One issue which people planning their estates frequently struggle with is who to appoint as their executor. The choice for this important role deserves serious consideration. There are many factors to be taken into account in selecting the right person, one of which is his or her age.
Your executor’s role is to administer your estate (which includes your assets and your liabilities) that you leave behind after you pass away. Your executor will only begin their role on your death. Their role does not begin during your lifetime – that is the function of your attorney for property.
In Ontario, a person must be at least 18 years old to act as an executor. However, it is important to choose an individual who is financially and in other respects mature enough to take on this onerous role. While there may be some exceptional young adults mature enough at 18 to fulfill the role in an exemplary manner, it is likely that at age 18 most do not fall into this category.
The role of executor entails making funeral arrangements, paying bills, ensuring dependents are taken care of, overseeing tax filings and legal matters, liquidating bank and investment accounts, selling real estate, distributing personal effects and the remaining estate and dealing with any issues that beneficiaries raise. The more complex your estate administration is likely to be, the more acumen your executor will require. While your executor can retain a professional to act as his or her agent and carry out much of the role on his or her behalf, he or she will still be the ultimate decision maker and have the legal responsibility for all actions taken or not taken.
If you wish to appoint your children but they are not yet mature enough to take on the role, you can appoint an older individual or individuals with a provision that your children be added as executors when they reach an age you decide is appropriate (for example, 25 or 30 years old). This can also be done for any separate trusts you provide for in your will. You can also include a provision allowing the first-named executor or executors to resign or terminating their role automatically after your children have begun acting, or a provision allowing your children to remove him, her or them at that time.
You also need someone who will be capable of fulfilling the role at the time of your death, and if there are continuing trusts, potentially for a lengthy time after that. Many people’s first instinct in choosing an executor to act when their spouse cannot is to turn to one of both of their parents to take on this role. This may be a reasonable choice at a younger age, but the older you are, the older your parents are. If you are planning for a role which is unlikely to come into effect in the near future, your parents may not be the best choice. In fact, it is more likely they will be looking to you to act as their executor, and in the natural order of things they will not be able, through death or incapacity, to be your executor. The same issue is likely to arise when you appoint a contemporary such as a sibling or friend. While this person may be ideal at present, in the future you will need to consider an alternate or alternates who will be available to act in the long term, in particular if there are continuing trusts under your will.
There are planning techniques available to deal with these issues as well. You can appoint an individual who may be in their senior years now as your executor, but provide for a voluntary or mandatory retirement age. This would either allow or require your executor to cease acting once they reach the age you think is appropriate, and an alternate individual could then step into the role. You can name this alternate or you can give your executor the power to choose the individual he or she thinks is most appropriate at that time.
The role of executor is pivotal in ensuring that the administration of your estate proceeds smoothly and efficiently, the more so if your estate is likely to be complicated due to your assets or personal relationships. Ensuring that you have chosen someone who is mature enough to handle the responsibility, as well as being available and capable at the time of your death can be a balancing act. Having an advisor who can help you work through the pros and cons of each choice and make appropriate provisions for the future as well as contingencies, and making sure you update the appointments you make as circumstances change, will greatly contribute to your peace of mind.
The comments offered in this article are meant to be general in nature, are limited to the law of Ontario, Canada, and are not intended to provide legal or tax advice on any individual situation. Before taking any action involving your individual situation, you should seek legal advice to ensure it is appropriate to your personal circumstances.