is very expensive to use a financial institution as your executor. That is one reason most people who choose a will as their estate planning document do not name a professional executor.