A will specifies your instructions as to how your assets will be distributed on your death. In the will, you name an executor to act as your personal representative and to deal with all the tax, investment, administrative, and other duties involved in distributing and overseeing your assets as per your instructions.
Some people feel honored to be named as the executor, in that it suggests respect and trust in their abilities. How-ever, most people fail to realize how much responsibility is required, the amount of time and effort that the appointment often necessitates, and the family conflicts that might arise.
Here are some of the responsibilities of an executor:
- Pay the bills, obtain death certificates, make the funeral arrangements if required,
- Locate and list all the assets of the deceased,
- Arrange the probate of will if applicable,
- Take control of the assets and contact financial institutions to change the name on the accounts to “the estate of”,
- Ensure the applicable trust laws are complied with at all times,
- Manage the assets of the deceased as the trustee,
- Assess the tax situation and file any required returns,
- Prior to distributing assets to heirs, settle any out-standing debts.
Conflicts often arise between the executors and the heirs. The beneficiaries may be suspicious of the executor be-cause he or she does not have enough knowledge or skills, is insensitive, is too hasty, shows favouritism, etc. Anyone who is appointed as an executor should be aware that these are common situations during emotional times.
An executor requires many skills. One of the most important is the ability to know when outside expertise is required. An executor frequently hires a lawyer, accountant or trust company for assistance. Sometimes, appointing an in-dependent outside party, such as a trust company as the executor may be the best choice, especially when a family conflict can be expected.