When people begin to think about what they may want to do in their estate plan they often focus on how to divide their assets. Common concerns may involve how to protect assets in creating a trust. But along the way, it is easy to overlook thinking about how the estate should be managed. Choosing an executor or trustee is an important function that should not be taken lightly.
For example, business owners with several children may lean toward one child or the other to handle all of the estate and trust administration matters. Often, that can work very well. However, sibling rivalries, animosity over how an estate is handled and other dynamics should be considered to help avoid conflict and strife in the future. Some individuals may prefer not to handle the estate, which is an important concern.
Often, parents rely on the eldest child, or potentially a son or daughter with high academic achievements. These can be solid decisions, but in some environments, the better option may be to have more than one executor or trustee to manage affairs. In choosing an executor, it is important to think about what may be involved in administering the estate.
Common issues that you can evaluate in making your choice include:
The Time Commitment Associated With Estate Administration
Your chosen executor or trustee will likely work with a qualified estate planning and administration lawyer to help ensure that things are done efficiently, properly and in tune with the law. However, administering an estate does include a time commitment. Your choice needs to be available to handle matters every step of the way, and if difficulties arise, the time frame may be extended to wrap up all of the details.
Decision Making Authority And Responsibility
An executor has a duty to all beneficiaries. Making sound decisions may be necessary. Financial acuity, common sense and similar attributes are strong areas of concern in choosing a representative.
Choosing Multiple Representatives
Some parents prefer to allow several or all of their children to work together in the process. When a family business is involved, deciding who will manage the company may be an issue. A detailed plan can allow you to smoothly transfer the family business to your children, including spelling out how the company should transfer to multiple children. However, having the adult children work together during the transition may help ease tensions when the overall transition of the business is complex.
Working with a seasoned lawyer can help you to see the full issues and help to ensure that your estate plan covers all of the bases.