A:

The executor of a will is the person designated with the task of administering the will's instructions. The responsibilities of an executor include making sure all assets are accounted for, all existing debts and tax obligations are paid, and that remaining assets are distributed to the correct parties in accordance with the deceased person's wishes. These are all important tasks and, therefore, selecting an executor is an important decision.

First of all, you should consider that selecting a beneficiary as your executor might lead to a conflict of interests because a beneficiary who is also an executor may be required to choose between awarding assets to him or herself or to another beneficiary. This situation is best avoided from the beginning by selecting an executor who is not a beneficiary.

In addition, if your assets include a business, you should be cautious about selecting an executor who is also a partner in your business. Once again, this situation can create conflicts of interest because the executor/business partner may have motivation to continue running the business, while it may be in your beneficiaries' best interest to sell it.

If your assets are primarily marketable securities, you do not need to be too concerned with your executor's business or financial knowledge. However, if you own a wide range of complex assets, you should select an individual with experience in those types of assets. If you don't have a friend or family member with the necessary expertise, consider hiring a lawyer, accountant or similar type of professional to act as your executor for a fee.

Finally, it is also a good idea to try to select someone who knows your beneficiaries and can carry on a healthy working relationship with them. To learn more, check out Choose The Right Executor.

RELATED FAQS
  1. What are the keys to setting up a trust fund?

    Setting up a trust to secure your assets for a beneficiary allows you to set the terms under which the beneficiaries are ... Read Answer >>
  2. Can an IRA beneficiary roll the IRA over into another account and designate another ...

    It depends on the provision of the IRA plan document. Some (though very few) do not allow the designation of successor beneficiaries. ... Read Answer >>
  3. If I pass away, will my retirement plan go to my spouse tax free?

    If your spouse is the designated beneficiary of your retirement plan, the assets will pass to him or her tax free. The general ... Read Answer >>
  4. How do I change my contingent beneficiary?

    Learn what life insurance companies and retirement plan accounts require from you to change your contingent beneficiary designations. Read Answer >>
  5. What are the restrictions for naming a given individual as my contingent beneficiary?

    Understand what restrictions may exist, depending on your state and the policy you choose, on naming your life insurance ... Read Answer >>
  6. What are the pros/cons of naming a trust as the beneficiary of a retirement account?

    This has been the topic of an ongoing debate in the financial community between estate planning attorneys and financial advisors. ... Read Answer >>
Related Articles
  1. Retirement

    Advanced Estate Planning: Executor Selection And Guide

    By Steven Merkel After your death, your executor or estate administrator will be responsible for following the guidelines listed in your will including conducting an inventory of your property, ...
  2. Retirement

    How To Choose The Right Executor For Your Estate

    Making a careful choice now can save your heirs from a lot of problems later.
  3. Estate Planning

    Before You Agree to Be an Executor: Know This

    How to avoid 5 surprising hazards of being the executor of an estate.
  4. Professionals

    Executor/Personal Representative

    Executor/Personal Representative
  5. Personal Finance

    4 Things To Consider Before Becoming An Estate Executor

    Executing a will takes more work than you might think. Make sure you are up to the task before agreeing to be an executor.
  6. Retirement

    Advanced Estate Planning: Setting Up Your Will

    By Steven Merkel Your will is a rulebook for the distribution of your assets upon your death. Any person of sound mind and over your state's age of majority can draft his or her own will with ...
  7. Budgeting

    The Delight Is In The Details

    Proper planning will help ensure that your wishes are honored and your heirs are well cared for.
  8. Personal Finance

    Estate Planning Goes Digital: How to Get Started

    Digital estate planning is an important part of the estate planning process given today's tech-centric world. Here's how to create this type of plan.
  9. Retirement

    6 Estate Planning Must-Haves

    You need an estate plan even if you don't have significant assets. Learn what you need to include in yours.
  10. Estate Planning

    Avoid These 4 Common Causes of Family Estate Fights

    Sibling battles over their parents' belongings are quite common. But open family discussions before the parent dies can often prevent them.
RELATED TERMS
  1. Executor

    An individual appointed to administrate the estate of a deceased ...
  2. Probate

    The legal process in which a will is reviewed to determine whether ...
  3. Blind Trust

    A trust in which the executors have full discretion over the ...
  4. Form 706: United States Estate (And Generation-Skipping Transfer) Tax Return

    A tax form distributed by the Internal Revenue Service (IRS) ...
  5. Executrix

    A female individual who is responsible for executing the provisions ...
  6. Personal Representative

    The executor or administrator for the estate of a deceased person. ...

You May Also Like

Trading Center