What Should You Consider If Someone Asks You to be Their Executor or Trustee?

Tuesday, July 15, 2014 | 7:38 pm

One of the toughest decisions a person makes when creating an estate plan is selecting who will act for them when they are unable—either because they are incapacitated or when they pass away. In the context of a will, this person is called an executor and if there is a trust, this person is a trustee. While the roles of executor and trustee are different from a legal perspective, they require the same qualifications and responsibilities, so for the purposes of this article we will use the terms interchangeably. Before you agree to act as an executor or trustee, you should be aware of the responsibilities. And if you decide not to accept, is there a tactful way to decline?

If you are asked to be the executor of an estate, the first thing you want to do is understand what the job entails. Being an executor or a trustee is a big responsibility, and depending on the situation, it can be a full-time job. The most important quality for a good executor is trustworthiness. An executor does not have to be a family member, but it may be helpful if she is familiar with the family. A trustee must respectfully abide by the terms of the will or trust and not take advantage of the power bestowed upon him. With those characteristics in mind, here’s a list of “job” qualifications to consider if you are suited to be an estate executor:

• Detail-oriented: The trustee acts as a fiduciary to the beneficiaries of the trust. That means that the trustee has to act with the utmost care to ensure that trust and estate assets are accounted for, productive and distributed properly and in accordance with the law.

• Financially Savvy: Often times the bulk of the executor’s responsibility relates to accounting and finances. If you balance your checkbook, and responsibly handle your own bills and financial accounts, then you’ve got an advantage. But keep in mind, if these are not your strengths, an executor is permitted to hire professionals (an accountant or bookkeeper) to assist with the estate administration.

• Diplomatic: Step back and analyze the family dynamics. Ask yourself if your role as trustee will facilitate the distribution of the estate or if it will complicate the situation. Can you be impartial during disagreements and mediate conflicts?

• Longevity: Your role as executor may not become active until 10-20 years down the line. Will your future plans and lifestyle allow for you to competently serve in the role down the road?

If you decide that you can handle the job of trustee, the settlor should communicate with you where they keep all of their important documents and the telephone numbers for their attorney and accountant. Details of accounts and balances are not important at this time, but you should just know where to go to get the information when you need it. You also should have a serious conversation about how the settlors desires and expectations about their estate so you can carry out their wishes.

On the other hand, if being an executor is not the right fit for you, it is perfectly okay to decline. The best approach to declining is to be honest. Let the testator know that you are honored to be considered for the role; however…and explain exactly why you feel you are not suited. Perhaps you cannot be objective given the circumstances or you don’t feel comfortable handling the finances.

If there is no one else they feel comfortable asking to be trustee, you could suggest that they hire a licensed private fiduciary. The benefit of hiring a fiduciary is he or she is licensed and bonded by the State of California, and is trained to handle estates, trusts and conservatorships. It is a fiduciary’s full-time job to handle moderate to complex estate plans, and appointing one eliminates the responsibility of being an executor on a family member or close friend. It’s best to select a fiduciary affiliated with the Professional Fiduciary Association of California (PFAC), who has fulfilled education and experience requirements.

The key to success in situations like these is transparency. Putting all the cards on the table and being upfront about the decision gives the testator an opportunity to create an estate plan that will benefit all in the end.

Alexandra Smyser is an estate planning attorney with the Law Offices of Donald P. Schweitzer located at 201 South Lake Ave. For more information, call (626) 683-8113 or visit http://www.pasadenalawoffice.com.

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