As an attorney who not only drafts wills and trusts but also helps families administer estates, I have witnessed how not selecting the proper executor can lead to three unintended consequences.
The executor, ideally, is selected because they are trusted and responsible; not just because they are the spouse or child. However, these admirable traits are not enough if you want to have a quick, efficient, and conflict-free estate administration. By pairing your executor with a professional, by either naming a one in the will or advising the executor to hire one, ensure that your wishes are honored and costs are kept low.
Being an executor takes time. One must obtain death certificates, find the original Will, compile a list of individually as well as jointly owned probate assets (which might not be immediately known) and fill out paperwork in order to be sworn in as executor. This often means that the individual is taking off of work and spending considerable time just in the application process in order to go to the Register of Wills so that they can be sworn in as executor. Once appointed, an executor has many more responsibilities to perform and a short window to do it in if they are to avoid unnecessary taxes and penalties. Naming an executor who lives out of state or who has full-time commitments can further delay the estate administration process and result in avoidable fees. A professional can ensure that the proper forms are filled out quickly and properly and take advantage of allowable deductions.
Naming a loved one to fulfill your last wishes may make sense. However, that same loved one is grieving and trying to figure out cope with your loss. Layering that with legal and fiduciary responsibilities can be a recipe for disaster. Executors have a responsibility pay creditors and protect the estate’s value. The executor must contact credit card companies, inventory property and secure personal items, file and collect insurance claims, notify organizations providing retirement benefits, social security benefits, open a bank account, transfer title of certain assets, meet with decedent’s financial advisor(s)/accountant/attorney, redeem bonds and more. I have witnessed clients come to me in tears with bag of papers looking for direction and reprieve. Hiring a professional to administrate the estate and negotiate with creditors can alleviate stress.
Unnecessary Risk & Conflict
Executors who are not professionals often inadvertently act and put themselves at personal risk. For example, executors are responsible for distributing assets to beneficiaries and are personally liable for any improper distributions made before taxes and other creditors are paid.
Also, beneficiaries often have misconceptions of how long an estate takes to administer and may believe that there is foul play at hand if it they do not receive their inheritance as quickly as they would like. I have seen children sue their father’s girlfriend of 20 when they found out that she was named as executor. Similarly, there are problems when naming children. Naming one child over another can feed into narratives of that child having undue influence over the deceased parent or of being the favorite. Conversely, naming multiple children is a headache and prone to failure if the children don’t get along. As an example, since each executor’s signature is needed to sell a property, one executor can delay the sale and use their status as leverage to receive a larger share. A professional on the other hand knows what the laws require and can be impartial.
If you are serving as an executor, enlisting a high caliber professional is important. This person will counsel you and your family to ensure that the process is as smooth, efficient and stress-free as possible.