One very important aspect of a Last Will and Testament is the designation of specific people to take care of your minor children and future financial affairs. Designating people you trust to care for your estate and your loved ones is essential for giving you some peace of mind. By using your Will to select trustees and guardians, you can maintain some control of the future of your children. If you do not designate someone to physically care for your children and to manage their finances, the court will appoint someone to do it. The court-appointed trustee or guardian may not be someone you would have chosen.
A Guardian for Minor Children
Your Will should designate someone to care for your minor children. You should give careful consideration to choosing someone your children can love and respect and someone you would trust to care for your most valuable asset. Once this person (or people) is appointed by the Court, they have the power and authority to make all decisions concerning your children’s health and well-being until the child turns 18, so choose carefully. It’s also good to have a back up person named in your Will in case that person cannot, or chooses not to become the guardian of your children. It is a hefty responsibility and not everybody is up to it.
Your Will should also designate someone to serve as your executor. As silly as it sounds, your executor executes the provisions in your Will. He or she notifies beneficiaries, probates the Will, gathers assets, pays the expenses and taxes of the estate and eventually distributes the estate to the beneficiaries. The duties of the executor usually last a few months but can last to up to two or three years for very large, complex estates with multiple beneficiaries.
That same person you designate as your executor can also be designated to serve as trustee of any trust you establish through your Will. Or, if you prefer, you can name someone other than the executor. The trustee is the individual who manages a trust for the benefit of the beneficiaries and should be someone you would trust to make responsible financial decisions. Trusts are often set up within a Will for minor children, grandchildren or beneficiaries with disabilities. Depending upon the age of the beneficiary, the person you choose as a trustee may be in that position for many years.
Both the executor and trustee are allowed to take statutory commissions. This means that the amount of the commission is a percent fixed by state law. The executor gets a one-time fee whereas the trustee can get paid for every year he or she is in charge of the trust assets. Your Will can negate that and declare that neither the executor nor trustee is to receive any commission. This is something to consider when choosing these fiduciaries. Are they taking the position because of love and affection of you and your beneficiaries or are they taking the position because of the commission? Declaring in the Will that these people are to receive no commission ends that debate.
The bottom line is that you should choose these people carefully. It is not always the oldest or the person closest in proximity to you that should handle these positions. It should be the person most qualified. An experienced estate planning attorney can assist you in making these types of decisions by adding a more objective viewpoint.