Updated: Feb 25, 2020
Choosing an executor is, for many people, one of the most daunting tasks in preparing a last will and testament. As a result, people often put off doing a will because they don’t know who to pick as their executor. Hopefully, I can shed some light on some of the most relevant considerations and ease some of the discomfort with the decision-making process.
The first thing I suggest to clients is to brainstorm some possible candidates. People often apply filters right from the get-go and this can make the process more difficult. Rather than being overly restrictive at the beginning, I recommend jotting down some options, maybe 5 to 10. Once you’ve done that, you can examine the options one by one to decide if someone should make the cut.
Generally speaking, executors fall under a few basic categories: family members (typically close family members), friends and acquaintances, and professional or institutional executors.
By far the most common thing to do is to pick close family members as executors. If a person has a spouse or common law partner, typically that person is the first choice. If a testator (a person doing a will) doesn’t have a spouse or common law partner, or is estranged from their spouse or common law partner, adult children are a good option.
If the person has no adult children, siblings or nieces and nephews should be considered. Sometimes cousins are chosen if a testator is an only child.
What about people like parents or uncles and aunts? They can be fine if the testator is still quite young and the parent or uncle or aunt is still relatively young. However, in most cases you want to avoid picking an elderly executor, except perhaps if that person is your spouse and you are elderly yourself.
Friends and acquaintances
What happens if you don’t have any family to speak of, or you have family members but you’re not particularly close to them, or you’re close to them but you don’t think they have what it takes to administer an estate? In those cases, you might look to friends and acquaintances.
Keep in mind that being an executor is a bit of a chore, to put it mildly. By appointing someone as an executor, you’re essentially dumping a burden on them and possibly even opening them up to legal liability. As such, if you choose someone with whom you’re not particularly close, they may be inclined to turn down the appointment. Just because you appoint someone doesn’t mean they have to accept the appointment, and just because they tell you they’ll do it at this point in time, doesn’t mean they’ll be inclined to accept the role at the time of your death.
If someone is your BFF (best friend forever), then they might be willing to accept the appointment. For those who are more casual friends and acquaintances, they’ll likely only agree to accept the appointment if they know they’ll receive sufficient compensation for the time and headache involved in administering your estate.
For that reason, people usually only ask friends or acquaintances to agree to take on the appointment as executor if they have no acceptable options among their family members.
Professional or institutional executors
Sometimes professionals such as lawyers and accountants will be appointed as executors. In Canada, this is pretty rare. Any professional taking on an appointment as an executor is opening themselves up to potential liability. For that reason, a professional accepting an executor appointment will typically want to charge a lot of money for taking on the role, whereas executors who are family members and/or beneficiaries will often work for free.
Many banks and financial institutions are willing to accept executor appointments. Again, they’ll charge a pretty penny for their services. Testators who are tremendously wealthy may wish to use professional or institutional executors. Also, testators who lack close family members or friends, or who feel it is inappropriate for some reason to choose their family members or friends, may wish to consider appointing professional or institutional executors.
Professional or institutional executors typically require testators to sign agreements in advance of doing their wills that specify things such as executor compensation. These agreements are usually explicitly referenced in the wills that are then drafted. It is also common for institutional executors to have clauses in such agreements that permit them to invest in their own financial products when administering estates for clients.
In addition to acting as estate administrators, professionals and institutions such as banks and trust companies will sometimes act as attorneys for clients under enduring powers of attorney.
Characteristics to look for in an executor
You want your executor to be reasonably smart and reasonably responsible, but that doesn’t mean your executor needs a particular background, such as a degree in law, accounting or finance. Your executor should ideally be in the same province. Executors who are outside of Alberta may be required to provide bonds to take on their roles. An executor who lives in the US will have to file with the IRS. As such, all things being equal, it’s better to have a local executor.
Appointing a first choice and one or more alternates
It’s possible that at the time of your death your executor will already be dead or mentally incompetent. It’s also possible that your executor may have changed their mind about administering your estate. Therefore, it makes sense to appoint a first choice and one or more alternates.
It’s possible to appoint two or more people to act as co-executors. Such a strategy has pros as well as cons which I won’t get into here. If you’re picking two or more people to act as co-executors, consider whether you require them to act together on everything or whether you are okay with them dividing up the workload as appropriate. If you want your executors to work together on everything, then they should be appointed jointly. If you want them to be able to divide up the workload as they see fit, then the will should state that they are being appointed “jointly or severally”.
Keeping it simple
While I’ve presented several options, when considering who to appoint as executor, try not to overthink it. In the vast majority of cases, spouses (or common law partners) and/or adult children are the ideal candidates. Siblings or nieces and nephews can also be good choices. Rarely does a person have to look outside of their family when choosing an executor.