In your estate plan, you should list someone you trust well to serve as your personal representative if your plan on involves a basic will or trustee if your plan involves a revocable trust. The personal representative is synonymous with executor, and he or she will be the individual responsible for collecting all your assets, lining up all your debts and making they are handled properly. Essentially, this person is the one responsible for closing your life, as morbid as it sounds.
The trustee works in a similar fiduciary capacity, but his or her job duties begin before death. Your successor trustee can begin handling your financial affairs on your behalf prior to your death in the event of your incapacity. Further, your trustee works as a fiduciary not only for you, as initial trustee, but for your beneficiaries, as well. This individual ensures that your assets are protected, and that the money is invested properly and is protected.
Choosing the right personal representative or trustee for you is a very important decision. You want to make sure this person is responsible, good with money, can handle making the tough decisions and will be able to withstand any pushback from relatives or creditors who cause any trouble. Make sure you talk with that person before you appoint him or her and get his or her consent to the appointment. I always recommend the “rule of threes” when appointing a personal representative or trustee. Your first or even your second choice could pass away before you do or be unable to accept the appointment, so it is a good rule of thumb to have at least three lined up should the unthinkable happen.
Just because you trust your personal representative or trustee and believe he or she can handle tough decisions does not mean you should make the process any harder. Once you pass away or are incapacitated, this individual is going to have to somehow figure out what all you have to make an inventory of your assets and debts. If you own your own home, he or she will need to know what bills are out there and continue paying them until the house is sold or transferred. What bank accounts do you? Do you have any outstanding monthly bills? These questions are important and need to be answered as soon as possible by your personal representative or trustee. Keeping a list of what you have will save that person a huge amount of time and effort, and it will avoid anything being overlooked or forgotten in the process.
I also always recommend clients begin putting together an ongoing list of important contacts, keeping this information handy with your estate documents. A spreadsheet is an excellent way to do this, making it easy for you to update as needed. In this list, make sure to include your estate attorney, financial planner, and tax accountant, in addition to their contact information. List information for all of your financial accounts so that the trustee or personal representative can locate these accounts easily. Essentially, whatever you can do to make the process as seamless as possible is best.
Once you make the list, keep it updated. Also, make sure your personal representative appointee knows where to find it. Tell him or her where you keep your bills and statements, and even discuss how you would like things to be divided in terms of personal property. All of this effort will only help him or her in the end.
At Sullivan Law, we offer estate planning packages at a flat and reasonable fee. We also offer free consultations to discuss what your needs are, what you would like to do, and how that can be best accomplished. Everyone’s needs are different, and your wishes should be clearly listed and understood.
Call us at 248.917.1351 or email at asullivan@sullivanlawonline.com to schedule your free consultation today. We look forward to working with you!