- One common trouble many executors overlook: dispersing personal possessions that have little financial value but great sentimental value.
- If the testator keeps electronic track of the estate annually, the executor will have a good snapshot of assets when it's needed.
- An executor should have a record of the testator's online presence to deactivate accounts.
1. Know the Location of the Will and Other Documents
This is an obvious and vital first step. The executor's job is easier if the testator keeps the original will, deeds, partnership documents, insurance policies, or other important papers in an agreed-upon location (whether in the home or in a safe deposit box) and keeps copies at a backup location. The copies can be held directly by the executor or by the testator's lawyer.
Remember that access to a safe deposit box could be restricted at the death of the testator. It is helpful if more than one person has been registered as having access to the box, such as a spouse.
2. Make Property and Accounts Joint, Where Appropriate
If the testator has a spouse, they would likely prefer that assets flow immediately through to the widow or widower if possible. The simplest way to ensure this: Set all accounts as joint, and make sure that properties and titles are in both names (which also works for business enterprises involving a partner). This has the added benefit of reducing the size of the estate, as long as both parties do not die simultaneously.
The executor should also have the testator confirm that the correct beneficiary is named for accounts that demand a specification such as pensions, retirement accounts, insurance policies, and so on. If the testator has gone through a divorce, remarried, outlived a child, or experienced some similarly significant event, the list of beneficiaries will likely need updating.
3. Record the Testator's Preferences
Does the testator want a large wake or a small cremation ceremony? Are there charities he or she wants to support after all the beneficiaries die? These preferences need to be in writing and signed by the testator.
4. Create a Possessions List and Assign Recipients
One common trouble many executors overlook: dispersing personal possessions that have little financial value but great sentimental value. Working with the testator, an executor can create a rough draft of a list for dispersal of personal items, as well as a system of distribution. Also, have the testator write their reasoning for who got what gift. Sharing the list with those involved may eliminate problems.
The executor should have the testator confirm that the correct beneficiary is named for such accounts as pensions, retirement accounts, and insurance policies.
The main benefit of working from this list is that the executor can track gifts given prior to the death of the testator, as many people begin dispersing personal items as they age. High-net-worth people also frequently give financial gifts prior to death. Organized dispersal can make an executor's job easier and help balance issues of fairness.
5. Set Up a Yearly Accounting Sheet and Updating Schedule
Computers have made it much easier to track changes in accounts and possessions. If the testator keeps electronic track of the estate annually, the executor will have a good snapshot of assets when it's needed. This e-document will also cut the time spent looking for that gold watch the testator gave to a grandchild or tracking funds that were supposedly in a now-empty investment account.
6. Have a Sealed Online Accounts Document
In the digital age, an executor should also have a record of the testator's online presence (Facebook, Paypal, eBay, and so on) to deactivate accounts. The same ends can be met through presenting a death certificate to many of the above or similar sites, but the document simplifies work for the executor.
7. Know the Relevant Professionals
Executors should be familiar with the accountant, lawyer, and other professionals the testator employs. They may have further advice specific to the testator's situation, such as diverse partnerships, complicated ownership of property, and so forth).
The Bottom Line
Preparation will greatly reduce the complications of being an executor. Taking the steps above while the testator is still alive will also help make sure that the executor carries out the testator's wishes. Testators can also be proactive about setting up such processes to make their executor's job easier.