How do you decide who to designate as the executor of a will or trustee of a trust? Estate planning attorneys advise careful attention to making these decisions. Though sometimes families treat the designations as a mere formality or ceremonial honor, they actually come with a lot of responsibilities. Here are three suggestions from the experts.
Three Suggestions
When you have the luxury of time on your side, it’s best to take the appointment of the those who will ultimately see to your affairs seriously. Making the right choice is not about whose feelings get hurt or playing favorites. Instead, the right choice involves practical considerations. For example, it’s important to consider who has time—and the ability to commit it. Spending time to understand your intentions, legal documents, accounts and financials is a commitment that begins immediately upon being designated as a fiduciary for your estate plan. Here are three suggestions from Wilson & Wilson to help you avoid mistakes when choosing your representatives:
- Give preference to those who have the most time to devote and live nearby.
You may have children who are very successful professionals…,but sometimes these are not the best choice since they often have tighter schedules and less time to devote….Also take into account if any of your children have more children of their own to care for or other time-consuming obligations….
- Do not make arbitrary designations
Another mistake people sometimes make is choosing…based on arbitrary characteristics that have nothing to do with the role they would serve. This can include appointing one child just because they are the oldest, or appointing someone based on their gender…. Arbitrary factors should not outweigh other factors that are much more important.
- Avoid naming multiple agents, when possible
In order to make sure no child feels left out, some people want to appoint all of their children to every position….This frequently leads to disagreement and delay when decisive action needs to be taken….It’s best to avoid naming all of your children or multiple other agents for the same role.
The executor of a will and the trustee of a trust have a fiduciary responsibility to act in the best interest of the estate and beneficiaries. Accordingly, executor bonds and trustee bonds are often requested. Essentially, these fiduciary bonds guarantee the faithful performance of the executor in accordance with the law. Colonial Surety Company makes it quick and easy to get executor bonds or trustee bonds The steps are simply: get a quote online, fill in the information and enter a payment method. The bond can then be e-filed or printed from anywhere—even before leaving the law office
When To Consider a Professional Fiduciary
Sometimes estate plans are fairly straightforward, in which case friends or relations can be a good choice for serving as the fiduciary who will ultimately carry them out. As Collins Law Group points out, however, some circumstances make appointing a professional fiduciary the most sensible thing to do. For example, large or complex trusts might benefit from deep legal and financial expertise, and conflict-prone family dynamics might be improved by the neutrality a professional offers:
Administering a trust requires a good degree of knowledge of state and federal laws that govern the trust. Most non-professional Trustees lack the legal background necessary to understand these laws whereas a professional Trustee is often an attorney himself/herself or has one on staff…The overall success of a trust depends, to a great extent, on the Trustee’s ability to successfully invest and grow the trust assets. Professional Trustees do this for a living, day in and day out…When the Trustee of a trust is a spouse, family member, or friend it almost always means that he/she is personally acquainted with the trust beneficiaries. This, in turn, dramatically increases the potential for conflicts during the administration of the trust. Conversely, appointing a professional Trustee effectively removes the likelihood of most conflicts.
Curious? Fact Or Fiction?
It can be interesting to examine the choices made by others when designating fiduciaries to oversee their affairs. For example, Paul Allen, the co-founder of Microsoft, designated his sister to execute his estate. What about Batman’s estate? Perhaps Alfred Pennyworth, the faithful butler? Certainly Alfred seems like a solid choice for the responsibilities of the executor. But, at least according to Aaron Schnoor, Bruce Wayne entrusted the duties of executing his will to James Gordon.
Regardless of the type of the estate plan or circumstances, fiduciary bonds can be helpful—or even required. Across the country, lawyers and their clients rely on Colonial Surety’s efficient online service to quickly obtain a quote, make the purchase and instantly print or e-file the bond. Colonial’s fiduciary bond portfolio includes: trustee, conservator, guardian, personal representative, administrator, estate, executor, probate, surrogate, and more.
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