According to surveys, more than half of American adults don’t have a Last Will and Testament. While the reasons for this vary, one stumbling block can be choosing an executor. Suzanne Himes, lead financial planner at Asset Planning Corporation, joins us with what to consider in selecting someone for this important role.
SUZANNE, THIS IS SUCH AN IMPORTANT PART OF OUR ESTATE PLANNING. WHAT ARE SOME OF THE REASONS TO HAVE A WILL IN THE FIRST PLACE?
Keep in mind that if you don’t have a Will, the government will make one for you; distribution of assets and other important decisions will be determined according to generic state law; may be a lot different than what you want.
A few top reasons to have a Will are:
- Appoint a guardian for minor children
- Decide who receives your assets
- Provide for a favorite charity with a legacy gift
- Make a difficult time a little less difficult for loved ones
WHAT DUTIES DOES A WILL’S EXECUTOR PERFORM?
It can be a very time-intensive job, depending on the size of the estate. Some of the most common functions include:
- Filing court papers to start the probate process
- Taking inventory of the assets in the estate
- Paying final expenses from the estate (taxes, funeral costs, medical bills)
- Closing accounts, notifying banks, SS office, etc. of death
- Preparing final tax returns
- Distributing assets to beneficiaries named in the Will
WHAT ARE SOME THINGS TO CONSIDER WHEN MAKING THIS DECISION?
Consider the following guidelines for choosing an executor:
- Scope of the estate (how complex)
- Individual skills AND capacity – don’t need them to be a legal or financial expert, but DO need to have common sense; who will know when it’s time to bring in those experts
- Family dynamics
- Age and health of that person? Are they likely to be around?
- Confirm they are legally eligible to serve
- If no family member or close friend fits the description, may need to consider a corporate executor
IT SOUNDS LIKE IF WE HAVE CREATED A WILL WE’RE ALREADY A STEP AHEAD BUT WE MAY WANT TO REVIEW WHO WE’VE NAMED AS THE EXECUTOR?
- Get approval from whoever you’ve chosen before naming in your will
- Regardless of who you choose, it’s important to review every few years, especially when other life events happen