Now hiring……Position: Executor
When preparing an estate plan there are many aspects to consider: Updating your will, updating your power of attorney for both personal care and property, tax planning, financial planning, legacy planning….the list goes on. A key piece of this planning is also naming an executor who will administer your estate when the time comes.
What I find interesting is that we sometimes make this decision based off complete emotion, guilt, or pressure without realizing that this appointment is a job like any other that we would normally post for in our own companies. In the world of seeking for a job, one must submit a resume to a company for a position that interests them, if they are qualified the company will then arrange for an interview and see if the candidate is suitable.
Person (let’s say me): “Thank you for coming in today and applying for the position of my Executor. Can you tell me what experience you have in administrating estates?”
Potential Executor (let’s say my daughter): “Errrrr, none”
Person: “Ok, why do you feel you would be a good fit for the position?”
Potential Executor: “Because I am your oldest daughter”
Person: “Excellent, you’re hired”
The above conversation is fictional but inspired by true circumstances. When considering who should be our executor the natural people we tend to gravitate to are: children, nieces/nephews, friends, cousins, (insert family member here) While it is important to choose someone that you trust and love, it is also wise to consider some other factors to ensure you are choosing the right person for the job.
TIME AVAILABILITY: What is going on in your potential executors life? Are they driving six kids to and from hockey practice? Do they spend four months of the year travelling? Do they have a job that demands long hours? Administrating an estate is a time consuming and lengthy process, the process of applying for a Certificate of Appointment (formally known as probate) can take several months…not to mention collecting all the assets, filing tax returns, distributing bequests and applying for a clearance certificate. This great honor that we bestow to our loved ones is a long process and quite the time commitment.
KNOWLEDGE OF ESTATES: Now I am not saying your executor needs to be the “rain-man” of estates, however does your potential executor have a general understanding of the process? Are they aware of your assets and liabilities? Have you reviewed your will together? There are a lot of steps to take when dealing with an estate and these steps must be done in a specific order to ensure successful estate administration. Will the person that you are considering understand that they should not issue any payments to beneficiaries before ensuring that funeral expenses, probate fees, income taxes and other liabilities are paid? An executor ends up having their hands in all sorts of matters such as: financial, tax, legal, real estate, investments, etc. Will your potential executor be the best fit to take on your estate?
RIGHT FIT: An executor must be able to push to get the information they require, however this doesn’t mean that your potential executor should be someone who will fight with anyone for any reason. Nor should they be someone who will be pushed over anytime they ask a question. What you are looking for is the “right fit”, sometimes an executor needs to push and fight in order to obtain information that is required for something. Other-times an executor must only listen when a beneficiary is venting to them about their siblings. It is a fine balance that they must master.
There are many more things to consider when determining the right person that should be your executor, some are technical skills and some are soft skills. If you take the approach as if this was a job opening and spend some time thinking about what you are looking for from your executor, then you will find the answer on who should fill that position. The answer or person may even surprise you!