Executor Responsibilities ~ Good-To-Know Stuff

1. Is there a will?
2. Who has Power of Attorney? Who is the Executor?
3. Executor Compensation?
3. What are the wishes of the future diseased?
4. Some considerations if a loved one is terminally ill.
5. Probate & Probate Fees

This may sound obvious, but if you have children or dependents, you need a will. If you don't and you unexpectedly pass away, the government will decide for you and have control of your money and assets. That was a scary enough thought for me. If you have an elderly parent, be sure to ask if they have an up-to-date will as well as a Living Will.
A Living Will is put into place in the event that a person is still living, but is incapable of making medical decisions on their own. For example, do they wish to have life support? And who is the family member in charge of executing these wishes?

Knowing this before hand is crucial, as this person will need to know where the will is kept. Also if the Power of Attorney/Executor happens to move far away or if there are multiple Executors, this makes things much more difficult.
There have been a lot of deaths in our family and one of the hindsights of my husband and his siblings was this very issue. His mother, who was widowed at this point, had appointed all of her four children as executors, as she felt this was the fairest way to do things and it wouldn't have been a problem except that her oldest daughter and her family were going to be moving more than half way across Canada right after her imminent death. So, when it came time to sign papers, as all executor signatures had to be on all the documents, they had to be couriered back and forth across the country each time!
The last thing I will mention here is possibly something you will have no control over, but an executor should be someone who is fair and honest, who will put the needs and requests of the deceased first and that the rest of the family can put their trust in.

Often an Executor to an estate will be compensated for their time and effort. This can vary in amount and often a family member will not want compensation because it is just something that goes along with being a beneficiary. A typical amount though, so I learned from a bank manager, is 5% of the total amount of the estate. Personally, unless the deceased had lots of real estate, assets, or a complex estate, that seems like a lot of money. My brothers and I had never discussed this, as I wasn't even aware of this until I met with the lawyer and chose not to as my own personal decision based on how the estate had been split.
However, it is something I would suggest being discussed, because there is a lot more to it than meets the eye. If I had been working fulltime outside of the home at a job, I would have had to take time off work or hired daycare if my kids had been little. It's a time consuming and tedious responsibility in of itself and if you are overcome with grief and other stresses as well, it makes perfect sense to be compensated by the estate above and beyond your portion of the inheritance.

I know this may sound morbid, but have a conversation with your parent(s) before it's too late. Knowing if a loved one wishes to be artificially resusitated or left to have nature take it's course will alleviate the family having to make this big decision. It's hard enough to make that call even when you do know. My brothers and I had to make this call and not knowing our mothers wishes would have made a unanimous decision difficult.
Also, discuss burial wishes before as well.

If there is only one thing you take away from all this, it should be this. As power of attorney, have your elderly or ill loved one add you as a joint account holder on their account(s). This was advice that my sister-in-law gave me after my mom had her heart attack and stroke 4 years before her death. This turned out to be invaluable advice, as my mom became incapable of doing her finances later on. Fortunately, she rebounded from her mild stroke and we could go to the bank together to do this. What happens, when someone dies, is that all of their assets and accounts, etc. are frozen until the estate is settled, so any funeral expenses and loose ends must be paid by the family members and often the estate is not settled until 6-12 months. In my case I was so thankful to be able to pay all the bills and tie up the loose ends (and there are a lot!) without having to worry about what I was going to pay for them with. Because my name was on the account, it was considered my money by the bank. Another reason to have a trust worthy person as executor.

The other consideration if a loved one has been given a terminal diagnosis, which was the case with my mother-in-law, is to have the investments liquidated before hand and disperse it to the beneficiaries as 'gifts'. The reason for this is to get around probate fees and inheritance tax if you reside in the US. This was an after thought, which my husband and his siblings wish they had considered before the death of their mother, as she would have been mentally aware enough for a while to have discussed this and would have been in agreement.
My brothers and I tried to put this in motion with our mother's financial advisor when we were told she probably had only a week to live, but she ended up passing away within 24 hours, otherwise it would have been feasible to do. We were very relieved she didn't wait around though!
I hope this doesn't come across the wrong way, but if you look at it from the point of having as much of your hard earned money go to the family that actually loved you, rather than dishing out large sums for fees and taxes to people that know you as a customer number, I know I would want that for my kids.
Remember, this is only a consideration and may not be the right thing for you and your family.

The term 'Probate' was completely new and extremely complicated for me to grasp, in fact it wasn't until I called my mom's financial advisor and asked him for the second time, that I felt clear on it. I will do my best at relaying what I understood from him.
A will goes to probate in order for a financial institute, such as a bank or investment firm to guarantee the disbursement of funds with as little risk as possible. Usually, it will only apply to investments that total more than $75,000 -$100,000. In some cases it is as little as $50,000, it just depends on the institute. I was told by both my mom's lawyer, who we hired to look after the estate dealings, and her financial advisor that the probate fees would be around 1.5% of the estate and that's what we ended up paying.

The probate process involves an investigation of the will at the financial institution or fund companies expense (hence the fees, which in reality, you pay). This investigation is to assure that the will in question is actually the 'Last Will & Testament' then after it goes before the court and receives an official stamp of approval that it is in fact, the last writing of the will. At this point I still felt like it was just a way for the fund companies to line their pockets. So, here's an example that was explained to me. Lets say the company chooses to guarantee and issue the funds in the will with no probate and the estate is closed and the monies distributed to the family members. But, a year later a beneficiary turns up with a copy of the will that was a more recent amendment than the rest of the family was aware of, then the fund company would be on the hook for the money. For example, if the deceased had been divorced and remarried or was involved in a relationship that was unknown to the immediate family. Now it made sense to me. I guess I was a bit naïve to scenarios like this and that they only happen in the movies, but the legal community sees it all and they really do play out in everyday life.
Anyway, I felt I understood the term and the reasoning behind the chunk of cash I was about to hand over to the lawyer above and beyond his fees.

Just to be clear, I am not a lawyer or financial advisor, I'm just my late mom's loving daughter, caregiver and executor. I hope in sharing my experiences, afterthoughts, hindsights and grasping of legal procedures that someone, maybe you, may find this really helpful in preparing for an inevitable and daunting task. I realize this is only my story and pertains to my situation, so do your own research, ask questions and seek advice from the professionals you already have in place. I encourage you to have those conversations with your loved ones and siblings, so you're all on the same page when the time comes.

To your health & happiness,

Liz