Executors and trustees play important roles in estate planning, but their responsibilities differ significantly.
Understanding their responsibilities will help you know how to select the right people for the positions.
Responsibilities of executors and trustees
An executor manages the probate process, following the deceased person’s wishes according to their will. They handle tasks like collecting all of the deceased’s assets, paying debts and taxes and distributing the remaining assets as the will directs. They must also handle any legal filings required for the estate and meet all financial obligations before closing the estate.
Trustees manage trusts set up by the estate, which involves investing and distributing assets according to the trust’s terms. They may continue to do so for years or even decades. They must act in the best interest of the beneficiaries and adhere strictly to the trust’s instructions, which may include controlling how assets are distributed to beneficiaries over time.
Choosing the right people
It is important to select the right executor or trustee for your estate plan. You should choose individuals who are responsible, trustworthy and organized. They should also be capable of handling financial matters and understand the legal obligations their roles require.
For executors, it’s often wise to choose someone who is both familiar with your family dynamics and somewhat detached from them. This can help in executing your will impartially and effectively.
For trustees, consider their ability to manage complex financial issues over long periods, especially if the trust involves significant assets or complicated directives.
Legal and personal considerations
It’s important for both executors and trustees to have a clear understanding of their roles and the legal responsibilities involved. They may also need to work with attorneys, accountants and others to manage and fulfill their duties properly.
Executors and trustees hold key responsibilities in managing and executing estate plans. Consider the qualifications and characteristics of potential candidates carefully to ensure that the estate or trust operates smoothly and according to the deceased’s wishes.