two young daughters. Smith did, finally, draw up a will with the help of certified financial planner and attorney Cheryl Creuzot. Creuzot runs her own firm, Financial Strategies Group, based in Houston, a marketing affiliate of the larger AFP (Associates in Financial Planning) Group. “A lot of people think you need to be wealthy to have a will, but that’s not true,” she says. “Anyone who has assets and concerns about the disposition of those assets should have a will.” What’s more, Creuzot advises, it’s best to have your will prepared by an attorney who specializes in estate planning. Do-it-yourself enthusiasts, unfortunately, aren’t around to see their relatives beset by problems or haggling over the details.
AN EXECUTOR. In your will you’ll name an executor (sometimes known as an administrator or personal representative). After your death, prior to distributing your assets, he or she will have to take inventory of your assets, protect them against loss, pursue outstanding claims, pay bills, file tax returns and pay taxes.
An executor’s job is not to be taken lightly, nor is your task of choosing one. For one, your executor will be responsible for protecting your heirs and making sure they receive their due. In addition, he or she can be liable to the IRS and/or beneficiaries if the administration isn’t handled properly.
While naming your spouse to serve as executor may be your first instinct, Orlando J. Antonini, a financial planner with the San Francisco CPA firm of John R. Antonini, recommends that you fight the urge. After your death, he says, “He or she probably will be too distraught to act effectively.” Antonini also recommends that you skip having a corporate entity, such as a bank trust department, take on the role. “There’s no guarantee you’ll have the same people working for you over time,” he points out, “and, besides, the people there keep banker’s hours.”
Your best bet? Try grown children. If that’s not practical, you can name a professional advisor, such as an accountant or an attorney, to serve. And remember, fees for professional services come directly out of your estate, so it’s probably best to set up a fee schedule in advance.
Whomever you choose to serve as executor, make sure you get his or her consent to serve before placing them in your will. Also consider naming a backup executor, in case whomever you originally chose can’t serve.
The next step is only logical: Go over everything with your executor. “Your executor should know what your assets are, how the title is held and where the paperwork can be found,” says Antonini. “Your executor should see your will, or at least know what’s in it, so there will be no surprises. If your executor isn’t a family member, he or she should meet your heirs to get an idea of the personalities involved.” Because your executor will be responsible for filing tax returns after your death, schedule a meeting to get both your tax preparer and executor together. That, experts say, will