Friday, August 5, 2016

When to Use (or Not Use) Your Immediate Family as Executor or Trustee in Your Estate Plan


Summary: Estate plans involve many important decisions. One of these critical choices is selecting the person or people who will manage your estate and your trust after you die. While selecting a close loved one to carry out these tasks can work in a lot of circumstances, some situations may dictate that choosing a person who is less close makes more sense. Choosing the right person or people can help ensure that your plan's assets are distributed efficiently and according to your wishes.   

For many people, the most important estate planning decisions they will make are deciding who will receive their assets after they die, and who will manage those affairs when that time comes. Deciding on the person or people you want to serve as the executor of your estate and the successor trustee of your trust can be vary based upon the specific circumstances of your wealth and your family. Regardless of your situation, these are very important decision that you should approach with considerable care. 

For some people, selecting an executor and a successor trustee can be fairly simple, as they prefer that their closest relatives handle these roles. Choosing an immediate family member, even if that relative is a beneficiary in your estate plan, can be a wise selection in many cases.  Often times, your relative is entirely capable of handle these tasks, and can be fully counted on to perform the duties of an executor or trustee in the way that you want. In these circumstances, using a family member or other loved one can offer financial advantages over selecting an outside professional.

In other cases, though, using a loved one to serve as your executor or your successor trustee can be a risky choice. If your estate plan is highly complex, you might not want to select a loved one who would not be able to manage the complicated nature of your plan. Even if your plan is not especially complicated, you might want to avoid selecting a loved one who is poor when it comes to managing or distributing wealth.

Additionally, if your estate plan calls for one or more beneficiaries to receive their distributions stretched out over a long period of time, you might want to avoid choosing a loved one (or, if you do, make sure you have several alternate successor trustees or executors to reduce to risk of your plan's distribution scheme outliving your trustee.)    

You may also want to contemplate your "family politics" in making your best choice. If the distrbutions you've created in your plan are likely to cause conflict between family members, you may want to take care to ensure that your trustee or executor is an impartial party. For example, if your plan calls for your daughter to receive a large distribution and for your son to receive very little or nothing, selecting your daughter as a trustee or executor could heighten the strife between siblings and perhaps even increase the risk of a legal challenge to your plan.     

This article is published by the Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services-company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at www.legacyassuranceplan.com

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