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Being an executor: What you need to know

Make sure you know what’s involved before you say yes

So you’ve been asked to be an executor (known as a liquidator in Quebec) for a friend or loved one. An easy ‘yes’ right? Not so fast. While being an executor for someone is an honour and means that they trust you to manage their estate, it also comes with a great deal of responsibility. Before you say yes, be sure you understand the obligations and the risks, and carefully evaluate whether you’re prepared to take on the challenge.

What is an executor?

An executor is a person appointed by an individual to manage their estate after they pass away, based on wishes they’ve outlined in their will. An executor can be a trusted friend or family member, a lawyer or accountant, a trust company – or several of these people working together.

What does an executor do?

In short, an executor is responsible for making sure the details in a will are carried out. But there are many steps involved in making that happen.

Immediate responsibilities involve locating the deceased’s will, as well as securing assets so that they are not losing value. An executor also has to take care of settling any debts, filing taxes, distributing any remaining assets as described in the will to beneficiaries, and deal with digital assets.

As an executor, you can hire others to assist you with the more complex tasks of administering an estate – like a lawyer, accountant or financial advisor – but ultimately, it is up to you to ensure that the duties of the role are carried out.

Being asked to be an executor for a friend or loved one signifies that the person trusts and respects you to handle their affairs competently and honestly, and it gives you the opportunity to ensure that their wishes are carried out. Being an executor can also offer a sense of closure and a final way to honour a person. And you also play a crucial role in making sure beneficiaries receive what is promised to them, which can be a gratifying experience.

The process of settling an estate can be lengthy, often taking months or even years, depending on the complexity of the estate. Not only that, but an executor must navigate legal and financial requirements which can be complicated, and requires some familiarity with estate laws and procedures. Executors may also need to mediate disputes among beneficiaries which can be stressful and challenging. And if you’re grieving the loss of a loved one, navigating the challenges of the role while managing emotions can be taxing.

What if I’m unable to later serve as an executor?

If an alternate executor is named in the will, they may be able to take over your duties. The courts can also appoint someone to distribute the estate if no alternate has been chosen.

6 questions to ask before you decide to take on the executor role:

Do I have the time and availability required to manage the role?

Can I manage the emotional implications of managing a loved one’s affairs?

Do I live in the same city as the person who has asked me to be an executor?

Do I anticipate potential conflicts or difficult family dynamics among beneficiaries?

Do I have at least a basic understanding of legal, financial and estate planning matters?

Am I willing to research or learn, or open to seeking guidance or professional help to manage the estate?

Tips to help reduce the stress

Decided to take on the executor role? Here are some tips to consider as you navigate this complex process:

▢ Discuss expectations and responsibilities with your loved one (if possible)

Ask detailed questions and request to see the will so that you can get a better idea of the complexity involved.

▢ Educate yourself

Research estate laws and processes in your province so that you have at least a basic understanding of what’s involved.

▢ Feeling overwhelmed?

Consider hiring a professional executor, accountant, lawyer or financial advisor to help with complex issues and help ease your burden.

▢ Don’t forget that you are generally entitled to compensation for the work you put in

An executor typically receives a percentage of the estate assets; generally this falls between 2.5 and 5 per cent of the gross value of the estate, with the exact percentage depending on how complex the estate is to administer.

▢ Stay organized

Keep thorough records and documentation throughout the process

▢ Set boundaries

Administering an estate is essentially a part-time job for a year; be aware of your personal limits to manage stress and responsibilities.

We can help

If you’d like more information on being an executor, ask your Richardson Wealth Investment Advisor for a copy of our “Being an Executor” education article, as well as our “Executor’s Checklist” which outlines key steps to take immediately, and at various stages throughout the year.

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