Before you say “I do” to being an Executor of an Estate
You certainly want to help your friend or relative if they ask you to be the executor of their estate but what, exactly, are they asking you to do?
Its important to know the scope of the task that you would be taking on, and it is clearly not for the faint of heart. The executor has to find the deceased’s relevant documents, inventory his or her assets and debts, and arrange appraisals for the tangible assets that the deceased may have owned. That is in addition to communicating with financial institutions and governmental agencies, managing property and keeping careful records of everything. If the estate includes a home, the house may have to be emptied of possessions and readied for sale.
Individually, these activities may not seem intimidating, but they add up. A survey by EstateExec, an online tool for executors, found that the typical estate takes about 16 months to settle, and requires 570 hours of effort. Estates worth $5 million or more typically take 42 months to settle and 1,167 hours to complete. Some of those hours will be hired out to professionals—attorneys, a CPA and a wealth advisory firm—but the executor has to watch over and coordinate everyone’s efforts.
Disputes are not uncommon. You may find yourself in the role of referee when the heirs disagree about the way the assets were divided, and they may disagree with some of your judgment calls, such as whether to spend the estate’s money to fix up a house for sale.
Before you accept the role of executor, you might insist on seeing the will or trust documents to ensure that there aren’t any unpleasant surprises that could cause discord among the heirs, and ensure that everything is inventoried and the assets are in good order. You can also insist that the documents name alternates in case you can’t or decide you really don’t want to serve in this complicated role.
*See Sam G Huszczo, CFA, CFP in the Detroit Free Press on Quicken Loans becoming the next GameStop in the 1st article below: