Although planning your will can be an unpleasant idea, it is the only way to protect your loved ones and ensure that your wishes are carried out. Choosing an executor is a very important component of planning your will. The executor (or executors) will be responsible for all the financial arrangements and notifications. It is important that who you choose is aware of what exactly is entailed with this job, and that everyone is comfortable with this decision.
So, who should you choose? You can choose more than one person. You may decide to choose a close friend or relative that you trust, as well as someone who is experienced in financial matters. This can be a wise choice if you have a complex estate that will require the time and effort of more than one person. However, make sure that the co-executors will be able to work together effectively. You can also opt for a family member or friend that you trust to work with a professional in the finance industry who will be paid a set fee for their service.
It is important to choose someone who has the time to devote to administering your estate. There are many responsibilities that your executor must take on, and be able to do during business hours. This includes such tasks as meeting with your lawyer, your insurance agent and/or financial advisor. For someone who works fulltime and/or has a lot of commitments, this may be an imposition to them.
The person(s) you choose should have a high probability of surviving you. It’s a good idea to revisit this idea every few years; circumstances very often change. For instance, you may have chosen someone who 3 or 4 years later has serious health concerns, has started raising a family, etc. and can no longer devote the necessary time. If choosing a financial advisor/consultant as one of the co-executors, it is important that the specific person or business is still practicing and available.
What does the Executor of a Will Do?
The person(s) you choose must be aware of exactly what is entailed in being the executor(s). Problems can arise if the person(s) you have chosen is not aware of the duties and responsibilities that are involved. Before accepting the role of executor, they must be willing and able to:
- Obtain the death certificate and be able to participate in or fully arrange the funeral. If you have specific requests about the service you would like, they need to be aware of these arrangements.
- Find and review your will. This may entail meeting with a lawyer who can apply for probate.
- Inform the beneficiaries that they have been included, as well as updating them on the progress of the probate. This can be a big job depending on the size of your estate and the number of people you have included in your will.
- Notify all businesses and institutions of your passing. Banks, credit card companies, insurance companies, landlords, etc. must be notified as soon as possible. Items such as the phone company, internet, etc. must be notified and any pre-authorized payments stopped.
- Apply for all life insurance benefits as well as any Canada Pension Plan death benefit if this is applicable.
- Compile a list of the estate’s assets. This is one of the most time consuming parts of being an executor. This list must include every bank account, investment, pension, registered plan, property and anything and everything else of value that you own. Each asset must be located, secured and valued. Detailed records must be kept of any transactions made on behalf of the estate for the courts and beneficiaries.
- Paying the estate’s debts, expenses, and taxes. All debts that are owed must be paid, including funeral expenses and the final tax return.
- Administer any trusts set up in the will. The executor will be responsible for this task for as long as the trust is in existence.
- Distribution of bequests, including any personal items (family heirlooms, etc) as well as property, stocks and bonds.
As you can see, the role of executor is complex and time consuming. Depending on the size and complexity of your estate, it can take months (sometimes years) before all issues are settled. If you choose a financial professional as executor or co-executor, they will specify the amount they need to get paid for their services. With friends and family members however, issues can arise revolving payment for their time. Specify an exact amount in your will that will sufficiently compensate them for their time and efforts. It is important to state the amount so there will not be any disagreements among the family and/or beneficiaries.
Once you have selected your executor(s), make sure that you have all your required documents together i.e. bank account numbers, insurance policies, deeds, and any other financial documents, as well as your current will. You also have to make it known where these documents are stored (lawyer’s office is usually advisable). Include in this a current list of all beneficiaries’ addresses, phone numbers and email addresses. You can also compile a separate list of the information that will be needed such as:
- The provincial location for your Canadian Pension Plan
- Revenue Canada (for taxation information)
- Your banking representative
- Insurance broker
- Service providers (phone company etc)
- Charities that you have specified in your will
Remember that the more organized your will and documents are, the less stress will be incurred by your family and friends. Make people aware of your intentions to avoid confusion later on. Consult with a lawyer and/or financial advisor about your wishes, and the correct way to construct your will. Also consult with your life insurance representative to make sure that your coverage is sufficient to carry out your plans.
Conclusion
We hope you found this article about choosing an executor of a last will and testament useful.
If you have any questions about how insurance can play a role in your financial well-being please feel free to contact us, as licensed, experience Canadian insurance brokers we are here to help!
