How to Choose an Executor and Trustee for Your New Jersey Will
Your will is much more than just an estate planning document that identifies which heirs get what percentage of your estate when you die. A well-written Will also specifies when your heirs are to receive their inheritance and if protective trusts are to be set up for their benefit. Your Last Will prioritizes the payment of debts and taxes, who is to take over and operate any businesses you may own, as well as many other aspects of your worldly affairs. Therefore, the choice of an executor and/or trustee under your Last Will is a very important decision in your planning process.
RESPONSIBILITIES OF AN EXECUTOR UNDER A LAST WILL
Most people pick a close family member because they know them best. Most times naming a spouse, significant other, or adult child to be your estate executor is often the most logical choice. But before you do, it’s smart to consider whether they’re really the best choice for the job. Why, you may ask? Well, to start they may not be interested in the job. Before you choose someone, if they seem hesitant, may be reluctant, or disinterested, it can mean they have no interest in being an executor and would prefer you name someone else. If that’s the case, may I encourage you to have a discussion (heart to heart) with them?
Maybe they are too busy. Settling an estate can take months or a year(s). Responsibilities include locating the whereabouts of investments, closing bank and investment accounts, selling off stocks and property, cleaning out a home, visiting the probate court, and distributing assets to the beneficiaries named in the will. There will be telephone calls and visits to an estate attorney, financial planner, realtor, and possibly an accountant and other professionals. Your executor might even end up having to keep the peace among family members. If someone has a young family with children, a high-stress career, or always seems to take on more than they probably should, being an executor might be too much for him or her, especially if you die in the foreseeable future.
Despite your best efforts to pick the right executor, it is possible your executor will have to make decisions or interpret your wishes because they aren’t completely clear or written down in your Last Will. If you fear they won’t make decisions in keeping with your beliefs, morals, faith, goals, etc., PICK SOMEONE ELSE!!!
If the proposed representative doesn’t get along with other members of your family, this is a big red flag. Conflicts between personalities and relationships generally results in some type of litigation. After a death, grief, guilt and sadness can resurrect unresolved family issues. Even previously healthy family relationships fall apart especially when money is involved. If there’s already bad blood between the proposed executor (i.e. second spouse and biological children of an earlier marriage) and your loved ones, you’re setting your family up for more turmoil after you’re gone.
If your potential executor isn’t good at organizing themselves and executing assignments, you should definitely not name him or her to this role. Staying on top of things is critical and disorganization leads to big mistakes, including things such as selling investments at the wrong time, allowing your home to fall into despair, failing to make the legal notifications, neglecting tax payments, etc. Your executor may need to be committed for the long haul and have the organizational skills to perform.
Honesty and integrity are a must. N.J. is a probate friendly state and judicial involvement is minimal. And frankly, a court can’t oversee every one of the many steps in the probate process. Stealing aside, if your executor lies about completing a task, etc., it also can cause significant problems and end up costing your beneficiaries a lot of money and stress.
Understanding the Role and Qualifications of the Executor
A will must name an executor of legal age and capacity. Capacity refers generally to the executor being of sound mind and the legal age is at least 18.
The executor receives temporary legal custody and control of estate property and is responsible for administering the terms of the will for the benefit of the beneficiaries of the will. Your will should identify who the executor is and provide for a successor executor(s) in case the primary executor is unable to serve. Your will can specifically provide a mechanism for selection or replacement of an executor.
A will may have more than one executor. Where there is more than one executor (called co-executors), the will can specify whether a majority or all of the trustees must agree on decisions to be made.
There are two general types of executors: individual executors and corporate executors. A combination of an individual and a corporate investment executor can be used but should be carefully considered.
Corporate executors include brokerage firms, trust companies and banks and other financial institutions with trust services. Corporate executors are usually chosen for their expertise with estate administration and because a corporate executor will (hopefully) always be there. Corporate executors charge for their services, often based upon the amount of estate assets.
The attorneys with Fredrick P. Niemann, Esq. have prepared countless Last Wills, Trusts, and numerous other estate/family and business planning documents for individuals and families like yours for over 40 years. We can help you evaluate who might be the best person to serve as your executor.
When choosing a person to be the executor or trustee under your will, you need to answer this question:
- Who could step into my place and confidently act as I would in carrying out my wishes? In other words, who do I trust the most to make the decisions I would have made if I were alive to make them?
It is vitally important to choose someone that you have full faith and confidence in. You should feel at ease that he or she will carry out your instructions as they are written in your trust and estate planning documents. Some typical choices include a:
- Close family friend
- Close family member
- Child
- Professional trustee
While you may feel completely secure in trusting this huge responsibility for carrying out your wishes to a family member, there are several situations when that is not wise or possible. In that case, your estate planning wishes can be addressed by a trusted outsider.
What to Do If I Have No One to Serve as Executor
If you do not have a close friend or relative you feel comfortable leaving this job to, or if selecting one of the heirs will cause conflict with others, then there are other options. You can hire an outside executor and trustee like:
- Your bank’s trust department
- A trust company
- Your lawyer
- A financial advisor
- A professional trustee/executor
These professionals are well versed in what it requires to be an executor and trustee and can often work more expediently and effectively, which saves the heirs money and time. While there are many benefits to not having a family member involved as the trustee of your testamentary trust; there are also some drawbacks to using a bank or trust company as your trustee.
Banks and professional trustees charge fees for their services as trustee with a minimal estate value of not less than around one million dollars ($1,000,000).
Fredrick P. Niemann Esq.
No matter whom you choose, you want to be sure that you have full confidence in them to do exactly as you want, no matter what other people say. There may be heirs who are unhappy with the terms and conditions of the will and will try to sway your representative to do what they want. Knowing that you have a strong, trustworthy individual protecting your wishes may provide you with peace of mind.
If you have any questions or would like to meet to discuss how best to choose an executor and trustee for your last will and/or trust, contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or fniemann@hnlawfirm.com. He is happy to answer your inquiries. You’ll find him easy to talk to and eager to find solutions for your particular concern(s) or legal matter.
Written by Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a New Jersey Last Wills Attorney
NJ Wills Attorney Serving These New Jersey Counties:
Monmouth County, Ocean County, Essex County, Cape May County, Mercer County, Middlesex County,
Bergen County, Morris County, Burlington County, Union County, Somerset County, Hudson County, Passaic County