Asked to be Estate Executor? Here’s What You Need to Know.

Being named the executor of someone’s estate is both an honor and a significant responsibility. While it’s an opportunity to ensure a loved one’s wishes are fulfilled, it also brings its share of challenges. Whether you’ve already been named an executor or are considering accepting the job, understanding what’s involved is crucial in determining if the role is right for you.

What Is an Executor?

An executor is a personal representative legally tasked with carrying out the instructions in a will after someone passes away. Usually one of the will’s beneficiaries, executors can be a close family member, such as a surviving spouse, an adult child, or even a trusted friend. However, a professional like an attorney or financial institution can also serve in this role. Whoever is appointed, the executor is responsible for managing the estate and ensuring debts are paid, taxes are filed, and the remaining assets are distributed to beneficiaries according to the decedent’s wishes.

Key Responsibilities of an Executor

Serving as an executor can be time-consuming, sometimes taking months or even years to complete the estate administration. Here are some of the key tasks you’ll be responsible for during the process:

Gathering and Valuing Assets

As executor, you’re responsible for gathering key financial documents like titles, deeds, and financial statements. You’ll also be in charge of locating and inventorying all estate assets, from bank accounts and investments to real estate and personal property — some of which may need to be appraised or sold.

Paying Debts and Taxes

One of your key responsibilities is to settle any outstanding debts, such as loans, credit cards, or medical bills. Additionally, you’ll need to file the deceased person’s final income tax returns and ensure any estate taxes are taken care of.

Distributing Assets

Once the debts and taxes are paid, the remaining assets are distributed to the beneficiaries listed in the will. While this part can be rewarding, it requires careful management, especially if it involves handling funds for minors or resolving potential family disagreements.

Managing Legal and Financial Documentation

Executors must keep detailed records of all transactions involving the estate. You’ll also need to file legal documents with the probate court and, in some cases, work with professionals like attorneys or accountants during the estate’s administration.

Pros and Cons of Being an Executor

Being an executor is an important responsibility, but it can be challenging. Here’s a look at the pros and cons of accepting the role.

Pros:

A meaningful role: Acting as an executor is often considered an honor. It’s a way to ensure your loved one’s wishes are respected and carried out with care.

Compensation: In many cases, executors get paid according to the time and effort spent, as well as any state laws and terms outlined in the will.

Learning experience: Managing an estate can provide valuable experience in handling legal and financial matters, which can be useful in your own life.

Cons:

Time-intensive: Managing an estate can take a significant amount of time, especially if there are multiple beneficiaries or complex assets like properties or businesses.

Emotional toll: Being an executor, especially for a close loved one, can be emotionally draining. It may also involve managing family tensions or disagreements over assets.

Legal responsibility: As an executor, you’re legally required to act in the best interests of the estate and its beneficiaries. Mistakes, such as mishandling assets, could result in legal consequences.

What If You Can’t  — or Don’t Want to — Serve as Executor?

If you’ve been named as an executor but feel that the responsibilities are too much for you, there are ways to step back or seek help.

Declining the Role

If you haven’t started the process, communicate with the person who appointed you as early as possible so they have time to select a new executor. If the testator has already passed away, you’ll need to decline the role by submitting a formal written statement to the probate court. From there, the court will appoint an alternate executor, often someone named in the will, or an administrator if no one else is designated.

Stepping Down After Starting

If you’ve already begun acting as the executor but find it’s more than you can handle, you can petition the court. This process involves filing a formal request with the probate court, explaining why you cannot continue in the role. The court will then appoint a new executor.

Whether you’re declining or resigning, it’s important to remember that stepping away can sometimes lead to disappointment or friction among beneficiaries or family members. To help smooth the transition, communicate openly with the family and ensure that you handle the resignation process as efficiently as possible.

Working with Professionals

If you want to stay in the role but need support, you can enlist professionals like attorneys, accountants, or financial advisors to help. They can take on some of the heavy lifting, like managing paperwork or handling complex financial transactions, while you retain your legal responsibility as executor.

Hiring a Professional Executor

If you’re sure you don’t want the role, hiring a professional executor is another option. Professional executors, such as trust companies or lawyers, handle the administration and probate process for you. Though they charge fees, usually based on the estate’s value, they can ensure everything is managed correctly, efficiently, and impartially.

We’re Here to Help

Want to learn more about how taking on the role of executor could impact you and your financial plan? Our team is here to offer expert insight and help you make the best decisions for your needs. Contact us today for a complimentary consultation and let us help you feel confident about your financial future.