Picking an Executor: Four Questions to Ask

In some families, the decision of who to pick as an executor is done based on tradition or culture. The oldest child or the oldest male is automatically made the executor. But this may not be the best choice — because it can cause family resentment and the individual may not be suited to the task.

Here is an edited post from one online message board to illustrate the issue.

I come from a family of seven children. My parents have decided to name our oldest brother as the executor of their estate. We are worried about this. He gets overwhelmed easily and won’t listen to anyone. He is unreliable and alcohol clouds his thinking much of the time. We have tried to talk with our parents. We think two of our other brothers would do a better job. But my parents are “old school” and think the “man of the family” should be named. This is causing a great deal of resentment and anxiety.

To help avoid issues in your situation, here are four questions to ask when considering an executor or personal representative for your estate:

1. Is the individual responsible? An executor must be able to keep good records, meet deadlines and complete many tasks. The individual has to collect and distribute assets and pay debts. The person must understand the magnitude of the duties and be willing to take them on.

Good organizational skills are important. An individual may not be a good choice if he or she is unreliable or has trouble dealing with financial affairs.

2. Is the potential executor honest, fair and impartial? Managing an estate can lead to family conflicts. Ideally, an executor should be someone that others respect and who can handle disputes. There is a great deal of discretionary power involved in being an executor. The person must be able to administer the estate based on what is fair and reasonable for all beneficiaries — not just himself or herself.

Executors are fiduciaries, who are held to high standards under the law.

3. Does the person have a general understanding of finances and accounting principles? If you have a complex estate, your executor should have some knowledge of financial and tax matters. Of course, in most cases, the executor should enlist an estate attorney or tax adviser to assist him or her. The professional can be paid with estate assets.

Another alternative is to have a family member serve as a co-executor with a professional, such as an accountant.

4. Does the individual live close by? From a practical standpoint, it would be easier for a person who lives nearby to get to court and complete other tasks than it would be for an out-of-state resident. An executor will also be in charge of cleaning up and selling the home, if there is one. It may be a hardship for an executor who lives far away to manage the estate. Make sure the person is able to take time off from work. (For performing the necessary duties, an executor can receive a fee, which is a percentage of the estate assets. But the fee generally is not a substitute for an individual’s job.)

Some states even have requirements that executors must reside in the same state as the decedents they represent. Call the county clerk of the probate court or consult with your attorney to find out what your state allows.

Bottom line: When it comes to choosing an executor, you should make the decision based on rational factors. Use your head rather than your heart. Picking the right person(s) will help your estate settlement to run smoothly and reduce the chance of disputes.

You should also name an alternative executor in case the original executor declines the responsibility or predeceases you. If you have questions about your situation, consult with your attorney.