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Serving as the Executor for a Loved One
April 16, 2015
Have you considered what happens to your financial accounts when you pass?
The reality is that you leave behind loose ends: personal belongings, utility connections, medical bills, perhaps a mortgage and other debts, and more.
To address these concerns, it is imperative that you have the proper channels in place to grant access to those you trust and care for. It is important to know, even at times a beneficiary or executor may not have legal access to your funds. Access to your personal financial accounts are granted as follows:
Joint account holder – If there is a joint account holder listed on the account, the funds are ONLY available to that person. This overrides beneficiaries and executor.
Beneficiary – If no other account holders are listed, any listed beneficiary is granted full access to your financial account.
Executor – When no joint account holders or beneficiaries are listed to the account, the executor is able to access the financial account in question with a probate or court order.
The executor, also called personal representative, will also be legally responsible to take care of other duties associated to the estate. The executor is the person named in your will or the person a probate court appoints, to tie up those loose ends over a period that typically lasts six months to a year or longer.
Major duties of the executor include:
• Listing and valuing assets • Locating creditors and paying debts • Filing tax returns • Caring for property until the estate is settled • Selling property • Distributing proceeds to heirs
The executor has the power to get help with these duties by hiring an attorney, a trust administrator, or other professionals, with their fees paid by the estate.
The executor can be held legally responsible if the estate is mishandled or taxes are unpaid.
Equally important, family arguments can arise and create lasting ill will unless the executor is a good communicator who continually shares information about what the deceased wanted, legal requirements, and progress made in settling the estate.
In exchange, executors are eligible to receive a fee that generally ranges from 2% to 4% of the estate’s value, depending on state law.
But experts say executors often refuse the fee and instead act out of affection. For many executors, the reward often is knowing that their loved one’s wishes have been followed to the end.
Copyright 2010- 2015 Central Sunbelt Federal Credit Union and Credit Union National Association Inc. Information subject to change without notice.