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Choosing the Right Executor or Trustee

You have not chosen the right executor or trustee

No matter how much effort you put into planning your estate, your plan will not work smoothly if you choose the wrong executor - or, if you have a living trust, the wrong trustee.

Your executor (referred to as a "personal representative" in some states) may have a wide range of responsibilities, such as arranging probate, identifying and taking custody of assets, making investment decisions, filing tax returns, handling creditors' claims, paying the estate's expenses, and distributing assets according to your will. The trustee of a living trust (also called a "revocable trust") will have similar responsibilities. Here are some common mistakes people make when choosing an executor or trustee:

Automatically choosing a family member.
You want to select someone you trust, and a family member may be appropriate. Too often, though, family members lack the requisite skills and experience with financial matters — though they can retain professional advisors. Also, choosing a family member can create tension if other relatives believe your choice is biased.

Choosing someone far away.
Selecting a person who lives and works at a distance from the location of your assets and beneficiaries can make the process more difficult, time consuming and expensive.

Not making sure the person is willing to serve.
He or she is not obligated to take the job, so be sure to discuss your plans first.

Failing to designate a backup.
Name one or two alternates in case your first choice declines to serve - or resigns, becomes incapacitated or dies before your estate is settled. If you are having trouble finding someone who meets all of your requirements, consider appointing co-executors or co-trustees. For example, you might choose a family member to work with a financial or legal professional. Co-executors or co-trustees can create other challenges, though. For instance, you will not want to name two people who are unlikely to have a productive working relationship. 

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