Q. We named our three grown sons as co-executors of our estate since they will share everything equally. We thought this was a good idea, but our attorney says it could result in fights and delays in settling the estate. So, we are thinking about having our oldest as executor and, if he is not available, name our next oldest and so on. Unfortunately, that middle child is horrible with finances! Instead of naming the middle child, can we skip him and name our youngest as second in line as executors?
A. I agree with your attorney that even though all three of your kids will share the estate equally, naming all three as co-executors is not a great idea. Having co-executors or co-trustees can slow down the administration of an estate. Generally, all three would need to go to a bank, set up an estate account and be responsible for signing checks. Additionally, all would need to execute documents pertaining to the sale of assets or retitling of accounts. Logistics can be problematic but, more importantly, what if one or the another does not agree with the proposed action?
Ask yourself these questions: When was the last time the three of them did a major project together? Administering an estate is much like running a business. Do they have experience working together? If they have worked on a major project together, did they get along and agree on important issues? Do their respective spouses get along, or could that be an additional source of contention between them?
In considering the above questions, remember that your sons will also be dealing with the grief of having just lost their last parent. Add to this the fact that they will, most likely, be inheriting the largest amount of money they have ever received at one time. Mix in a dab (or two) of unresolved childhood resentment and voila! You have the perfect ingredients for years of disagreement, possible estate litigation and a lifetime of hurt feelings. It may not turn out this way if you name all three and it is true that they can delegate responsibilities between them but having one responsible, business-like executor handling everything efficiently would be better for all concerned. Trust me on this.
As to naming your oldest followed by your youngest? Yes, by all means! You have no obligation to name your children in birth order and, if the middle child is not great with finances, he may be secretly relieved not to have the responsibility of estate administration.
Just make sure that whoever steps into the position understands a few rules: The assets of the estate are not his. Issues will certainly arise if the executor takes a position of “mom and dad left me in charge. They trusted me. I don’t need to tell you what I am doing or why. You will be happy with what you get, when you get it!” The executor should have an inner mantra of: “I am transparent in my actions. I respect my siblings’ feelings, ideas and suggestions. I execute my duties efficiently and effectively and always in accordance with the document and the law.” With a mantra like this, having one son as executor should be just fine.
Liza Horvath has over 30 years of experience in the estate planning and trust fields and is a licensed professional fiduciary. Liza currently serves as president of Monterey Trust Management. This is not intended to be legal or tax advice. If you have a question, call (831) 646-5262 or email liza@montereytrust.com
