ACCOUNT ACCESS

Estate Administration

Estate planning is a complicated process. The success of your estate planning and administration depends largely upon the professionals you select to develop that plan and the individuals who will act as personal representatives or trustees.

One of the primary aims of preparing your estate plan is to make sure your family is secure. A very important purpose of your will is to name a Personal Representative. (The older term for personal representative is executor.) A personal representative or "PR" is the individual nominated in your Last Will & Testament by you and ultimately authorized by the probate court to settle your estate. The reason that individual is nominated is because no one is legally able to perform the duties of a personal representative until a court of proper jurisdiction has approved the nomination and Letters Testamentary (or Letters of Administration) have been issued. Letters Testamentary is the proof to all that the personal representative has the authority to do whatever is necessary to settle the estate.

The importance of your choice for a personal representative cannot be overstated. The PR must be someone you have complete trust and confidence in as he or she will be acting on your behalf to carry out your last wishes with care and sensitivity.

A PR is charged by the court to marshal all of your assets together, complete an inventory, establish a current market value for your assets, handle real estate matters, collect debts, interest and dividends. He or she will pay federal and state income and (if necessary) estate taxes, pay final expenses, deal with business issues and in due course, distribute your estate to its rightful heirs. All these activities are subject to court approval. And if that is not enough, fiduciary law applies to individual or family member PRs just as it does to corporate and professional PRs or trustees. Few individuals are aware of the full spectrum of the responsibilities they are obligated to comply with nor are they familiar with the potential liability they face when they fail to comply. In today's multiple family, mixed marriage environment these concerns are magnified.

Some people believe it is an honor to name a relative or friend to serve as a PR. In reality, it is a commitment that is time consuming and often difficult. Unless an individual has settled estates before, their inexperience will be costly to your estate both in terms of money and efficiency. An individual may not consider your estate settlement a top priority and the person you name may not be willing or able to serve when the time comes. In addition your friends, who are your peers, may become physically or mentally incapacitated.

Consider naming a corporate fiduciary such as Family Heritage Trust Company as your Personal Representative. When a corporate PR is named you can rest assured that such nominee will be available and experienced, and will be impartial to all beneficiaries. A corporate PR will avoid costly errors thereby leading to an increase in the value of assets to be transferred to your heirs.