Estate Planning Choices Beyond Your Assets

The people you choose and what they do

When people start to think about their estate planning, they understandably focus on their assets.  Who do they want to leave their assets to, how should the assets be left (outright or in trust), and what are the tax implications of their bequests.

All of these considerations are very important, but also important is who you choose to help effectuate your estate plan after you die.  Who are the people you will need to ensure your wishes are carried out appropriately?

What people are needed?

If you have a Will, you will need to name an executor of your estate.  Any trust you create (either in your Will or outside of it), will need a trustee to be appointed.  If you have minor children, you should nominate a guardian to handle the affairs of those children.

What does the executor do?

The executor of your Will is responsible for the administration of your estate.  The executor will collect your assets, pay your bills, and distribute the balance of your estate to your beneficiaries.  The executor will serve for at least seven months, but could serve for longer, depending on the complexity of your estate. 

How is the executor appointed?

You nominate your executor in your Will, and the executor must probate your Will in the local county Surrogate’s Court.  The Surrogate’s Court judge is the one that actually appoints and empowers the executor to do their job.  If for some reason, the Court does not find that your nominated executor is appropriate, then it is empowered to appoint someone other than your nominated choice.

What does a trustee do?

The trustee will manage the income and assets of any trust you create.  Trusts may be created when you are living, which are sometimes called living trusts or inter-vivos trusts.  Trusts that you create in your Will and take effect after your death are known as testamentary trusts.  The trustee will pay the bills of the trust and distribute the trust income and principal to its beneficiaries.  Depending on the terms of your trust, the trustee may act for several years.

How is the trustee appointed?

If the trustee is named in your living trust, you appoint them by virtue of naming them.  They may be the initial trustee, or perhaps a successor trustee after someone else serves.  If you are creating a revocable living trust, it is common for you to act as the initial trustee and name another person as a successor trustee.  If the trustee is named in your Will, then they will be appointed by the Surrogate’s Court, in a way similar to the appointment of the executor.

Who do I choose?  

When you choose an executor or trustee, it is important to choose someone who is organized, diligent, and reasonably adept with finances. Your executor or trustee will likely utilize the services of professionals, such as attorneys, accountants, and financial advisors, but they have an independent duty to do their job properly regardless of whose services they employ.

People often choose close and trusted family members or friends to act as their executors and/or trustees.  In addition, many financial institutions, like local banks have trust departments that can perform those services.  People will sometimes pick a close friend or family member but have a financial institution act as a successor in the event their first choice becomes unable to act due to death, disability, or resignation.

What about guardians?

If you have minor children (under the age of 18) or children with disabilities, then you will want to nominate a guardian for those children in your Will or Trust.   The guardian will act in the event that both parents pass away while the children are still minors.  The chosen guardian will act with regard to the financial and personal affairs of the children – essentially acting as a surrogate parent.

As with an executor or trustee for a testamentary trust, the guardian must be appointed by the Surrogate’s Court.  The person or persons who you nominate will need to petition the Court to be appointed. 

Who do I choose? 

In choosing a guardian of your minor children, you should consider who amongst your family and friends shares your values regarding child rearing.  You want someone who would basically make the same or similar decisions regarding your children’s upbringing, i.e. what school they attend, whether they are raised within a particular religious faith, and what decisions should be made regarding their medical care.

Parents of disabled children have similar choices.  It is advisable to establish your guardianship of your disabled child when you are living and to have a successor guardian in place when you pass.  People will often choose another one of their children as successor guardian of their disabled child.

It is natural to give a lot a thought to who you would like to receive your assets if you pass away.  You must not forget, however, to also give appropriate consideration to who will be in charge of those assets and who will look after your children, after you no longer can.  To ensure you make the right choices, you should discuss your options with an experienced estate planning professional, who can help you make educated decisions for these important positions.

Matthew J. Dorsey, Esq. is a Shareholder with O’Connell and Aronowitz, 1 Court Street, Saratoga Springs, NY. Over his twenty-nine years of practice, he has focused in the areas of elder law, estate planning, and estate administration. Mr. Dorsey can be reached at (518)584-5205, mdorsey@oalaw.com and www.oalaw.com.  

Matthew J. Dorsey, Esq. is a Shareholder with O’Connell and Aronowitz, 1 Court Street, Saratoga Springs, NY. Over his twenty-nine years of practice, he has focused in the areas of elder law, estate planning, and estate administration. Mr. Dorsey can be reached at (518)584-5205, mdorsey@oalaw.com and www.oalaw.com.