Appointing an Estate Administrator to handle your estate upon your death is a decision which should not be taken lightly. Most people appoint a loved one to handle their financial affairs and distribute assets to heirs. However, this may not be the best choice and much will depend on the family dynamics.
If the Estate Administrator is a family member, that person will be required to handle many duties while they are grieving. It can be extremely difficult to carry on estate administration duties if estate matters were not handled appropriately prior to your death.
First and foremost, it is important to appoint an Estate Administrator who is detail-oriented and possesses the ability to handle finances. The Administrator is usually responsible for making funeral arrangements; contacting government agencies such as Medicare and Social Security; taking inventory of financial assets and personal belongings; distribution of assets; and filing a final tax return.
When establishing estate planning, a Last Will and Testament should be executed. This is generally established by a probate attorney. A Will outlines directives of how you want your assets distributed.
The Estate Administrator is named within the Will. Experts suggest appointing two Administrators. If the first Administrator is unable or unwilling to perform duties, the second named Estate Executor can step into the position without the need for authorization from the probate court.
Upon your death, everything you own will be placed into probate. This ensures directives of your Will are followed and all outstanding debts are paid. The probate process generally takes six to nine months to settle. However, if family disputes arise and heirs contest the Will, probate can drag on for several years.
In the event you do not execute a Will prior to your death, a probate judge will appoint a probate executor to administer your estate. This may or may not be a relative and chances are good your assets will not be distributed the way you wanted. Therefore, it is extremely important to implement a Will in order to ensure your loved ones will receive the items you want them to have.
Estate Administrators are entitled to receive compensation for services rendered. Administrators can charge an hourly rate, flat fee, or percentage of the estate. Although many relatives feel awkward charging a fee to handle their loved ones estate, it is important to realize closing an estate requires considerable time and effort.
Estate administration generally requires 10 to 20 hours per week for several weeks to sort out paperwork, inventory assets, maintain real estate, and work with probate or estate planning lawyers.
Individuals appointed to the position of Estate Administrator can choose to be removed from their position if they are unable to perform duties. A probate judge will designate another family member or outsider to manage the estate if necessary. Additionally, the family can hire a professional estate administrator if no one is available to fill the position. If a professional estate administrator is hired, the estate is responsible for paying the fee for services rendered.
Estate planning is an integral part of ensuring your family receives the assets you have worked so hard to obtain. We invite you to learn more about estate planning, inheritance, establishing a Will, and appointing an Estate Administrator in our life planning article database.
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