Your estate plan may name several different fiduciaries, including an Executor, Trustee, or Agent under a Power of Attorney. While these roles have different responsibilities, they all involve a high level of trust and responsibility. Choosing the right person for these roles is an important part of creating an effective estate plan
The Role of an Executor
An Executor is a person named in a Will who has the job of administering the decedent’s estate. The Executor’s job is generally to carry out the instructions in the Will and handle the legal and financial matters necessary to settle the estate. Being named as an Executor means taking on the responsibility of managing the decedent’s estate and making sure their wishes are properly carried out. When choosing who to name as your Executor, you should consider your individual circumstances, family dynamics, the complexity of your estate, and the person you trust to handle financial and legal responsibilities. It is also important to consider the relationship between your potential Executor and your named beneficiaries. If family conflict is likely to arise, choosing someone who can remain neutral and avoid unnecessary complications would be best. Under Illinois law, a person serving as an Executor must meet the legal requirements to serve and be formally appointed by the probate court before they can act. Illinois law permits certain estates to be administered independently, which can allow an Executor to administer the estate without court supervision.
The Role of a Trustee
A Trustee is responsible for managing property held in a trust and administering that trust according to its terms. A Trustee may have responsibilities during a person’s lifetime, after death, or both, depending on the type of trust involved. A Trustee must follow the terms of the trust and comply with applicable fiduciary duties. This means that someone who is comfortable managing money, keeping records, and following detailed instructions may be well suited for the role. Under Illinois law, a Trustee must administer the trust in good faith and in accordance with its purposes, terms, and the law. The Trustee also has duties of loyalty, impartiality, and prudent administration. A Trustee must keep adequate records and keep trust property separate from the Trustee’s own property.
The Role of an Agent under a Power of Attorney
A Power of Attorney allows a person to designate an Agent to act on their behalf in certain circumstances. The responsibilities of an Agent depend on the type and scope of the Power of Attorney. For example, an Agent under a Financial Power of Attorney may be authorized to handle financial and property matters, while an Agent under a Healthcare Power of Attorney may be authorized to make medical decisions. Importantly, an Agent is acting for the benefit of the person who created the Power of Attorney, not for the Agent’s own benefit. Illinois law states that the Agent must act in good faith and must use due care, competence, and diligence. The Agent is required to maintain records of receipts, disbursements, and significant actions taken.
Although the responsibilities of an Executor, Trustee, and Agent are different, each role involves an important legal relationship built on trust. The person serving in the role is handling someone else’s property, financial affairs, or estate and must follow the governing documents and applicable law. This is why choosing someone who is trustworthy, responsible, organized, and capable of following through on important obligations is so important.