I don鈥檛 want to burden my family with being my executor. Can I hire someone?
It鈥檚 a bit of work being an executor. This is an incomplete list:
- Arranging for the disposal of remains and funeral services,
- Identifying and securing cash, jewellery, artwork and other valuable,
- Ensuring pets are looked after and rehomed,
- Clearing out fridges and freezers and securing the residence, ensuring insurance is in place,
- Secure computer, e-mail, social media and other online accounts,
- Ensuring property taxes and other home related bills are paid,
- Ensuring that vehicles are properly insured,
- Identifying mortgage, credit card and other creditors and ensure accounts are kept in good standing and that interest expense is minimized,
- Redirect mail, and deal with the incoming mail,
- Preparing a complete inventory of assets and their values, arranging appraisals as appropriate,
- Working with financial institutions to obtain account particulars and amounts,
- If applicable, arranging for interim management of a business,
- Ensure investments are managed,
- Keep and maintain records and an accounting of all these steps,
- Search the deceased鈥檚 home, safe deposit box, computer and anywhere else to identify any written (digital included) indication of their testamentary intentions, whether that be a formal will or informal document,
- Engage/instruct a lawyer for applying for probate and provide information/documentation,
- Tracking down beneficiaries as well as others who need to be notified about probate,
- Engaging/instructing a real estate agent for the sale of property, and engage/instruct a lawyer for the real estate transaction, and
- Keeping beneficiaries informed and dealing with allocation and division of the estate along with conflicts that can arise between beneficiaries.
Some people are really organized, ensuring that their affairs are in order. Others, not so much.
Some estates are very simple, consisting only of minimal value household furnishings and investment accounts. Others are very complex.
The work of executor can be relatively minimal. It can also be a part-time job.
If you have children, it鈥檚 common to name one of them as your executor. How many of your children could reasonably add a part-time job to their lives?
Keep in mind that it鈥檚 a job they are unlikely to have any experience taking on.
They might have trouble managing their own lives and finances, let alone being suddenly saddled with a whole host of administrative functions they have no familiarity with on top of managing yours.
If you don鈥檛 have children to name as your executor, there鈥檚 an added level of complexity. Children are likely to be at least somewhat familiar with your affairs. Not so much if it鈥檚 a sibling or friend.
Finally answering the question posed at the beginning of this column, yes you can hire someone to be your executor.
But it will cost you handsomely.
Correction. It won鈥檛 cost you a dime. You鈥檒l be dead. The cost of a professional executor will come out of your estate, reducing the amounts received by your beneficiaries.
I鈥檝e spoken with representatives of two major banks. I鈥檓 going to share with you my understanding of the cost of their executor services without naming the banks. Please note that the fee structures get complex so if you have any interest in a corporate executor you should talk directly to a bank representative.
There are minimum executor fees. For one bank it鈥檚 $25,000.00. The other is $20,000.00.
But when looking at the numbers, those minimums are unlikely to apply.
Let鈥檚 take a $2 Million estate, 50% of which is an average home in 琉璃神社, the balance being investments.
The one bank would charge 4.25% on the 1st million and 3.25% on the 2nd, for a total of $75,000.00.
For the other, it would be 4.5% on the 1st and 3.5% on the 2nd, for a total of $80,000.00.
Each of them offer executor fee discounts on investment assets that were held in their accounts, providing strong encouragement to the testator to invest with them. The discounts are 15% and 20% respectively for investments under $2 million, the discounts not applying to the total executor fee but to the fee attributed to those investments.
On top of those executor fees, there are fees for actually administering the assets, which for each of the two banks would amount to at least another $15,000.00 given our scenario.
That鈥檚 exquisitely high pay for a part-time, largely administrative job, even on the more complex end of the scale!
Does professional executor work come any cheaper?
You can enter whatever deal that you and your chosen executor agree on.
One of the banks specifically invited a discussion with a potential client for the purpose of negotiating fees.
I know that many lawyers will agree to act as executor and I suspect there is a wide range of fee arrangements available.
I would think that accountants, bookkeepers, financial planners and many others would make suitable executors and might agree to enter into a reasonable compensation agreement with you to act as yours.
But whoever you enter into a deal with is going to want to make money 鈥� money that one of your beneficiaries might well prefer to avoid paying out of your estate so that more proceeds go to the beneficiaries.
In a future column I鈥檒l write about fees that executors can claim even if there isn鈥檛 a specific fee agreement made in advance.
Paul Hergott
Lawyer Paul Hergott began writing as a columnist in January 2007. Achieving Justice, based on Paul鈥檚 personal injury practice at the time, focused on injury claims and road safety. It was published weekly for 13 陆 years until July 2020, when his busy legal practice no longer left time for writing.
Paul was able to pick up writing again in January 2024, After transitioning his practice to estate administration and management.
Paul鈥檚 intention is to write primarily about end of life and estate related matters, but he is very easily distracted by other topics.
You are encouraged to contact Paul directly at paul@hlaw.ca with legal questions and issues you would like him to write about.
