How to Serve as an Executor Video from Savant Wealth Management

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Download our complimentary guide books, checklists, and other useful financial resources at savantwealth.com/guides. Good afternoon and welcome to our Savant webinar series.  today we’re talking about how to serve as an executor. I am Joel Cundick. I’m a financial adviser in Savant’s Vienna, Virginia office. And joining me today is Alaina Davalos. She’s a wealth transfer adviser on our team out of our Atlanta, Georgia office. Hello, Alaina. Hi, Joel. Thanks so much for having me today. I’m really glad to be here. It’s good to be together. This is inevitably one of the more attended webinars that that that we host. And I think the reason is people have a lot of questions around what happens when I die or when somebody I love dies who may be naming me as an executor. So, we’ve got a pretty big audience to cover today with a number of different questions. I think I think and I want to just let everyone know that while we won’t be providing today’s slides, you know, we will be taking some questions from the Q&A box. So, please feel free to submit those at the bottom of your screen. And we’ll also be emailing out a recording of this webinar. So, be on the lookout for that in the next couple of days. Great. And the other thing that will always be possible, we’ll send out a link at the end in the chat so that you can schedule some time to sit down and talk with us one on-one about your personal situation. We’d be glad to hear your individual questions one-on-one. So, what are we covering today, Alaina? It’s a pretty broad topic. Yeah, for sure. So, looking through today’s agenda, we’re going to first go through the different roles of executor and a trustee. you know, as well as discuss the differences between those two. Then we’ll move on to must-have estate planning documents before looking at beneficiary and asset titling decisions as well as important tax filings. And then finally, like I said, we’ll end with promoting family harmony and taking some questions. You left that last one to me. I don’t know how successful we’ll be at promoting family harmony, but I’ll put some thought into that. We’ll see where we can go. I believe in you, Joel. I think by the end of this webinar, you know, you’ll know enough on how to promote that family harmony. But before we get there, before things get too exciting, let’s look at the roles of an executor and a trustee. So before we dive into the details about actually serving as an executor, which is I’m sure why many of y’all are here today, you know, I do want to give you a reminder that estate planning, probate, trust, they’re all subject to state law. So while we’re going to talk generally about these topics, please know that you should also consult a local attorney before engaging in any of these activities. But generally speaking, the role of the executor stays the same state by state. The executor is the person who will have the legal authority to transfer assets from the decedent’s estate to the final beneficiaries. They’ve got the legal duty to remain independent. They represent the estate, not the beneficiaries. When it comes to handling the decedent’s assets, they’re also responsible for a number of logistical things such as filing the decedent’s final income tax return and taking care of any estate returns that are due. This position can entail a good bit of work. However, we’ve often seen that the executor plays a much larger role than just taking care of business. You know, they’re also the one that the family typically turns to preserve family harmony. And that’s something we really want to emphasize in today’s presentation is just how important this role is in terms of keeping the family together. So, let’s look at that executor’s role. You know, I found throughout my time in private practice that most people’s perception of an executor and the probate process generally comes from TV. You know, on TV, there’s usually a gathering of the family in the lawyer’s office. Everyone is waiting with bated breath to see what they’re going to inherit. The executor is announced. It’s not who the family expected, and it’s all very dramatic. In reality, there’s usually not a spectacular event. You know, a person who passes away is called a decedent. The decedent either had a last will in testament or they didn’t. If they had a will, it most likely named someone as the executor. The will may also refer to that person as a personal representative or an administrator. For our talk today, as the theme of this webinar suggests, I’m going to use the term executor and that’s for someone that has been appointed under the will. for the family to first find that will. It’s usually with the decedent’s personal effects, maybe in a safety deposit box, maybe it’s with the drafting attorney. Most wills today are written in modern English and are relatively easy to understand. Sometimes there is a lot of language in the document. You know, I myself was known to draft a 50-page will on occasion, but identifying the nominated executor is usually pretty simple. The executor though is not automatically in power. Repeat, just because someone is named in the will as the executor does not mean that they immediately have the authority to act on behalf of the decedent’s estate. Why? Well, for starters, the decedent may not have a probate estate, meaning that there are no assets that the will controls. A will, and hence the executor, only has authority over assets that were in the decedent’s name alone at their death or directed to the estate via beneficiary designation. The will does not control assets that had a joint owner or a beneficiary designation, naming someone other than the estate. Common probate assets include real estate owned in the decedent’s name alone, checking and savings accounts with no pods, which stands for payable on death, and brokerage accounts. This is not a complete list by any means, but these are the most common. So let’s say that a student had at least one of these probate assets in their name at their death. They also had a last will in testament. How does the executor then gain their legal power? As I mentioned, this area of law is very state specific. So each state has their own rules and regulations about going through the probate process. Just so you know, because you know I love to drop all the legal. The American Bar Association defines the probate process as the formal legal process that gives recognition to a will and appoints the executor or personal representative who will administer the estate and distribute assets to the intended beneficiaries. Generally the decedent’s heirs at law and the beneficiaries under the will those are not always the same. Typically, they will have to be notified and given an opportunity to object to the validity of the will. If there are no objections, everyone agrees, the court will issue the executor legal documents authorizing them to act on behalf of the estate. The court may also require the executor to post bond based on the projected value of the assets in the estate, file an initial inventory and provide an annual accounting every year the estate is open. So do keep that in mind once the executor has those legal documents from the court. You know, you can see here on your screen the usual process. Once the executor has filed the will, they’ve got to administer the probate estate. They’ve got to collect the bank accounts, get appraisals on the real estate or list it, notify business partners of the death. What their work really entails is based on the actual assets of the estate itself. The executor typically must also notify any of the decedent’s creditors of the decedent’s death and pay final expenses. That includes any funeral bills, cost of administration such as legal and CPA fees and taxes. The executor is the one who is also legally responsible for filing any final tax returns that are due which I am going to talk about in greater detail in a minute. Once all those debts have been paid, that’s when the executor will then distribute assets according to the terms of the will to the beneficiaries. Once all of that has been completed, the executor can formally close the estate. Closing the estate generally releases the executor from any further liability related to their role as executor. They’re hanging up their hat. They’re saying, “That’s it. I’m done. Don’t spend your inheritance all at once. I’m kidding. But you get the gist. Their job is complete. And while this sounds relatively simple, and it can be, there are also a lot of aspects of being an executor that can make it an undesirable job. One of those is family conflict. Other problems include taxes un and unusual assets like business interests, oil and mineral rights, out of state real estate. These can all make this sort of harder work for your executor. However, with good planning, the executor can be a short-term role that keeps the family harmony and sufficiently and succinctly distributes the decedent’s assets. And on the flip side, an executor can get paid. You know, either the will or state law dictates what the executor is entitled to for doing all of this work. So, make sure you know if you’re creating your own will or if you anticipate acting as an executor, you’re aware of what those executor fees are. There’s another rule that I want to clarify for you all because I had and still have a lot of clients that use these terms interchangeably even though they do have separate meanings and that is the trustee. A trustee is someone who holds assets in trust for the benefit of a beneficiary. A trustee is not nominated by a will and then appointed by a court. Instead, the trustee is named under a trust agreement. For our chat today, I’m going to just refer to a revocable living trust, not an irrevocable trust, a revocable living trust is a tool that is created by a person called the guarantor or the trust to hold assets in trust. Generally the guarantor is the initial trustee, the initial beneficiary and the trust uses the guarantor’s social security number. The primary purpose of the revocable living trust is to avoid probate at the guarantor’s death. Unlike the guarantor who is a human, the revocable living trust does not die. So assets that it holds do not need to go through probate. So that whole discussion we just had about appointing the executor, going through the probate process, the revocable living trust is designed to avoid that pro process for an executor. The revocable living trust, you know, it’s funded two separate ways. It can either be funded during lifetime by the guarantor themselves or at the guarantor’s death via the probate process. So, you heard me right. Sometimes an executor will have to go through the probate process in order to transfer assets to a trustee. A lot of times the executor of the will, which when combined with a revocable living trust is called a pour over will. And the trustee of a revocable living trust with executor and trustee. A lot of times those are the same person. You know that makes for a smoother transition of assets if the pour over will does need to go through probate at the guarantor’s death. The trustee’s role or the successor trustee whoever the guarantor has named to act after they are no longer with us. The successor trustee’s role is very similar to the executor’s. The trustee is responsible for administering the trust, managing the assets, collecting the trust assets, whether that’s from the executor and the probate estate or assets that name the trust as a beneficiary. The trustee then pays any taxes, debts, and administration fees not paid by the executor. Sometimes though, a revocable living trust will not end. Instead, it will morph into an irrevocable trust. In the chart you see on the screen here, we’ve got a revocable living trust that changes into a trust for the survivor, which in this case means the surviving spouse. At that surviving spouse’s death, the trust changes again into sub trusts for the children. Those children’s sub trusts are generally irrevocable. If that is the case, if the trust fund is not just simply paid out to the trust beneficiaries, then the trustee does have additional duties. They’ll continue to manage and invest the trust assets on behalf of the beneficiaries, approve any distribution requests, and file annual trust income tax returns that are necessary. They’ll also make any mandatory distributions that the trust agreement dictates, such as one-third of trust to the beneficiary outright when they reach age 25 and the balance at age 30. Whatever the trust says, the trustee must do. So, as opposed to being an executor, being the trustee can be a longer-term duty. So, do make sure you’re aware of that if you are nominated as a successor trustee under a trust. It’s really important though to differentiate between these roles because they are controlled by different documents. The trustee is subject to the terms of the trust agreement and the executor is subject to the rules of the court and the terms of the will.

Joel, can you talk to us about these estate planning documents? Go into a little bit more detail. What you talked about probably from the perspective of the people listening in today and there’s a lot of terminology. Alaina did a great job of sorting through one track of potential path that that you might go through in administering an estate as an executor and another path that you might go through as a trustee. And I think one of the things I remember growing up the day before the first day of school, my mom liked us to all do what she called a dry run, which just meant try everything out, see how everything’s going to go. Let’s figure out where there are any problems before the first day happens. Are we getting up on time? Do we have all the right stuff with us? Are we getting out to the bus at the right time? And I think something like that works really well for a process like this that is this complex is to do something of a dry run. So, one of the things you might want to think about doing, and we certainly do for our clients, is try and put this in more practical real-world terms. What does this mean for my estate? Let’s look at my documents and who are going to be the important roles? When are they going to trigger? In order to do that, we’ve got to get together what the critical documents of estate planning are. And so there’s three must-haves in estate planning and one optional that Alaina’s already brought up. I’ll talk about from a little bit of different perspective here. So the first two estate planning documents I’m going to bring up actually have nothing to do with after someone has passed away. These two documents that we draft with an estate attorney are documents that are in effect only while we are living. But they play critical roles when we can’t make decisions for ourselves. All right. The first one is the power of attorney for property. This is a document that allows for someone else to make a transaction, a financial transaction on our behalf. So it’s a very powerful document. it.  you can have this power be current standing or you can have it be springing, meaning that it will only come into effect after some kind of physician certification. But when you have a power of attorney for someone else, you can buy a property in their name, you can sell a property in their name, you can enter into a loan in their name. So when we create a power of attorney and we make it effective immediately, we have to think this is about the most powerful document that we can create in our lifetime because we’re giving someone else to do many things as if they were us.  so that doesn’t mean that we don’t do it. It just means that if we have any concern about the person we’re naming of our proper power of attorney, we either reconsider that or we be very careful about, you know, how we administer and who we give that power of attorney to so that they know what it contains. These days, we want to make sure that a power of attorney for property specifically lists digital asset authority because there’s no other way while we’re living and incapacitated for someone to go on, for example, to a social media account and make a statement on our behalf or  you know, we want them to be able to control certainly our assets, our bank accounts potentially, our investment accounts potentially to make trades on our behalf. We want to name those powers specifically of what a power of attorney can do on our behalf. One other that I will include in there a power that must be specifically named is to transact on a retirement plan or an individual retirement account or IRA. If the power of attorney does not specifically list that power, then a financial institution when it is presented with the document can choose to honor or not honor the power of attorney. So, while we’d like this to just be a power that is given automatically, generally when you are going to exercise power of attorney for someone else, you’re going to present a document. You’re going to present documents indicating that you are who the proper person is named to be the power of attorney. You’re also going to present doctor’s notices if a physician certification is necessary. And then you’re going to be subject to the will of the financial institution that you reach out to. All right? That can be a bank, it can be a brokerage, it can be part of a real estate transaction. There’s just many places you can use a power of attorney. But remember, it’s going to be up to the institution to accept or deny that power of attorney. I was talking with friends earlier this week where they had a power of attorney that was almost 20 years old. That’s a classic instance where you probably want to renew that because old documents increase the probability that an institution is going to say we don’t feel like this document expresses the current wishes of the incapacitated individual. So we want to go   go the court path. All right. But a power of attorney for property is an essential document to allow someone else to transact on our behalf financially if and when we are incapacitated. A power of attorney could expire, never used. If I am healthy as a horse and then at 85 years old I die of a heart attack. That power of attorney was never needed. But there are instances in which a power of attorney could be needed for years.  So we just want it’s a document we want to make sure we have in order so that if something happens to us someone else can transact on our behalf while we are living and incapacitated. The second document is a power of attorney for health care and advanced directive. This used to be called a living will and a power of attorney. It’s often been combined in certain states into a single advanced directive. But there’s two things going on with this document. one, the ability to name someone to make medical decisions on our behalf if we’re not able to do that ourselves. All right? So, I’m in surgery. I’m in a coma after surgery. A decision needs to be made on my behalf. I have designated one or more individuals to make that decision on my behalf when I can’t. But the other thing it’s going to indicate is a preset list of circumstances in which I already indicate my will, my interest. All right? And this is to so like if I’m hooked up to medical equipment with no hope of recovery and I’m  with feeding tubes and I either wish or do not wish life sustaining measures to be taken  on my behalf, I can indicate that in this document. Again, a very powerful document related to our life and death. We want to make sure we have it. We want to make sure the individuals we’ve named to make decisions on our behalf are our current wishes. So, if you have not brushed off these documents on your behalf in a while, pull them out and take a look. Who does it say? And then we want to make sure we give a copy of these to our doctors. All right? So, that our doctor at all times has our wishes on file with them. So, two documents in effect while we’re alive.  now we’ll go to the one of document that becomes into effect after our death which Alina already referred to is the will. The will is going to do two things that no other document can do. One, it’s going to nominate a guardian for any minor children I may have. So if you’re listening to this call and you do not have minor children, one of the purposes of a will is not necessary for you. However, the other thing that it is going to do that no other document can do is it’s not going to name my executor or personal representative on my behalf. If we don’t have that pre-determined naming in there, then we’re going to be subject to the courts. And typically, I say the worst decision you’re going to make on your own behalf is still probably going to be better than the best decision the courts are going to make for you. So, we want to make sure we name who we want to be the executor in our situation. A will either is going to designate all the places we want assets to go to or it’s going to potentially pour over into a revocable living trust. So, it says anything I haven’t given at my death to my trust I instruct goes into my trust at death. That’s a nice catch-all provision. However, if I have major assets that I have not yet titled into that revocable trust, I’m now going to have to go through a probate process to move those assets into that trust. And that’s going to take time. Far better to title an asset into the trust while we’re living so that there is not that additional probate step after our death. All right. The will when we do it, we want to be mindful of what a will controls and what it doesn’t. So, I I’ll give a classic example here that an IRA or a retirement plan is not going to be governed by a will. It’s going to be governed by beneficiaries that I have named on that plan. So if my intentions have changed and I update my will and I think great I did a new will and that took care of everything. No, it did not. It took care of any asset that is going to be governed by my will. But an IRA or a retirement plan or a life insurance policy or an annuity, all of those are going to have their own beneficiary stated and that beneficiary is going to trump whatever I say in my will. So it really matters that we do this is another place with a dry run example, right? Hey, what if I died tomorrow? Where would everything go? And to review my assets one by one to see what would happen to each of them. You may find surprises. Okay. The last of the four main estate planning documents that again we’ve covered in different viewpoints is this revocable living trust. This is not a have to.  many people choose to have a revocable living trust and the reason that they would choose it is in essence to turn much of their estate that would otherwise be governed by a will and would be governed by a court process into something similar to what I was just referring an IRA or a retirement plan or a life insurance policy were due. If I have predetermined who I would like to get things and I title assets into a revocable trust, I can avoid probate and transfer in essence via beneficiary like I’ve done with other assets. Those are the four main documents. Alaina, did I miss anything about how each of those work? Nope. I think you’ve got it covered. I think you’ve had experience a time or two with these documents. Once or twice. Once or twice. Every now and then.

So, let’s go ahead and Joel mentioned this at the end, but let’s look at how beneficiary and asset titling decisions can play into that role of being an executor. So, here is a sample estate plan. Like Joel just discussed, we’ve laid out the trust and we’ve laid out the assets, you know, and I hope you guys like this chart because this is what I normally spend all of my time here at Savant preparing every day, you know, reviewing the documents, preparing graphics like this for our clients. , so we see an example. In this example, we do have a joint revocable living trust. It’s been funded with some of this family’s assets, the trust brokerage account and the home. And then there are still some assets that are passing by beneficiary designation and by joint ownership. So this is also where I see a lot of family disconnect happen because of poor planning. For example, you know, family members will blame the executor or trustee for how the IRAs are passing. Unless the estate or trust is named as a beneficiary of those accounts, the executor or trustee has no control over them. Any issue is because of poor planning on the deed’s behalf. And well, their concerns are over at this point because they’re dead. So going back to this graph, you know, this is a relatively complicated trust with spousal sub trust and lifetime trust for the children. If you’ve worked with your attorney to come up with this plan, that’s step one, getting those documents in place. On the next slide, you’re going to see step two, which is trying to figure out beneficiary designations, which especially with qualified retirement accounts, can get tricky. So, those IRA accounts, which normally make up a significant portion of most Americans estates, do have several options for beneficiaries. In this graph here, you’ve got the spouse, client two or client one, named as the primary beneficiary. Then you’ve got the trust named as the secondary beneficiary. Joel, can you talk a little bit about how and why to pick those beneficiaries and what impact they can have on an executor? Absolutely. So, this is one of those places we want people to slow down and be careful about what they’re choosing. We can leave assets outright to our spouse and to the next generation or we can leave assets in trust. There’s a great summary here on the screen about the reasons to do outright versus the reasons to do via trust. Low complexity is probably the number one reason people choose to just leave beneficiaries outright. I leave assets to my spouse at my death. They have complete control over it. It’s very simple.  On the administration side, they just open up a new IRA or even fold the assets into their IRA. The difficulty is there’s no asset protection, meaning that that is their asset. If they are sued for any reason, their creditors can come after assets we’ve named outright in their name. All right? Because it’s their asset. Now, it’s potentially more income tax efficient. We’ll talk about that on the next slide. But what we’re the reason we would not leave outright in beneficiaries is because we want to have some kind of fence around the asset. For example, there are children from two separate marriages involved. My children I want to make sure are the ultimate recipients of my assets. I’m fine with my spouse using them over the rest of their lifetime, but I don’t want a rift to happen after my death between my surviving spouse and my biological children where they decide I don’t want to leave those assets to them anymore. When I’ve left an asset outright to a survivor’s name, they can do anything they want with that asset. It is up to their control of how it transfers. If I name instead a trust that says my surviving spouse can use these funds for their benefit and at their death they go to my children that has added a degree of complexity certainly because it’s added probably a tax return for that trust every year for example but I have made it so that I have controlled ultimately who receives the funds. Same thing is in effect for children. If I may have no concerns about my children want them to get the funds outright. I keep things nice and simple and name them. But if they are then sued, those assets, you know, could be lost to a lawsuit and they also could spend those assets at a pace that I am uncomfortable with, and I wish that I’d put some guard rails around. if the guard rails are going to come in the form of a trustee and an ongoing more complex situation, but they can still be the way I want to go if I want control over what happens at a later point to those assets. So, a classic example, we can go to the next screen, Alaina, is just we’re talking about IAS.  when we’re dealing with IAS for now, up until 5 years ago, I could leave an IRA to my children. my children could stretch the distributions over their entire lifetime.  And was really not too big a tax issue. Now with the secure act IRA assets inherited by beneficiaries that are my children are going to have to be taken out in 10 years. And if I have a very large IRA and only one child, that child could end up with a significant tax burden in those 10 years that could impact financial aid they’re applying for one of their children for schooling. It could apply   affect state benefits. If one of my children has special needs and is receiving some kind of state benefit, so I need to be mindful about how I’m leaving that asset to the next generation. This all happens in the planning side and as so as we talk about how to become how to be an executor, one of the ways to be an executor is to think about your role as executor before your executor and to look at all of this in advance and say, is this all set to go the way that I want it to go?  I can leave assets in trust through an IRA. What I need to know is that could impact taxes.  It could put it in a situation where now assets need to be distributed faster or it also could put be in a situation where assets have to come out of a trust at a pace I’m not comfortable with. So I have to work with an attorney to make sure I’ve designed even if I choose limits in a trust to have the trust be designed the way I want it. What is the pace assets are going to flow out? Do I want a conduit trust in which all IRA withdrawals go directly to the beneficiary of the trust or do I want an accumulation trust where IRA withdrawals actually go into another trust account. They don’t necessarily go out to my child outright. There’s lots of decisions involved when we decide to go to higher levels of complexity in the way that we leave assets to heirs. It doesn’t mean we don’t do it because there can be very important reasons why we are putting guidelines and guard rails around asset distribution but we need to be careful about how we do it because it can have unintended tax consequences and life consequences. That’s very true Joel and we always try to avoid those unintended tax consequences, don’t we? Absolutely. Wherever possible. Wherever possible.

 

So, speaking of taxes, along with those tax payments, of course, comes tax filings. And I’m going to go through some of the important tax filing deadlines as the executor. And this is going to apply whether your role is the executor or as successor trustee as it relates to handling assets, administering that decedent’s estate once someone has passed away. So, the first date is going to be when the decedent’s final income tax return is due. Typically, as I’m sure most of you know, that is April 15th of the year following the decedent’s death. That deadline can be extended to October 15th. Sometimes you can have even later tax filings with a complicated estate. It’s very important when you are acting as the executor, when you’re acting as the trustee to work with a competent CPA or an accountant. You know, you want to make sure that all of these filings are done timely because you have a fiduciary duty to the estate, to the trusted estate to do things on time. and you never want to open yourself up to any personal liability by missing a vital tax deadline. So, we’ve also got that same deadline, April 15th, October 15th for the estate income tax return, which has to be filed for any income earned by the decedent’s assets after their death, but before they are distributed to the final beneficiaries, so long as that income exceeds a certain threshold, which is currently $600, that estate income tax return has to be filed. Same rules apply for a trust income tax return. If you’re the trustee of a revocable living trust, now irrevocable, the guarantor passes away, the trust assets earn more than $600 in one year, your successor trustee, will need to file a trust income tax return. One other final return that the executor or trustee may also need to file is the federal estate tax return or a state tax return.  the federal return is the form 706. That return is due 9 months after the decedent’s death and it does have an available six-month extension. So unlike returns with a calendar year, this return is based off the date of the decedent’s death and that’s important to remember. Generally, an estate tax return is required when the decedent’s assets at death combined with the value of any taxable gifts they made during lifetime exceed the available estate tax exemption amount the year of the decedent’s death. That exemption amount is subject to change with Congress. It’s currently at $15 million per person under 2025’s One Big Beautiful Bill Act. If that return is required and the decedent who passed away, you are administering their estate as the executor trustee. If their estate is larger than their personal exemption, $15 million maximum, they may have to pay estate taxes and the estate tax rate itself is 40%. And that’s calculated on all wealth. So that includes qualified accounts, real estate, business interest, life insurance proceeds, anything that is being passed at death when you’re looking at the decedent’s entirety. So the other time that a 706 may be required or highly recommended is if the estate needs to make something called a portability election. Portability is when the decedent’s available estate tax exemption can be ported over to their surviving spouse. And this can be really beneficial because it can allow the surviving spouse to give more assets to the beneficiaries, typically children, at that surviving spouse’s death without having to pay any additional state taxes. If the decedent’s estate only needs to make a portability election and the estate does not owe any estate taxes, there’s a new 5-year rule to make that portability election. And so, this has been a pretty big change recently to the law. So, if you or someone you know, if their spouse died within the last 5 years, seriously consider whether filing a 706 to make a portability election would be a good idea for the estate. Like I mentioned, there may also be state estate tax returns that need to be filed as well. Make sure when you’re acting as that executor trustee, confirm with your attorney or CPA when, if any, state estate tax is due.

Now, finally, what we’ve all been waiting for, Joel, to talk to us about family harmony. Yeah. I think that one of the things I’ve noticed in working with families over 20 years on estate planning is that the administration of an estate is one of the most emotionally fraught circumstances of someone’s life. And some of you are nodding your head. You’ve been through this.  Some of you have not and you’re only contemplating it. Some of you are thinking, I don’t know what he’s talking about. I’m sure it will be straightforward for me. I hope it is. I want nothing more than for this to be a smooth process in what otherwise already is an emotionally trying time, the loss of a loved one. But there are things that we can do to maximize family harmony, the possibility of it in advance. And the one word I’ll use to summarize all of it is communication.  we have a tendency either because we don’t like talking about death or because we don’t want to put pressure or stress on our loved ones or because culturally, we just don’t like talking about these things to not talk about what our estate plan says. And we can at times put elements of our estate plan together in a way that might seem to disadvantage one of our children or might cause the potential for strife after we’re gone. And that would be a circumstance in which we’d probably be even less likely to want to communicate in advance. That said, the best way to minimize tension after someone is gone is to make there be no surprises. that everything is we are all aware of how things are going to transfer. That gives us the maximum amount of time to frame properly for adult children, for spouses, for loved ones, other loved ones what our intent was in the way that we left things. Letters can accomplish this too. Non, you know, key documents that nonetheless accompany those documents where we’re trying to explain to someone what we did. However, keep in mind that whatever we drafted there, the individual is not going to have the opportunity to talk to us to clarify intent. So, I think that is the essence of promoting family harmony is good communication. There are some documents that can help us. Elaine, if we could go to the next slide here. , one of the things we’ve created, and this really is the genesis of a lot of different , estate planning conversations, okay, a lot of different times where somebody said, “Ooh, I wish I had known this: that we put together over the years, an estate and trust administrator’s guide designed for someone to sit down and write out important information like what funeral home I’ve already contracted with, like where important estate documents are, important  brokerage accounts, life insurance policies,  important professionals who work with me, my CPA, my estate attorney, my financial adviser, all of these important bits of information that we can collate together into one place. We would be happy to send out a copy of this to you.  we want to consider in advance. Do we want to handle funeral and burial arrangements ourselves?  pay for that in advance. Make things easier administratively for our heirs. Do we want to write personal property memorandums? Are there specific assets that we want to go to specific family members? This is another place that can create a great deal of tension.  one of the ways you can just handle that is by giving personal property in advance of your death to the individuals that you want to receive it. That’s a fine move as well. But if we have assets we want to go to certain individuals, let’s make sure that we have named that. Ethical will statements. An ethical will, the idea is that it’s some way of leaving assets to children or grandchildren or other heirs that conveys the values that you have so you can make a statement about what your intent is that you hope you convey with these assets. You can also customize the way that you’re leaving assets. Sometimes children are in different financial situations than others and you choose to leave assets unequally. That should generally be accompanied with some kind of statement if you have not talked to children about that in advance. And the last thing is kind of finishing up where we started considering who you have named for the important roles in your estate plan or finding out who if you’re on this call thinking about what has have my parents done having a conversation about who are the important individuals. We’re giving a lot of power to a power of attorney for health care, a power of attorney for property, an executor, a trustee. Let’s make sure that we have named the right individuals in the right way and that we’ve communicated with them in advance so that we know they’re comfortable with that role so that this per first person that we assumed was going to be the guardian of our children isn’t put in a situation where they have to look at that plan and say I’m not in a position to do that and now all of a sudden the plan is thrown into chaos. All right, let’s look at do we want to have an individual trustee for heirs or do we want to have a corporate trustee? An individual trustee is probably a family member or close friend. A corporate trustee is a financial institution, a bank or a trust company.  There are advantages and disadvantages to each. That’s probably beyond the scope of today. But let’s be thoughtful about how we are leaving assets. The last role that I’ll mention here is a trust protector. It’s a newer role in estate plans where basically if I have a trust that is going to perpetuate beyond my death, I can name an individual who can look at the laws  and the tax situations that a trust could encounter and alter the trust to contemplate those scenarios. So, we would like for this to just be something that we can draft off in an hour and be done, handwrite it, and finish up. That’s not how an estate plan generally works these days. We need to think a little bit more in detail and have probably some sample tests of this. Well, what if I were to die now? How would assets transfer? What if my spouse were to die? How would assets transfer? And just look at practically what happened to see, oh, is that what I want to have happen in the real scenario or not? But the role of an executor is a serious one. It’s one that a lot of people have filled in the past and it’s one that you can take care of if you are assigned to it. Don’t feel like you have to face it on your own. You can bring in outside professionals to help you and there’s no reason to kind of soldier on and try and handle this on your own if you feel like it’s overwhelming to you. That covers the material that we wanted to get through today. I know there’s going to be some questions here.  We’re going to throw up there again that link for you to be able to set up a time for a free introductory meeting with us. We would love to have a conversation about your specific questions, but we’re also happy to email those to you. I know I’m going to have time for a few questions here. I’ve been combing through them, Alaina, and I’ll ask some, but if we don’t get to your question, also please put a question in the survey afterwards that you receive because you will get an answer back from us about whatever question you pose. Okay we have a few here that I jotted down. All right. The first one, Alaina, should I create a revocable living trust rather than just a will? Not sure. This was asked earlier, so we may have covered it, but it’s a good point for a summary. Do I need to create a revocable living trust? So, I think that is both a very personal question and a very date dependent question. You know, some states are relatively easy to go through probate. You know, some states it’s not something that we actively try to avoid because the problem with a revocable living trust is that for it to be truly effective, it needs to be fully funded at your death, meaning all of your assets have to connect to it somehow. You know, you have to make sure that every asset is avoiding probate either via the trust, via joint ownership, or beneficiary designations. And for some people, that is too much homework for them to take on. You know, I don’t know about you, Joel, but I have seen many an unfunded revocable trust in my day because a lot of people, they go, they sign their documents and then that’s it. They put them away. they don’t go through those next processes of funding the trust. And so I will say one of the good things about working with a financial advisor is that they are very good at helping our clients to make sure that trust is funded because they’ve got your full net worth statement. You know, they know all of your assets and we can go down that line and check them off. Say, “Yes, we’ve updated the beneficiary designations to be the trust. That makes sense.” Yes, there was a deed done. Yes, the business interests were assigned. So, does everybody need a trust? Maybe. There are a lot of benefits to them. They can provide some additional privacy. If you are ever disinheriting an heir, for example, a child, you know, a rev trust can be really helpful to avoid probate for that reason. But it is very personal. It is very state specific also. Yeah, there’s not much I like to see less in an estate planning process is looking at someone’s situation and realizing that they went to all that trouble to create a revocable living trust and never bothered funding it and so it’s just kind of sits there as a defunct document. Yeah what this would be a good thing for you to probably cover too, Alaina. What are some things I can do now to prepare my executor for their future role? Yeah. So the first thing that you can do definitely is to talk to them. You know, anytime that someone is going through that process of updating their documents, they’re thinking about naming new executor, new guardian, new trustee, anything like that. I always recommend that they take a few minutes, they reach out to that person, just say, “Hey, are you okay with this? You know, do you understand what this entails enough to actually think that you could be a good person to do this? Having that open and honest communication with your potential executor, I think, is key. Yeah. The other thing that you can do is you can have a really organized estate plan. You know, make sure all of your documents are in good shape. make sure that it’s been laid out who is going to have what role and then even you know that checklist that Joel showed earlier having something like that it’s not legally binding but it’s going to be of so much assistance to your person to your executor because they can go there and they can say oh my friend’s financial advisor is Joel Cundick I should probably give them a call in the event of an emergency My doctor is so and so, my lawyer is so and so, the password to my email is this and that. You know, having that sort of condensed information available to your executor can be a really big timesaver and can help make the administration of that estate substantially easier. Yeah, those are great ideas. I’ll add one more. I think that we tend to accumulate investment accounts over the course of our life like good friends and sometimes we just don’t want to close them out because it feels like we’re closing out a friendship. But in terms of administrating an estate, the best thing you could do for a future executor is collapse the number of accounts you have to less. I’ve dealt with helping people through estates of 20 25 different brokerage and bank accounts that there’s just so much administrative work related to that that kind of thing could have been easily simplified by collapsing. In life, it’s easier to handle these accounts than it is in death. And so at minimum, having all of your statements in one place so that everyone can kind of see what is, but probably at maximum simplifying the number of accounts you have all can be very helpful. I’m going to toss in one more little bit of realistic advice also and I try to remember to talk to our clients about this at our wealth transfer meetings but it’s something called a legacy contact in your phone. So this is available on iPhone on Android devices Google devices. Go ahead and Google it how to set one up on your phone. And what it does is it sends out a pin to whoever you choose. You can either text this to someone. You could send it. It sends automatically and says, “Hey, so and so, you’ve been named as a legacy contact. If there’s ever an emergency, here’s a pin that you can use to access the phone.” , and you can also print it out also and keep it with your estate planning documents because phones, big tech companies, you know, they are really hard to get into if you do not know that person’s password. Yeah and I’ve had a lot of really bad, really sad experiences with this where someone who passed away, their phone could not be accessed. And I think we all know that our phones are our lives. Not only does it have a lot of logistical information, but it’s also got so many photos, so much history, access to social media, all of that. And so setting up that legacy contact, making sure you’re nominated executor or successor trustee that they’re one of the people with access to your phone is really important, especially because, you know, you may write your phone password down here and there, but it changes. Sometimes you’ve got to update it. Sometimes there are other things out of your control. And just make sure somebody is named as that legacy contact for your phone. That’s great, great advice. I got something out of today. That was one I was not aware of, Alaina. And I’ll be setting up a legacy contact on my phone shortly. That’s great.  two, we’ll handle two more. I think we short questions. One is I’ve named my two children as co-executors. Is that a problem? That’s one I can weigh in and Alaina will see if you have anything to add. Not technically a problem. You are permitted to name multiple individuals as executor, as power of attorney, as power of attorney for healthcare. All those roles you can name co.  We were referring to that family harmony bit a little bit earlier.  You have to make sure anybody that you’re naming as co is going to have the highest probability possible of being in sync with each other because if you end up with disagreements between two different people, we’ve gotten to a much more complex situation than if only one has been named. And it’s not it’s not double the complexity, it’s probably triple, right? When we’ve got so technically you need to have in many cases when you’ve named two individuals two signatures on everything which you might like. You might like that kind of check and balance kind of concept, but you’ve also created the need for agreement, right? And agreement is not always easy to come by. So, I would just say oftentimes I think the simplicity is the better answer. Everybody’s family situation is going to be unique. Only you can know whether you need a situation with multiple individuals in those roles. But just contemplate the complexity you’re adding at what is already a very stressful time. Is there anything you’d add there, Alaina? There is one thing that I would also mention when you are naming two people in one role having those co-positions typically you have to decide whether they are going to be able to act called jointly or severally meaning is it going to take both of them to get everything done. Does every decision have to be made by both of them or do you want to give them each of the authority? So that can be good and bad by itself as well, right? So there is a lot to think about when it comes to naming co-agents, co-fiduciaries. Sometimes it does make sense, sometimes it might not be the best decision. Well, just to wrap it up, I want to make sure that we emphasize that sometimes we emotionally feel like we need to do certain things and I’d question those assumptions. You don’t necessarily need to do something too because you’re worried about how somebody will feel about being excluded from a role. I mean, what you need to do instead is communicate with them in advance about what a role is and what a headache it is and what we the reasons why you’ve named a single individual for something. It’s important to emphasize to our loved ones, I’m not indicating someone as a name because I love them more or less than someone else.  I’m just handling the administrative aspects of my financial life. Okay.  The last question I I’ll we’ll have time for today.  are there going to be any difficulties for my executor if they don’t live in my state? That one’s going to have to be you. That’s a little bit outside. Yeah, there can be.  some states they are required to have either an executor who lives in that state, resides in that state, has an address in that state or the executor has to hire an attorney in that state.  some states do not have any sort of requirement like that. But it really again that’s a very state based question. So, if you are working with your attorney, make sure you bring that up. Make sure you let them know, hey, you know, my executor is my buddy. They live in Virginia. We’re in Georgia. Is that going to work? Okay. You always want to make sure you run those questions by because it would be really unfortunate if your executor couldn’t act because of a problem like that that wasn’t thought through ahead of time. So definitely run by your attorney always. Whenever we’re dealing with multiple states, we want to just be more careful, right? If I hold assets in multiple states, this is a place I’m going to want to make sure I practice more carefully, right? Hey, what happens to that beach house that I have in Florida when I pass away because I’m doing probate in Virginia or I’m doing probate in Maryland. So just make sure you’ve thought through those complexities in advance as much as possible. I hope that what we’ve been able to communicate to you today, communication is key. Thinking about things in advance is key. Being asking good questions of good professionals is key in this process.  Again, if you’d like to line up some time to talk with someone at Savant, throw the click on the link that is available to you or visit our websitealth.com. It was a pleasure to be with all of you this afternoon. Thanks y’all. Have a good day. If you enjoyed this webinar, visit savantwealth.com/guides and download our complimentary guide books, checklists, and other useful financial resources.