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How to Pick the Right Executor of Your Will

How to Pick the Right Executor of Your Will

 

How to Pick the Right Executor of Your Will

It can be scary to think about who will take care of your family and your assets after your death. That is why picking the right executor for your Will can be so important, as an estate planning lawyer Phoenix AZ trusts can attest. The executor is the person you will name in your Will to administer your estate after your death. You’ll want someone you can trust to follow out your wishes and obey the laws of your state. Here are a few things to keep in mind when picking the executor that is right for you:

 

 

 

Family

A family member, whether it be a spouse, child, or parent, is often the first and most obvious choice. These people probably know you best. They are more likely to know what sort of accounts and assets you hold. They are also more likely to know your wishes. Just be sure to take into account that person’s age and health, you want them to be alive to administer your estate upon your death.

 

Responsibility

When naming an executor, you’ll want to choose someone you know to be responsible, stable, trustworthy, and thorough. Pick someone who is timely and able to meet deadlines. This person will be responsible for handling the estate property and dealing with the court.

 

Proximity

It is often recommended that your executor live in the same state as you. Some states even prohibit residents of other states from serving as executor. So, if all your friends and family live far away, you may want to consider the next option.

 

Professional Fiduciary

Third-party institutions, like a bank, law firm, or professional fiduciary company are experts in dealing with estates. If you don’t have a relative or friend who lives in the same state, or that you feel comfortable handling your estate, then this is a good option for you. Most third-party executors will administer your estate at a fee set by the state.

 

Ask!

Before you assume that your spouse, children, or friends will serve as executor, be sure to ask for them first. You should always obtain that person’s permission. You may even want to inform them of what the job entails, and see if they feel up to the task. Make sure you notify them on the important details of your estate plan, including financial information and the location where the Will is kept. You can even provide them with a copy of the Will before your death, so that they’ll be best prepared when the day comes.

If you are interested in creating an estate plan, or have more questions about naming an executor, call an estate planning lawyer today.

Thanks to our friends and contributors from Kamper Estrada LLP for their insight into assigning and executor.

 

AVOIDING PROBATE:  IT’S NOT JUST ABOUT MONEY…

AVOIDING PROBATE: IT’S NOT JUST ABOUT MONEY…

As an estate planning attorney, a central goal that I preach is for my clients to avoid probate. Most of my clients associate probate with something akin to the plague and people like bankers, insurance agents, financial advisors, TV hosts and society at large have done a good job educating clients on the simple premise that they should avoid probate at all costs.

But why? Most people would guess the expense. That is certainly a legitimate reason. In Missouri, a probate administration can lead to costs to the court, big expenses being paid to your personal representative (also known as the executor) and, if you want the easy version of probate in Missouri, independent administration, the services of a knowledgeable and experienced probate attorney.

In a recent probate, an approximately $450,000 estate ended up costing about $1,000 in costs to the court for filing fees, inventory fees and various other expenses and approximately $31,000 in fees split equally between the personal representative and attorney .

That’s a lot of money and completely avoidable with estate planning. But to me the underrated reasons to avoid probate are:

1. Time

In Missouri, an estate cannot be closed for at least six months. Best case, therefore, you are looking at a 180 day process. In most cases, you can add at least a couple of months, if not more.  In some cases, the estate won’t be closed for at least a year, sometimes longer. So, not only have you lost a loved one, but now as a beneficiary or heir of an estate you have to wait a long time to get your inheritance!

2. Complexity

I work on probates every day and while I do a great job for my clients I have to say….I don’t like doing them.  St. Charles County has a terrific probate division but many of my probates are in St. Louis County and they are a nightmare to deal with.  Every county has a different set of procedural details that must constantly be adhered to, which is tough because those details seem to change by the month. Probates are comparable to getting your teeth pulled. The smallest details can delay them for days and even weeks.

3. Family Issues

Imagine with your family who would be more than a little bit anxious / conspiratorial about an inheritance owed to them. If someone makes out a will and then dies, unlike on TV, there is generally not a reading of the will. That is largely a Hollywood created fiction. In larger estates with a variety of distant relation family members or different beneficiaries (like people that don’t know each other), it might make sense to have a will reading. So people think that something is being hidden from them when the personal representative and the attorney for the estate don’t just cut them a check. Probates cause family tensions and in families where there is already tension, it can only aggravate things.

Conclusion

Here’s the silver lining: It is easier than ever to avoid probate with a living trust or even without a living trust under some circumstances. All you need to do first is sit down and meet with an estate planning lawyer to find out how. Heck, our office offers a free initial consultation. By the end of that meeting, you’ll know what you need and how much it costs…and how much avoiding probate will save you.

Oscar Nominated Film Highlights Guardianship Issue…

Oscar Nominated Film Highlights Guardianship Issue…

OSCAR NOMINATED FILM HIGHLIGHTS ISSUES FOR GUARDIANS AND TRUSTEES

            The movie “Manchester By the Sea” recently garnered an Oscar award for Casey Affleck, who won “Best Actor”.  In the movie, he plays a man dealing with the loss of his older brother who soon discovers he is the backup guardian and trustee for his nephew.  The guardianship in the issue mainly plays in the background but it highlights what I consider to be a common issue for people who’ve lost a loved one and are suddenly thrust into the role of taking care of legal affairs for the deceased.

The struggles of Affleck in the movie are familiar ones for people who’ve been in that position.  His character is shocked to be in charge, never actually expecting to serve as guardian and trustee.  He struggles immediately to straddle the line between the unfamiliar role of assertive father to his nephew while also trying to find middle ground between the needs of the nephew and his own life.  In particular, Affleck struggles with the prospect of relocating his life back to a place that he left for good reason, all in service of his brother’s wishes.

He struggles with the emotional details of arranging the funeral of his departed brother, including having to delay the burial because it’s the middle of winter.  He has to delay his own grieving process to assist the nephew with his.

It’s actually these struggles that make the movie so moving and well done.

I rarely find myself impressed with how Hollywood portrays legal issues on screen.  From the imaginary fiction that the death of every person require a dramatic reading of their will at a cramped law office to the ridiculously dingy and dim lighting of New York city courts in “Law and Order”, Hollywood mostly fails to find a middle ground between reality and fantasy in its portrayal of legal matters.

This movie is different in that respect.  It captures the essence of the pain of dealing with death, from the obvious standpoint of emotion but also with the pesky details that have to be covered when it happens.

In my own practice, the reality of how my clients choose people to be in charge of their estate plan often takes quite a bit of time with clients.  Part of that reality is a suggestion from me that my clients actually talk to the people that they name as guardians, powers of attorney, trustees and executors.  Seems like common sense but it’s surprising that often people don’t discuss these matters.

Is that a role the chosen person will actually fill if necessary?  Do they have a life now that would allow for time to be effective if they were suddenly the legal guardians of your children?  Are they being chosen just because they’re a relative and nearby?  Are they too old already to serve if the time to serve was a decade away?  Do your children have a close relationship with the person you chose or is it just you that is close to that person?

I will give away one secret about the movie:  Casey is a better actor than his brother.

 

 

Estate Planning For Children Struggling With Addiction…

Estate Planning For Children Struggling With Addiction…

 

 

 

ESTATE PLANNING FOR CHILDREN STRUGGLING WITH ADDICTION

                     Many parents who have children struggling with addiction or mental illness are often too consumed with caring for those children in the present to given thoughts about who and how those children will be cared for when they are gone. 

It’s a question I ask just about all of my estate planning clients who have children…do your children now or have they struggled in the past with alcohol, drugs, gambling or mental illness?  I’ll remind those clients that there is no stigma about their children’s addiction in my office.  I’m there to help and frank discussion of this issue is unavoidable for proper estate planning. 

So how might estate planning differ in this situation?

We start with a couple of baseline rules.  First, we acknowledge that an addicted child may never recover.  Second, because the child may never recover, we must ensure that the child never has easy access to funds, even if non-addicted children do have easy access. 

A special purpose trust is often the answer.  They offer traditional estate planning goals such as avoiding probate, minimizing taxes and ensuring the intended beneficiaries are named, but also can be tailored for unique family situations involving addiction.  Parents can include language that allows the trustee to deal with both the good and bad, including incentivizing the child to meet certain goals or requirements to receive a distribution from the trust.  An example would be staying sober as evidenced by a drug test or staying on a certain medication that helps the child control their addiction.

In 2017, delaying distributions of principal, as I’ve discussed in prior articles, is not always a bad thing.  As with estate planning for children who are spendthrifts, not distributing assets means they will be invested with a competent financial advisor instead, meaning the money should grow.  If the addiction problem worsens, this provides more resources to fight the addiction.  If the addiction problem recedes, the trustee has more resources to support the child and to encourage their growth through education and career changes.    

Another consideration for proper planning should be to have the child execute a healthcare power of attorney and HIPAA release after they reach 18.  These documents could allow you to help a child in crisis.  Without these documents, you have no legal authority to speak with doctors and discuss medical records and decisions.  While these documents can of course be revoked by your child, having them in place first is preferable to not having them at all. 

Estate planning for addictive children is different but much the same.  With careful consideration you can ensure that you protect your child from their addiction and from themselves. 

TERMS USED IN MISSOURI GUARDIANSHIP AND CONSERVATORSHIP

One of the things that I enjoy the most about practicing in the area of probate matters is helping families get appointed guardian and sometimes conservator for their children with special needs or an elderly parent.  It’s a rewarding process to assist a family with these types of cases and to see what a difference it makes in the person’s life.

There are a variety of terms used in the process of obtaining guardianship and conservatorship and this article covers not only the terms but their definitions*.

Here they are:

Adult – A person who has turned 18 in the state of Missouri.

Conservator – A person or corporation that has been appointed by the court to care for an have custody of the property and finances of a minor, elderly or disabled person.  This person oversees and makes decisions related to the financial affairs of the person.

Disabled Person – A person who is unable by reason of any physical or mental condition to receive and evaluate information or who lacks the ability to communicate decisions needed to manage his financial affairs and resources.  A person can also be partially disabled.

Guardian – A person appointed by the court to represent a minor or an incapacitated person.  A limited guardian is a person whose powers are limited by the court to only certain functions.

Guardian ad litem – A person appointed by the court to represent a minor, incapacitated person, a disabled person or unborn person in certain cases.  The guardian ad litem or “GAL” is appointed for a limited period of time or for a specified purpose.  In many guardian cases, the GAL is an attorney appointed by the court.

Incapacitated Person – A person who is unable by reason of any physical or mental condition to receive and evaluate information or to communicate decisions to such an extent that the person is unable to provide himself with food, clothing, shelter, safety, or other care that would prevent physical injury, illness, or disease from taking place.  This term includes partially incapacitated person.

Least Restrictive Environment – The residence of an incapacitated person which imposes on the ward only such restraints which are necessary to prevent him from injuring himself or others and which provides him with such care,  habilitation and treatment as is appropriate considering his physical and mental condition and financial means.

Manage Financial Resources – The ability to obtain, administer, dispose of real and personal property, business property, benefits, income or property; or to provide for the care and support of yourself or anyone under your care by ordinary skills and intelligence based on training and education.

Minor – Any person under the age of 18 in Missouri.

Partially Disabled Person – A person who lacks some, but not all, of the abilities necessary to manage his financial affairs.

Partially Incapacitated Person – A person who lacks some, but not all, of the abilities necessary to provide himself with food, clothing, shelter and other essential care.

Protectee – A person for whom a conservator or limited conservator has been appointed.

Respondent – A person who is alleged in a petition to be incapacitated or disabled.  The term is used in written notices of hearing of guardianship or conservatorship and during the court proceedings.

Ward – A minor or an incapacitated person for whom a guardian or limited guardian has been appointed.

*These definitions can be found in the following Missouri statutes:  RsMo. 475.010 and RsMo. 1.202.

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