Estate administration can be an extremely challenging and time-consuming process. There are several ways you can make this process much easier for your executor. I have outlined my five top tips below!
1. Make sure your executor wants to be your executor.
It may be helpful to have a conversation with the person you have in mind to be your executor. You can outline what the role will entail and ask if they are willing to take this responsibility on. This person will have the authority to deal with your affairs and will need to do the following:
- register the death;
- arrange the funeral (normally in close discussion with the family);
- value the estate;
- sort out the finances;
- deal with any assets;
- pay any inheritance tax and report the estate to HMRC;
- apply for probate; and
- distribute the estate
As you can see there is a lot of work to be done which is why it is incredibly important that your executor is dedicated to taking on this role. Your executor can be someone who will inherit under your Will. In fact, it is common practice to appoint a spouse, child or other family member as an executor. You can appoint up to four executors but they must act jointly. It is therefore important to consider whether it is practical to appoint who you have in mind.
As this can be such a demanding job many people may choose to appoint a professional executor to handle all or some of the work required after someone passes away. They provide specialist expertise and professional impartiality.
2. Tell your executor where your Will is!
This may seem obvious but many people simply forget to tell their executor where their Will is! The first step of estate administration is to locate the current original Will. You may have locked this away in a safe place or it may be in the safekeeping of the law firm who prepared it. Either way, tell your executor! If your executor cannot locate your Will this will make the process much harder for them.
3. Make a list of your current assets and assemble a list of debts.
List of assets
A key step in the estate administration process is to ascertain the assets and liabilities of the estate at the date of death and their values. If you make a list of all of your current assets and keep this with your Will this can help your executor tremendously. This list can include the following:
- property interests;
- bank accounts;
- investments / shares;
- personal possessions;
- pensions; and
- insurance schemes
This asset list will help your executor understand what assets exist that need to be collected in, reported to HMRC (if an inheritance tax return is required) and subsequently distributed. Having the necessary information will make the process much easier for them and avoid assets being overlooked and the estate having to be reopened in the future as and when further assets come to light.
List of debts
This can be a separate list from your assets for open credit cards and other obligations you may have. When you pass away your executor will need to contact the creditors to make arrangements to pay off the debts if they haven’t already made a claim on the estate. An example of this could be an overdraft on your account or a credit agreement that has not been paid off.
4. Keep a list of gifts
Gifts made within seven years of death can affect the inheritance tax due. It is often quite difficult to work out what gifts the deceased has made in their lifetime, so if you keep a list of gifts with your Will, it will save your executor a lot of time. It would be helpful if you record the following:
- the asset you gifted;
- the donee;
- the value; and
- the date
5. Regularly review your documents
We generally recommend that clients review their Will for updates every two to three years and after any major life-changing events. Changes in your personal life, financial position or even in the law can often mean that changing your Will is necessary in order to guarantee that it best reflects your wishes.
"It's a complicated job even on quite simple estates, and will typically eat up several months of your time"