Selecting the executor of your estate is one of the most important decisions you’ll make in your estate plan.
As the person responsible for carrying out your final wishes, you need an executor you can trust to faithfully execute their duties and act in the best interest of your beneficiaries.
So, how do you choose the right executor? There are several factors to weigh when making this key appointment.
What’s the Role of an Executor?
Before naming an executor, it’s important to understand their role and responsibilities.
The executor is the person who will be in charge of your estate after you pass away. Their core duties include:
- Filing the will with the probate court and initiating probate proceedings
- Notifying beneficiaries and heirs of your passing
- Creating an inventory of estate assets and valuations
- Using estate funds to pay any outstanding bills or taxes owed
- Distributing remaining property to beneficiaries according to your will
- Filing final tax returns on behalf of the estate
Essentially, the executor handles all legal and financial matters for your estate until everything is distributed. It’s a big job, so you need someone who is reliable, organized, and trustworthy.
Key Factors to Consider in Your Executor
When evaluating potential candidates for executor, here are some of the most important qualities and qualifications to look for:
Reliability and Strong Organization Skills
Due to the many deadlines and details involved, you need an executor who is highly responsible and organized. They should be diligent with paperwork, good at managing timelines, and attentive to details. Disorganization can cause costly mistakes.
Look for someone with a track record of reliability in handling important matters. Their organizational skills will ensure they can juggle the many moving parts without dropping the ball.
Relevant Knowledge and Experience
Some background knowledge of legal and financial matters can be beneficial for an executor. While they can work with attorneys and accountants, a basic understanding of estate administration and terminology helps them communicate effectively and make informed decisions.
Prior experience with settling an estate or serving in a fiduciary role provides useful preparation. People with professional backgrounds, like lawyers or financial advisors, often make great executors.
Availability and Proximity
Consider choosing an executor who is relatively nearby and available to handle estate tasks in person when needed. Out-of-state executors can complicate the process if they can’t easily access local institutions or courts.
Of course, availability also means having the time in their schedule to devote to executor duties. Be wary of naming executors who already have demanding jobs or travel frequently.
Impartiality and Ability to Be Fair
Executors should be able to set aside personal biases and treat beneficiaries equally. Family dynamics and second marriages make impartiality essential.
If a potential executor has contentious relationships with certain heirs, look for someone who can objectively follow your wishes without playing favorites. Keep the peace by avoiding complexity.
Who Can Serve as Executor in Alabama?
You have several options when choosing an executor. Common choices include:
Spouses and Trusted Family Members
Naming your spouse or adult child as executor is convenient, and they’ll have a personal interest in honoring your wishes. However, be mindful of existing family tensions that could hinder their impartiality.
Professionals Like Attorneys or Accountants
These professionals are well-versed in estate administration and have experience navigating the probate process. However, their specialized expertise comes with higher fees.
Responsible and Impartial Friends
Consider close friends with the right temperament and business acumen. Their detachment from family disputes can allow them to be fair executors.
Co-Executors
Combining a family member and a trusted professional or friend is a balanced approach. This blends intimate knowledge of your affairs with legal or financial expertise.
Signs It May Be Time to Change Your Executor
Your choice of executor is not set in stone. As life circumstances evolve, the person you originally appointed may no longer be the best fit.
Be on the lookout for certain signs indicating it could be time to change your executor:
- Your relationship has deteriorated – A falling out with the person diminishes trust in their impartiality and judgment. Any ill will could impact their desire to honor your wishes.
- They are dealing with serious health issues – Worsening health problems that affect memory, focus or mobility may hamper their ability to manage executor duties.
- Significant life changes – If an executor relocates far away, takes on greater responsibilities at work, or experiences a major life change impacting availability, this may impede their capacity to serve effectively.
- Lack of confidence in their skills – You might realize an executor lacks needed knowledge or organizational skills as your estate becomes more complex. Better to switch now than risk problems later.
Revisiting your executor choice occasionally ensures it continues to meet your needs as circumstances evolve. Don’t hesitate to make a change when needed.
Executor Fees: What’s Reasonable?
If you appoint a professional or corporate executor, understand that they will charge fees for their services. What’s considered reasonable?
- Individual executors – Most charge an hourly rate similar to their professional services. Friends or family may serve gratis or for a reduced rate.
- Corporate executors – Banks and trust companies charge sliding scale fees based on the value of estate assets. Typically this ranges from 1% on smaller estates up to 3-5% for large estates.
- Attorneys – May charge hourly fees ranging from $200-$500+ per hour depending on experience level and location. Approximately 10-30 hours is common for average estates.
The executor is entitled to reasonable compensation for their time and services. However, as the estate creator, you can specify fee expectations in your will to provide helpful guidance. An experienced estate planning attorney can ensure compensation structures reflect your preferences.
Best Practices for Naming an Executor
Here are a few final tips for choosing an executor:
- Discuss the role with potential executors before officially naming them. Confirm they feel capable of the responsibility.
- Designate at least one or two backup executors in case your first choice dies or becomes incapacitated before you.
- Re-evaluate your choice every few years as circumstances evolve. Change your will if new options emerge or relationships deteriorate.
- Seek legal advice to ensure you appoint executors properly and they can serve according to Alabama laws.
Choosing the right executor is too important to take lightly. Ensure you make a thoughtful, informed decision by evaluating all aspects covered above. If you need guidance on structuring your estate plan, contact the estate planning attorneys at the Law Offices of Brenton C. McWilliams to set up a consultation.
Their team has assisted many clients in Alabama with designating executors and crafting customized plans aligned with their wishes and goals. They can help you as well.
Visit their website today at https://brentonmcwilliams.com/.
