3 Tips for Overwhelmed Executors

While it is an honor to be named as an executor of a will or estate, it can also be a sobering and daunting responsibility. Being an executor (sometimes called a personal representative) requires a high level of organization, foresight, and attention to detail to meet responsibilities and ensure that all beneficiaries receive the assets to which they are entitled. If you’ve found yourself in the position of “overwhelmed executor,” here are some tips to lighten the load.

1.  Get professional help from an experienced attorney.

The caveat to being an executor is that once you accept the responsibility, you also accept the liability if something goes wrong. To protect yourself and make sure you’re crossing all the “i’s” and dotting all the “t’s,” hire an experienced estate planning attorney now. Having a legal professional in your corner not only helps you avoid pitfalls and blind spots, but it will also give you greater peace of mind during the process. In fact, in some states it’s a requirement that an executor be represented by competent legal counsel, so it’s always a good idea to discuss your responsibilities with an attorney before you start taking any actions.

2. Get organized.

One of the biggest reasons for feeling overwhelmed as an executor is when the details are coming at you from all directions. Proper organization helps you conquer this problem and regain control. We will advise you of what to do when, but in general, you’ll need to gather several pieces of important paperwork to get started. It’s a good idea to create a file or binder so you can keep track of the original estate planning documents, death certificates, bills, financial statements, insurance policies, and contact information of beneficiaries. Bringing all of this information to your first meeting will be a solid start.

3. Establish lines of communication.

As an executor, you are effectively a liaison between multiple parties related to the estate: namely, the courts, the creditors, the IRS, and the heirs. Create and maintain an up-to-date list of everyone’s contact information. Also, retain records such as copies of correspondence or notes about phone calls you make as executor. Open and honest communication helps keeps the process flowing smoothly and reduces the risk of disputes. It’s worth repeating because it’s so important — keep records of all communications, so you can always recall what was said to whom.

If you have been appointed as an executor, and you are feeling overwhelmed, we can provide skilled counsel and advice to help you through the process. We can also help you draft your own estate plan, so your family can avoid the stress of probate. Give our office a call today for an appointment. We look forward to hearing from you.

5 Mistakes Made by Successor Trustees (and How to Prevent Them)

5 Mistakes Made by Successor Trustees (and How to Prevent Them)

 When establishing a trust, you need to give serious thought to choosing your successor trustee—the person who will administer your trust once you’re no longer able to do so. This individual ideally should be:

 ●Someone you trust implicitly.

●Someone who is organized, responsible and meticulous.

●Someone who can remain steadfast to your wishes in the face of family disagreements and other disputes regarding the trust.

That said, even the most capable, well-intentioned successor trustees can make mistakes when managing affairs. Here are five surprisingly common mistakes along with steps to take to prevent them from happening.

1. Faulty Record-keeping

To ensure that a trust fulfills its purpose without being contested, the trustee must keep accurate, detailed records of income and distributions. Your trustee must also be prepared to report these figures regularly to the beneficiaries and heirs. If these records are incomplete or inaccurate, the door is opened for someone to challenge the trust, potentially leading to lengthy and costly court battles.

To prevent this mistake: Hire an accountant to assist the successor trustee in record-keeping, and make sure the trustee and the accountant make a connection before the trustee takes over.

2. Misunderstanding the Fiduciary Role

Many trustees mistakenly assume their job involves acting in the best interests of the person setting up the trust. In reality, their job is to act in the interests of the beneficiaries of the trust. Furthermore, the trustee may be legally liable for any failure to protect the beneficiaries against bad investment advice concerning the trust.

To prevent this mistake: Detail the fiduciary role of the successor trustee in the trust documentation itself, and be certain that the trustee understands his/her role.

3. Not Collaborating Effectively with Your Established Financial Team

The successor trustee’s failure to communicate with key members of your team while administering your trust can lead to inaccuracies, misunderstandings and significant, preventable financial losses.

To prevent this mistake: Make sure your trustee is properly introduced to, and connected with, your attorney, CPA, financial planner and anyone else involved with your estate planning.

4. Failing to Discuss Compensation

If your appointed trustee is a close friend or family member, the topic of compensating the trustee may be glossed over or forgotten. This oversight can result in a lack of morale or even resentment if managing the trust becomes difficult or time consuming.

To prevent this mistake: Bring up the topic of compensation yourself when you establish the arrangement; be as generous as you deem necessary; and put the compensation terms in writing.

5. Failing to Remain Objective

Many people choose a close family member as a trustee. This strategy can be appropriate, especially when privacy matters. However, disputes about money can happen even in the tightest-knit families, and it can be difficult to near-impossible for a relative to remain neutral when resolving those fights. The end result could be decisions that family members perceive to be unfair or that wind up being inconsistent with your intentions.

To prevent this mistake: Make certain the person you choose can remain neutral and faithful to the terms of the trust, even under duress. If there is any doubt, consider hiring a corporate trustee with no emotional connection to the family or estate.

Selecting a successor trustee is one of the most important decisions you will make during your estate planning process. For insightful counsel on this issue, contact us today to schedule a private appointment.