Choosing the Right Executor or Trustee for Your Estate Plan

When you are creating your estate plan in Colorado, naming your trustee and/or personal representative is one of the most important choices you will have to make. That person (or organization) will be legally responsible for carrying out your wishes, settling your debts, distributing your assets, and often resolving delicate family dynamics. The wrong person can cause unnecessary stress, delays, costs, and/or necessitate court intervention. So how do you make the right call?

Personal Representative vs. Trustee: Know the Difference

• Personal Representative (or Executor in other States): This person is appointed through your will to initiate, manage and oversee your estate in probate, including filing all necessary paperwork, paying debts, and distributing assets.
• Trustee: This person is appointed in your revocable living trust to manage, oversee and distribute assets according to the terms of your trust.

Traits to Look for in an Personal Representative or Trustee

For either position, you should choose someone who is:

• Trustworthy: If you do not inherently trust the person you are choosing as personal representative or Trustee, then you need to choose someone else.
• Responsible: The person you choose should be adept at handling money, legal documents, and deadlines, and they should generally be a responsible adult in their own lives.
• Willing to Learn and/or to seek Help: Most people have never acted as a personal representative or Trustee before, so if the person you choose has never acted as a personal representative or Trustee, then the person you choose must be willing and able to learn how to do the job and/or willing reach out to professionals like an attorney, CPA and/or financial advisor for help.

Should You Choose a Professional or Family Member?

If you have family members or friends who meet the basic traits as set forth above and they can maintain a neutral perspective in managing your estate, then family members or friends are often the best people for the job of personal representative and/or Trustee. However, in some cases, appointing a third party like a trust company, attorney, or CPA may be the best option—especially if:

• Your estate is large or complex
• Family relationships are strained
• You want complete neutrality in how the estate is handled

Always Name Backups

Even if you have a great person who meets all the criteria to be named as a personal representative or Trustee, you should always name at least one alternate, back-up personal representative or Trustee. The reality is the life happens (death, incapacity, change in relationships), and the people you name end up being unable to do the job. That is why having a back-up or two is vitally important in case your first pick is unable to serve.

Closing Thoughts

The person you name as personal representative and/or Trustee will have a significant role in honoring your legacy. You should always take time to talk to them now to make sure they are willing and able to take on that role in case something happens to you. Also, you should revisit your estate plan in Colorado at least every 3 to 5 years to make sure your plan and the people you chose to execute your plan are the still the best for right now.If you want or need help choosing the right fiduciary, The Law Office of Kevin R. Hancock, LLC, guide you through your estate planning options in Colorado.