Executor / Executrix
The best place to begin in preparing your last will and testament is by deciding who will handle your affairs on your behalf once you are gone. This person can be called by a number of titles: your executor, if a man; your executrix, if a woman; the personal administrator of the your estate; or, the estate trustee. He or she should be well known to you and, in your best judgment, well capable of competently handling the sometimes complex and frustrating business of distributing your worldly goods. The responsibilities of the executor/executrix can be extensive, as you will see in the following list, which is by no means exhaustive but should illustrate some of the kinds of things that may be asked of your representative. At the bare minimum, your executor/executrix is responsible for:
· Your funeral arrangements and the payment of those expenses from your assets;
· The payment in full of your debts (credit cards, loans, etc.), possibly liquidating your assets (selling your stuff) to accomplish this;
· The care and security of any property that you owned until such time as it is either sold or distributed to your beneficiaries;
· Any legal action required. For example your will may need to be probated (validated) by a court of law;
· Filing of your final income tax return;
· Division of the residue of the estate (what’s left after the expenses have been taken care of) to your beneficiaries;
· Bearing the legal and financial responsibility for any oversight that may take place during the administration of the estate.
Clearly, this is not a small chore. In fact, in certain circumstances, it can be downright challenging and prohibitively time consuming. With this in mind, it would be prudent of you to discuss the idea with your candidate beforehand to be sure he or she is actually willing to accept such a commitment. It is also a good idea to discuss the contents of your last will and testament with your executor/executrix at length to ensure that they fully understand your wishes. You should also take measures to ensure that your executor/executrix knows where to find a complete accounting of all your assets when it is needed.
Husbands and wives will normally name each other to this position in their respective last wills and testaments. Other popular choices are immediate family members, grown sons or daughters for example. However, circumstances may change drastically over time. A previously willing executor/executrix may be unable or no longer willing to take the role when the time comes, leaving no one to administer your estate. In this case, an application can be made to the court and someone not of your choosing will take control of the execution of your will. To ensure against this eventuality, a second, and even a third alternate should be named, and these people must also be kept privy to updates to your personal affairs.
An executor/executrix is paid for their work, normally a percentage of the value of your estate, or an amount agreed upon and set out in the will.
If you are unable to find a person or persons who feel comfortable taking on this task, you may then turn to a professional such as your lawyer or a trust company that specializes in this work. Choose carefully. “Expenses” can skyrocket, draining the value of your estate. Unscrupulous representatives may follow the motto “there’s no sense in perfectly good money being wasted on the beneficiaries”.
Ideally, of course, you will have handled your own estate planning so well that there is very little for the executor/executrix to actually do. For instance, large assets that are held in joint ownership do not pass into your estate but immediately become the property of the living joint holder or holders. Insurance policies and retirement savings plans offer the option of naming a beneficiary, which will also keep the proceeds from passing to your estate. Be sure that you take advantage of this option and that the beneficiary information is kept current. An estate planning professional would be an excellent person to speak to in this regard.