What is an Executor?
An executor, or personal representative, is the individual or entity responsible for managing your estate following your death. An executor is a fiduciary. This means that he or she has a legal duty to act in the best interests of the estate.
An executor can either be named in your last will or appointed by a court if you die without a will.
How to choose an executor
Much like choosing a legal guardian for your child(ren), selecting an executor and even a Co-executor is a decision that you should take seriously and probably discuss with the one you have in mind. Call them or get together to discuss this task. Some of the executor’s responsibilities include:
- Filing a copy of the will with the probate court
- Setting up a bank account to collect funds and pay liabilities
- Maintaining property
- Filing an inventory of the estate’s assets with the probate court
- Distributing assets
- Paying estate debts and taxes
Choose someone that's responsible
This does not mean that your executor needs to be a professional executor like an attorney or dedicated estate settling service provider, these are good options but far more costly than choosing a reliable individual to serve as executor. some things to consider
- Avoid those that may be disqualified, for example, convicted felons, those under the age of 18 (21 in some states), and those that reside outside of the U.S.
- Consider someone younger and healthy
- Choose someone that lives nearby, location plays a big role when having to appear in probate court or visit a local bank branch, your home, although technology has made it easier these days.
Consider a professional
There are some situations where appointing a family member is not ideal.
First, there may be no family members or friends that are capable of serving and/or are disqualified under state law.
Second, the estate may involve complex assets and liabilities that are better understood by some that understand them. Take cryptocurrencies for example a new study performed by Nasdaq.com shows that about 17% of the adult population (46 million Americans) own these modern assets. Selecting an executor that understands how to transfer them is important.
Third, there is value in the fact that a professional is a neutral party and is not tied emotionally to you or your family. They ensure everything moves smoothly.
Serving as an executor can also pose a lot of work for many months and you want to make sure that your chosen executor is up to the job.