For many people, serving as the executor of an estate or as trustee of a trust can be a dubious honor. On the one hand, it’s a clear sign that someone trusted you, respected your ability to follow directions and make decisions and believed that you would follow his or her last wishes.
However, there is a lot of pressure and work involved with the process of estate administration. When you accept the role, you should begin planning how you will handle these critical responsibilities.
Fulfilling your duties carefully is important to honor the memory of the deceased. It is also important to avoid having the estate or trust dragged into court by an heir who is unhappy with your efforts.
How to avoid making major mistakes with the estate
It may seem like common sense, but there are many issues that arise during estate administration that you can probably avoid with a little forethought. If you are unclear about the intention of the will in some areas, talk with an experienced attorney or the lawyer who helped draft the estate plan, trust or will.
Don’t let the heirs pressure you into making mistakes, either. For example, while heirs may be enthusiastic about receiving certain assets, perhaps while in town for the funeral service, you should take care not to disperse anything too quickly.
You need to carefully review the financial records, pay any and all creditors and taxes, and ensure that any assets due to the spouse get handled before anyone else receives anything from the estate. When you complete your duties to the estate, you should also make a point of closing the estate officially, as failing to do so could have financial, tax or legal implications in the future.
Make sure you are diligent with keeping records
When you do begin disbursing assets to family members, friends, charities and others named in the will, ensure that you document everything. From the final electric bill due on the home to the fair market value on real estate you must list for sale for the financial benefit of heirs, write it down. You need a paper trail for everything you disperse and each financial decision you make. This protects you from claims of embezzlement, theft or improper administration of the estate.
You also want to clearly communicate with family members and other people close to the deceased. If people know what to expect from the process, they are less likely to drag you and the estate into court because they aren’t happy with how the process is going.
Ideally, heirs already knew and understood the contents of the will or estate plan previously. However, expectations and memories are not foolproof. It’s easy for people to anticipate more than was allocated to them. Discuss thing early with everyone involved and strive for complete transparency.