Finance Q&A's
Executors and their roles
Appointing an executor of a will requires great consideration to ensure the person has the knowledge and ability to handle the legal responsibilities that come with the role. Lakeside Practice Principal Matthew Hibbert outlines the main duties of an executor and advises on how to select someone competent of such tasks.
What is an executor of a will?
M: The executor of a will is the person (or people) appointed by someone to deal with their estate and ensure the wishes in their will are carried out following their death.
You appoint an executor at the time of making a will and can change them at a later date if you change your mind for any reason.
What are the main duties of an executor?
M: There are many legal responsibilities associated with being an executor, including potentially: registering the death, arranging the funeral, valuing the estate, paying any inheritance tax, applying for probate, sorting the deceased’s finances, placing a deceased estates notice, distributing the estate and keeping estate accounts.
How should you go about choosing an executor?
M: Being an executor comes with a lot of work and legal responsibilities, so it’s important to select the right person (or people) for the role. If an executor is found to have not followed the terms of the will, they would be liable. Some people think it’s logical to have their children or parents as executors, but it’s important to consider if they will have the knowledge and ability to manage the tasks at their age, and also due to their emotional state following your death. As such, we advise choosing someone who is a similar age to you and in a similar position to you, such as a friend or close colleague. They’ll likely have experience dealing with finances and selling a property, so the tasks won’t seem as daunting. If in a couple, partners generally choose each other as executors, should just one of them die.
The main thing to keep in mind is that if your executors feel out of their depth when it comes to a certain area of their role, they can always pay a professional for help. However, the more capable your executor is - the less help they will need, and the less your estate is likely to be eroded due to professional fees. So by picking a more suitable executor, you actually increase the amount your beneficiaries are likely to receive.
And how many executors should you have?
M: You can have up to four executors though the more executors, the more people involved, which can complicate things and slow down the process. We usually advise having two executors so that if one person dies, there is still a second in place. As a second executor, you might like to pick someone emotionally close to you, such as your son or daughter. Alternatively, you could choose a professional executor who you pay to do the work.
What is the difference between an executor and a trustee?
M: In short, an executor is an administration role, whereas a trustee has the role of looking after the money until it can be distributed to the beneficiaries named in the will. In the vast majority of cases, executors also act as trustees by default due to the timeframes in sorting the deceased’s estate. For example, administrative issues could mean it takes nine months from the sale of the deceased’s property to get the money to the beneficiary, during which time the executor/trustee is responsible for looking after that money. Alternatively, it might be that younger beneficiaries aren’t allowed to access their inheritance until a certain age, and so in the meantime, the executor/trustee will look after it.
You may also be interested in our Make A Will, Make A Choice Q&A, which can be viewed here.
Please feel free to contact us for further information: admin@lakesidefs.co.uk