What does an executor do?
The first responsibility is to tend to funeral arrangements and then to gather up all the information relevant to the Estate. This information includes the ownership and value of assets, as well as the nature of all Estate liabilities. These responsibilities need to be taken seriously.
Some other duties include: make provisions for dependants; notify various government agencies of the deceased's death; collect income from assets; decide about investments; seek advice as required. The executor’s role is similar to that of a trustee: both owe a duty to the beneficiaries.
When one plans his or her Estate and prepares a Will, it is useful to consider the attributes of a successful executor. Some questions might be:
- Is the person organized?
- Does the person have financial skills?
- What is the demeanour of the person who is being considered as an executor?
A recent British article asks more questions. One point, among many, is that “Honesty and conscientiousness are important, but if you are appointing more than one executor - and often that's a good idea - they also need to be team players.”
Each situation is different but the hard and soft skills of a potential executor are likely useful considerations.
Examples abound to illustrate what might go awry. Take the Estate of the renowned violinist, Isaac Stern. In 2004, the beneficiaries of the Estate were disappointed when the executor failed to include the value of the deceased's New York apartment in the calculation of the Estate's value. This decision resulted in a shortfall of funds to meet the Estate’s liabilities. Legacy items, including musical instruments, were apparently sold at auction to the beneficiaries' collective dismay.
Choose your executor(s) wisely.
Enjoy your Thursday.