Choosing Executors when no family - not a bank, that's for sure!

ramagel

Tortoise wrote: »

Charge for their services was £32,310.02 plus VAT (taken out of the estate after inheritance tax is paid)...

This is a horror story!

What can you do if you don't expect any suitable family members still to be living when you need an executor?

I don't suppose a solicitor is any cheaper than a bank.

We've an even bigger problem than poor old Tortoise as we want to leave money in trust for my wife's American grandchildren.

Any tips?

dzug

Solicitors tend to be cheaper than banks and more likely to charge by the hour rather than a % fee - but still not cheap. They can also be more amenable to you doing some of the more mundane work.

It can be difficult not appointing a professional executor if you think there is no-one suitable - but you can spread the net quite widely - a relative in the younger generation is best, or a (younger) family friend, or a beneficiary or two. They always have the option of getting professional help if they feel not up to task, but are not obliged to

geordie_joe

My boss was an executor, he had to go somewhere and be interviewed to see if he was suitable/capable of doing it, but he said it wasn't too bad.

A mate was left £6,000 by a relative over three years ago and the local solicitor was the executor. He still hasn't got the money and every time he phones the solicitor is either on holiday, in a meeting or otherwise engaged.

After watching his efforts to get get his money, and failing, I would never appoint a solicitor as executor. This one is just hanging onto the money as long as possible to get the interest.

Debt_Free_Chick

ramagel wrote: »

This is a horror story!

Although the total fee (at £32k) was only about 2.5% of the total estate (about £1.3m)

And you get the services of an experienced professional. For lay-people, being an executor can be stressful and without professional help, you can be left with some very difficult situations - like like this one.

If a difficult situation arises and the executor needs legal advice, the cost will come out of the estate, anyway - so you think you're saving on the one hand, but it gets taken away!

If you're not going to use a professional executor, then be sure you get professional advice when writing your will. The combination of no advice for will-writing and an executor with no experience could result in your precise intentions not being carried out.

We've an even bigger problem than poor old Tortoise as we want to leave money in trust for my wife's American grandchildren

Do you really? If you left the money to the grandchildren's parents, for them to use "for the benefit of the grandchildren" do you have any doubts that they would do that? That sounds rather aggressive and it's not meant to be, at all. I guess I'm saying ..... if you give money to someone and say "Use that money in the best way for your children" most parents would do just that. It would be pretty shoddy for a parent to ignore their own child's needs and simply go on a personal spending spree - although some would, I guess :rolleyes:

A professional executor also has the benefit of being independent. In the post referred to above, the poor executor is no doubt feeling somewhat restricted in the way they deal with the beneficiary of the will as she's the executor's niece (and clearly taking the !!!!!!, if you look at this later thread)

There is much to think about - the way you structure the will; the need for the executor to have professional advice etc .... sometimes, it ain't simply down to the money.

Often, you get what you pay for

HTH

ramagel

Debt_Free_Chick wrote: »

A
Do you really? If you left the money to the grandchildren's parents, for them to use "for the benefit of the grandchildren" do you have any doubts that they would do that?

There is, emmm, a certain history of financial irresponsibility .... and of being cajoled into inappropriate decision by others .... No offence taken

dzug

geordie_joe wrote: »

After watching his efforts to get get his money, and failing, I would never appoint a solicitor as executor. This one is just hanging onto the money as long as possible to get the interest.

The solicitor doesn't get the interest - it gets paid to your mate when he finally gets the bequest.

Debt_Free_Chick

Just beware that trusts can present huge problems.

I work with Trustees of pension schemes and one of things they do is to distribute lump sums payable on death - substantial lump sums ranging from 4 to 10 times salary! And this is for a "financial services" company in the City - so salary can be a HUGE amount

We are currently in a pickle with a trust that was set up in the past. Bloke dies, £0.5m lump sum, widow & kids. Expression of Wish form asked the trustees to consider payment to kids (under age 8), so trustees set up a trust.

Widow left with no money to raise kids - asks for a payment from the trust to continue to pay school fees ... no can do! Asks for a payment from the trust to pay for school uniform .... no can do! The list is endless. I hasten to add that the pension scheme trustees are not the trustees of the separate trust (neither is the widow!). The trustees of the trust can only distribute the income to the children, as beneficiaries of the trust, not the capital. They pay the income into bank accounts in the children's names and their mother can't get at the money - even to use for their benefit!!!

So be very, very careful. What has been created in my example is a windfall pot of money for the kids to have when they reach age 25. Before then, they get the income (interest, effectively) from investment of the lump sum. So nothing is available to help their mother raise, clothe and feed them during childhood. And they get a lump sum when they get to age 25 - to spend on a drink and/or drug fuelled orgy, should they so wish.

So .... be very careful about how you create the trust and who you appoint as trustees. You MUST get professional advice. This is not as simple as it sounds.

The good news is that the "bad" example I gave above can be avoided, but for heaven's sake (or rather, the children's sake) get proper advice.

HTH

geordie_joe

dzug wrote: »

The solicitor doesn't get the interest - it gets paid to your mate when he finally gets the bequest.

So why is he hanging onto the money, surely it doesn't take 3 years to sort a bank account out and sell a house!

We know that he is just keeping them hanging on as one day he rang him and was told he was on holiday for two weeks. I rang later and said I wanted to see him about buying a house and was told to "pop in this afternoon and he'll see you."

ramagel

Debt_Free_Chick wrote: »

JThe good news is that the "bad" example I gave above can be avoided, but for heaven's sake (or rather, the children's sake) get proper advice.

Indeed. This is not a job for a DIY will or for a Will Writer (no matter how much they might protest!). We shall consult a solicitor* accordingly to write the will and trust (which would already include a provision for the necessary familial expenses to be met to provide a suitable environment as well as providing for the education of the child - whihc in the US is jolly costly!),

It's not so much that that's the problem, it's finding the best combination of executor and - now you mention it as I had conflated the two as one - trustee(s).

Well we've a year or two yet! But the problem is not having any family members who are (or will be) capable to act as executor and/or trustee. It may end up being the case that we sacrifice our desire for control (of how the monies are spent) to save ridiculous sums on transatlantic-competent professionals!

Debt_Free_Chick

ramagel wrote: »

It may end up being the case that we sacrifice our desire for control (of how the monies are spent) to save ridiculous sums on transatlantic-competent professionals!

Sometimes .... just sometimes .... It's worth it

Murdina

Debt free chick I'm gobsmacked by your comments about the children above. I've acted for family trusts in the past and the income payable to the kids was typically used to pay for the school fees and/or other expenses which were clearly for the children (yes capital is a different matter). If I were the mother I would borrow the money to take counsel's opinion as to whether this is right or not. I've also dealt with at least one bank whose trust department was pretty weak on understanding the law of trusts.
Returning to the original question, there is nothing to stop executors appointing solicitors to help them - it just means that the estate does not have to fund hefty fees per se for the solicitor being executor. Banks are the worst in my experience.