February 26, 2018
Estate Planning – Naming the Right Executor for your Will
Every will names an executor. The executors function is to become your personal representative to look after all legal matters concerning the rights and obligations that you leave behind, and to carry out the wishes of your last will and testament. I tell clients that your executor is the CEO of your estate.
There are four qualities to a good executor:
- They have to be trustworthy with money. This means that the person has honesty, integrity, and does not have a history of being irresponsible with financial matters. In my view, this qualification is mandatory for any executor, and any person who does not meet this criteria, should not be your executor.
- The person should have a fair chance of surviving you, and a good chance of being part of your life when you die. A close family member (spouse, child, or younger sibling, will often meet this criteria). A good friend, neighbour, or business associate, may meet this criteria, but often does not. You should always name a second person as an alternate executor, in case your first named executor dies before you, is unable to act, or simply doesn’t want to accept the appointment.
- The person should be reasonably diligent and prudent. They do not have to have above-normal intelligence, or have a high-end professional occupation. They should be smart enough to know what they donâ€™t know, and to get professional advice when they require it.
- It is helpful (but not mandatory) if the person will likely be geographically close to where you reside at your death, and preferably in Canada. When you die, all of your property becomes a trust, and your executor become a trustee of your assets. The location of the trust is the residence of the trustee, which can sometimes have adverse tax implications for your estate.
The person you name in your will as executor does not become your executor until you die, and the person accepts the appointment. Therefore it is always a good idea to ask the person in advance, so that you can feel fairly comfortable that he or she will accept when the time comes.
One final note: I have never seen a situation where it is a good idea to name two persons as joint executors. Naming two or more children (even in the most harmonious of families) is a recipe for disaster. You wouldnâ€™t ask two of your children to drive you to your lawyers office to sign your will, so why would you ask two children to drive your estate. The result in both cases, would most likely be a crash.