One or Two? Choosing the Right Executor or Trustee

Creating an estate plan involves deciding who will carry out your wishes. Whether you have a will, a trust or both, choosing the right executor or trustee is an important part of the process.

If you have several trusted people in mind, you may wonder whether to name one person with alternates or appoint multiple people to serve together as co-executors or co-trustees. While sharing responsibility may seem appealing, it can also introduce complications.

What Do Executors and Trustees Do?

An executor (also known as an administrator or personal representative) administers an estate after someone dies. Responsibilities generally include managing assets, paying debts and expenses, filing required tax returns and distributing property according to the will.

A trustee manages assets held in a trust according to its terms and applicable law. This includes overseeing investments, maintaining records, acting in beneficiaries’ best interests and making distributions as directed by the trust agreement.

Both roles require time, organization and sound judgment, making the selection an important estate planning decision.

The Pros and Cons of Co-Fiduciaries 

Appointing co-executors or co-trustees can help distribute responsibilities, provide additional oversight and give multiple family members a role in administering an estate.

However, the arrangement can also create challenges. Fiduciaries may disagree about investments, asset sales or distributions. Coordinating signatures, paperwork and schedules can delay administration, while conflicting opinions may create tension among family members.

Before appointing multiple fiduciaries, consider whether they can work together effectively and whether the benefits outweigh the potential complications.

Alternatives to Consider

You can build flexibility into your estate plan without requiring multiple people to serve at the same time. Options include:

• Naming successor fiduciaries: Designate alternates in a preferred order so someone can step in if your first choice is unable to serve.
• Working with professionals: Attorneys and accountants can help with estate administration, tax filings and other specialized responsibilities.
• Appointing a corporate trustee: A bank or trust company may provide professional trust management, although fees and minimum asset requirements may apply.
• Planning for future independence: Certain trusts can include provisions for beneficiaries to assume greater management responsibilities as they mature.

 

Choose the Right Approach for Your Estate

There is no single solution that works for everyone. A sole fiduciary with designated successors may simplify administration, while co-fiduciaries may be appropriate in certain circumstances.

The important thing is to choose an arrangement that reflects your wishes and helps minimize unnecessary complications for your loved ones.

Martin Pringle’s estate planning attorneys can help you evaluate your options and select an approach suited to your circumstances. Contact a Martin Pringle estate planning attorney to discuss your goals and create a plan for the future.