What is an executor?
You need to make sure your last wishes are followed in the manner you've laid out. That's why it's so important to pick an executor for your estate. Skipping this vital step can throw a wrench in your carefully crafted plans and delay distribution.
In the simplest terms, an executor is the person who manages your estate once you have passed. This person (or persons) is in charge of going through your will and making sure your last wishes are followed.
An executor is legally obliged to manage your best interests. With the right executor, you won't have to worry that the guidelines you've laid out won't be followed. That's another reason why it's so critical as you begin your estate planning process to create a will.
Why you should have an executor
First, understand that if you don't name an executor you won't have a say in the appointment process. This is similar to what happens if you die without a will, your estate becomes "intestate" and the court will name an executor to manage your affairs.
Whoever you choose as your executor will be in charge of many important decisions, including:
- Paying any outstanding financial obligations
- Distributing your assets to beneficiaries
- Managing or arranging the sale of any homes or physical property
- Properly maintaining your affairs in the manner you've set out
If you don't have an executor, your instructions will be left to the court appointee to follow.
How to choose an executor
As you start creating your will, you want to think about who is a good fit for this role. Remember, an executor is not only an important job, but it can also be long-term. In some cases, the proper execution of a will can take years. So it's key to have someone who can handle the duration of this process.
That doesn't mean you should only pick someone who has a lot of experience in this area. You can pick someone who has not been an executor but who you trust, has good common business sense, and is willing to get advice and ask for help when it comes to making the right decisions to best execute your will.
It also might be better for your needs to hire a paid executor - a person who works for a bank or trust who does not have a conflict of interest with your estate.
Important factors to consider
Below are a few more critical factors to consider as you make your choice.
- It's a good rule of thumb to avoid naming an executor who the courts will not have jurisdiction over. That would include naming a minor child or a non-American citizen who lives outside the United States.
- Some states also have specific regulations regarding out-of-state executors, so that's something else to note.
- Finally, it's never a bad idea to have a contingency plan. Sometimes, the person named as executor is unable to perform the job when the time comes. Consider naming a backup or replacement executor, or you can name joint executors who will cooperate and serve as backups to each other.
To best prepare your estate for life after you're gone, it's important to pick an executor who will keep your best interests at heart and follow the guidelines you've set out for your estate. Choosing the right executor will give you peace of mind that your final wishes are being followed as you intended for your loved ones.