Choose the Right Executors to Protect Your MoneyEd Olkovich
Here’s why people never make wills and how you fix it.
Many people do not know who to name as their executor. They cannot envision who would handle their affairs. I ask clients in my law office why they didn’t make a will sooner. Many say, “I could not find the right executor.”
Without any trustworthy family members, many people don’t make a will. They don’t know how to choose the right executor. They are not sure what their executor must do and how to pay them.
Well, if you are in that boat, here’s good news. I can help you with my insider’s tips.
I am launching a series of blog post at MrWills.com – The Home of Happy Executors. I cover steps for you to get the right executor. At the end of the series, you can get this free guide.
How to Choose the Right Executors
Here are the topics I cover in the series to Choose Executors Wisely:
1. Why Choosing Executors is Important
2. What Executors Do
3. The Checklist for Executor Choices
4. How to Find Your Right Executor
5. Tips to Choose Your Executor
What is the Big Deal about Executors?
I’ve seen firsthand how bad executors create disasters. It happens even in the best families. I’ve written about this since I wrote my first Complete Idiot’s Guide® book in 1997.
You name someone as your executor in your will. Executors control when your family receives their inheritance. What happens if you choose the wrong executor?
Executors who are dishonest, incompetent or lazy can ruin your family’s inheritance. My advice is: Don’t put a fox into the hen house.
Court battles with bad executors can add years of waste and delay.
The wrong executor steals your money and ruins families. Once they are in charge, it’s hard to get rid of a bad one. I’ll tell you about one called Tony.
Courts Reluctantly Remove Executors
Tony was his Uncle George’s executor. Tony arranged his uncle’s funeral with an expensive reception. He bought a plot and an expensive headstone. This was despite everyone’s protests. Uncle George’s sister, Alice, said, “My brother wanted to be cremated in a simple service”.
“Too bad,” Tony said to Alice. “He never told me that. I am the executor and I make all the decisions. I don’t like cremation and I don’t have to check anything with you.”
Tony held George’s wake at his golf club. Tony’s golf buddies toasted George at the estate’s expense. The tab for the food and bar was over $6,000. Alice and other relatives did not bother to attend.
Can Judges Remove Executors of a Will?
Only a judge can get rid of a bad executor. Someone must go to court. Can your family afford lawyers? Can they prove that Tony was harming the estate by:
- committing fraud
- stealing estate money
- wasting estate dollars
- mistreating beneficiaries (whom Tony disliked)
- being incompetent
- putting George’s money in danger
- failing to distribute assets
Such allegations are difficult to prove. A judge may not intervene unless there is serious misconduct.
Tony did not get removed as executor. He also did not tell anyone what he did next.
He took $300,000 from his George’s estate and invested in his company’s new invention – the perfect putter.
Too bad Tony’s company went broke. Tony then told his family (after paying his legal fees) there was nothing left. He never distributed George’s estate.
Tony’s behavior is regrettably common. Some executors abuse their positions.
How can you avoid these problems?
Sometimes it is as simple as naming a new executor.
You don’t need to be a millionaire to have your money wasted.
Legal expenses can eat up your estate. Your hard-earned money gets squandered.
Have You Got Wrong Estate Executor?
Should you always name family as your executor? You may want to re-consider such decisions if, for example, your children:
- don’t get along
- are receiving social assistance
- are stepchildren from a subsequent relationship
- have been married several times
- struggle with financial difficulties
- cannot be trusted
- live out of the country
The right executor avoids conflicts, comforts your family and controls costs. Make sure you have the right executors. Don’t force loved ones into a court battle to remove bad executors.
What Happens if You Chose the Wrong Executor?
What can happen after you are gone?
Your family can challenge your decision in court. They can show a court reasons why your chosen executor should be disqualified. The trick with someone like Tony may be to try and stop him.
This legal action can keep your estate frozen – bills won’t be paid and investment decisions will be deferred – until your family can agree on appointing a new and neutral executor (i.e. a lawyer, accountant or trust company).
Easy Steps to Choose Executors Wisely
I have spoken to public and professional audiences across Canada. Choosing executors is always confusing. Advice is not always independent or free.
People want to know if they can name their spouse as executor. Is that a conflict of interest? You will get answers to this question and much more in Choosing Executors Wisely.
About Edward Olkovich
Ed Olkovich is a nationally recognized estate expert. He is a Certified Specialist in Ontario estates and trusts law. His law firm’s website is MrWills.com — The Home of Happy Executors. Visit Ed’s blog, MrWills.com, for more free valuable estate information. (c) 2016