Seems like you want the executor to be scrupulously fair and honest, and seen as such by all heirs. That would presumably be even more important if the executor is also an heir.
The executor also has to be willing and capable (including not being overburdened by the executor’s work in addition to whatever else they have to do) of doing the work, and doing it properly.
Another data point here: be wary of an independent executor/trustee. Be sure to really investigate them before allowing them to serve.
My mom set her trust up with one, and the trustee (and associated lawyer) were not responsive or honest with my siblings and me at any step along the way. And, after the fact, I was able to find information online that, if my mom had known about, she most likely would have chosen someone else. We saw some of the same behavior that ended this particular trustee in court before.
We have emails from the lawyer that contradict themselves - one to the next. Yes, they did take care of dealing with her house and a out of state house - both sold at a likely large discount due to poor/no advertising/a realtor with no local track record.
And it took another lawyer, and a little over three years to replace them with a bank trustee - who has been responsive and up front with us.
I’m not saying that what we have is a perfect solution, but having someone who responds to queries and access to daily accounting information is invaluable.
My brother and I were named as executors of my mother’s will. He signed a paper saying that he yielded his rights to me.
We named both D’s as coexecutors. They can do the same. I really did not want to choose one over the other and have hard feelings by them. Otherwise H and I are executors if one survives.
I have three executive functions in my Estate documents: Executor, Power of Attorney, Health Care Proxy. I have named each of my three children as one of these, a different child as the alternate, then the third child as the 2nd alternate. This should cover any situation where someone is incapacitated to fulfill their primary (or secondary) role or predeceases me. Each child has a primary, secondary and tertiary obligation for those executive functions.
I wonder now how to designate funds I might want to go to my siblings and/or nieces/nephews. I was advised not to designate a dollar amount as that would be funded first and may impact what is left for my kids. I could identify a percentage amount, but wonder if I should create a bank account with sibs/their offspring as beneficiaries.
Thoughts?
The trustee/executor whomever you pick, should 100% be someone you trust no matter what. I am seriously considering naming one of my children down the line as my executor but she’s only 20 and right now I don’t trust that she wouldn’t blab my business to her father (or later) so I am not ready. In the interim my plan is to name one of my siblings.
If you want control over how it’s distributed, you just put in there the provision of when the trusts should be distributed to the beneficiaries. Normally a lawyer will tell you when the typical ages are that trusts are distributed based on age, but some people because they prefer to control from the grave, or want set distributions, or distributions to be made for certain reasons only (ie education purposes for heirs, medical, etc) put in other provisions. You can really do whatever you want. A lot of trusts usually have two trustees also, to avoid one person running off with the money or taking it for themselves. So in other words, it could require two siblings where one is the benefciary and then a successor beneficiary is named if one dies, stuff like that.
If someone has special needs that you need to make sure their needs are met when you’re gone then you would want a special needs trust drafted.
To reiterate what I said previously, try to avoid a bank at all costs, and as someone else just said above, do not just use some random lawyer either. They will gouge you and charge some ridiculous fee for doing this. You can name a friend you trust or family member if you don’t want to name a child, but most as they get older do name children.
At the time your will is done, most lawyers do living trust, HCPOA, and PPOA. That said, depending on your state, some PPOA and HCPOA do not allow successors to be named. You can however list this in your will.
@mominva Funny you ask that because I have said the same thing to my husband about set dollar amounts if his mom did that to his kids yet the rest of her money ran out would that have to be paid first and he said yes. It’s not happening so not an issue. If money is not an issue it can be done and is commonly done. My grandma did that with us and I had some great aunts that did as well. You can also take your retirement account and make them beneficiaries and allocate a percentage of that or set dollar amount. Setting up a new account in the manner you said, just seems overly complicated, but you can always do it and just make them beneficiaries. It shouldn’t impact your kids unless your kids fight it and don’t want the nieces or nephews to have it. If you have plenty to give, I would leave add the amount to your plans. If your assets change or ability to leave them anything changes, you can always change the amount or eliminate them.
A few years ago wrote simple wills at a community class (with lawyer and notary). We had intended to name our 2 grown children as co-executors, but they highly discouraged naming multiple. So we picked the older one, who also happens to be local.
Last year we considered writing trusts, a free service with our financial planner. But we did not know who would be a good trustee, and we did not know if/how we’d want to meter out the funds. So for now we just kept our will. However, almost all of our assets already have co-owner and/or beneficiary defined as spouse, with children as 50/50 alternate beneficaries (in case we die together or before survivor has chance to update paperwork… a common situation). Only our house and contents would go through probate, and it’s likely we’ll move elsewhere in older age.
Just an FYI… Some states have TODDs -Transfer on Death Deed for RE that allows RE to pass to the beneficiary outside of probate. Check if your state has such an option. It might be worth it for any RE you plan to pass to your future heirs. Also, keep in mind that RE goes through probate in the state it is located… something to keep in mind if you have a vacation home in another state. Consult your estate planning attorney! 
I disagree.
My parents named one of my siblings. Guess what happened? Read the above quote. Sometimes you do not know your child as well as you think. In addition to an ongoing legal battle this has resulted in irreparable damage within our family.
Most of you are married for over 20+ years and are planning your golden years. One thing to remember is to make sure it is both of your financial goal, not just your goal. You don’t want it to be a source of resentment between you and your partner.
It is nice to want to give money to one’s children and grandchildren, but your kids may prefer their parent to be happy rather than staying at a job they hate. I see some parents who work pass their retirements because they still want to help out their adult children.
Would love some thoughts as you all are much more versed in the finite details of long term and college planning!
I have a freshman in college and a junior in HS. Currently fully funding my husbands 401K, and stashing about 5k per kid annually into their 529’s. (husband will have a significant pension and health benefits if he stays 14 years which is the plan)
I am a consultant and have had a sep IRA For years but with non deductible contributions since 2018. What’s the best thing for me to do with that 6k annually? Continue contributing knowing it’s non deductible? Fund the kids 529s? Just use as cash to pay tuition? Would love some ideas.
In California there is a third choice - professional fiduciaries. They are licensed by the state to act as trustees, etc.
Banks don’t always want to take the job if the estate isn’t big enough, and can be quite expensive and impersonal. So it is nice to have another option.
@tumagmom It really depends a lot on your income, how much you already have saved, how much of your kids education you plan to pay and what are your plans long term and short term.
If you are high income and can squeeze the college payments you need out of annual income then putting money into a 529 might not make sense. ( Check those 529s to see what their annual costs are, ours were 5% load. That was absurd. AND, the money was far worse than what we ever made outside in stocks). Yes, I know that taxes matter but with the small earnings we could have bought other vehicles. YMMV. If you use 529s for little kids and save regularly I think they can be a great tool. We started by using UTMAs. For us 529’s were not the major college savings tool ( I actually have used them to pay for private tuition since I hated their fees).
Another thing to think about is having your child work for you since you are self employed. There are numerous benefits. Don’t know if it would work or not.
If you plan to borrow for college, that’s a lot different than maybe contributing less into your 401K/Sep. Or maybe you can do both! Also, you have to look at overlap years. For us, we’ll have two kids in college for two years. Overlap years are of course more difficult if you are paying out of your annual salary.
I’d make a list of what your expected college costs are and in which years and then figure out a plan to pay for it (or part of it). A financial advisor can help ( even if it’s on an hourly fee basis). Sometime good vehicles for paying for tuition get overlooked (like UTMA’s or even buying stocks for this purpose). One of my spouse’s family borrowed college costs in a Heloc against their home. That seemed extremely risky to all of us. But people have different needs and approaches.
There are lots of ways to save and pay for college.
New York 529 plans offer some of the lowest fees of any direct-sold 529 college savings plans.
The total asset-based expense ratio for the direct-sold New York Saves 529 plan portfolios are a flat 0.13%.
That’s awesome. Our Fin planner used a Fidelity one. The load was 5%. No way I was going to pay that to save $. We ended up changing our vehicle.
Some states have really good 529 plans. Not all states do, sadly. Some are deductible for instate residents some aren’t. There were a lot of variables. I wanted to use 529’s. But they weren’t the bet vehicle for us.
Thank you! We really do need a FA I just keep putting it off. Rollover ITA for hubby, work 401K, pension, my IRA, kids 529s and money markets I’m not sure what is what!! I feel comfortable we’re doing all we can for retirement. I keep hearing my father in my ear that you can fund the kids college and pay for it later, you can’t borrow for retirement lol! Best thing he ever did was make me put 16% of my pay away from my first real job and evermore.
We do plan to pay all of their schooling with cash flow, 529 (started both at age 3) and with loans from family at a very generous interest rate. Kids will take the fed unsub loans to help build their credit, and we’ll likely help pay them on the back end.
I know there are many ways to skin this cat. I’ve been so focused on just saving.saving.saving and not so focused on what we do now that we need the money. Husband and I are 45 and 44 respectively so most of our friends aren’t in this boat yet. It helps to read others experiences to learn more!
You are young and have great savings. That’s excellent. When you find a good financial planner they will lay out the various options rather than choosing for you.
We usually look at big purchases in terms of what are our current assets ( and income) and what are the options. Then I factor in taxes. Sometimes the taxes make the decision obvious.
We named our kids as executors of our wills if we both die. Though it seems to be a common sentiment just to name one person, since everything goes to them equally (and they have been directed that if there’s one extra penny to throw it away or split it), I’m not sure how much can go wrong. They have never argued and are very respectful of each other, so I trust them.
Yes, but please do a deep background review of said professional. The person who was in charge of my mom’s estate/trust was/is a professional fiduciary - even active in a local professional group. There were still flags in their past history, and with the handling of my mom’s estate/trust.
I think a single executor is logistically simpler. I say that after having settled my mother’s estate last year. She had many small assets, most with beneficiaries assigned (Thank You, Mom!). But for a few things I needed legal authority. I was in frequent contact and agreement with my sister (1000 miles away), but she did not need to go to the courthouse with me when I filed the will.
I found this article
My in laws named a bank trustee as the executor of their estate, after each other. We don’t have to do a thing. Yes, we’ll pay for it (out of the estate), but I can pretty much guarantee my SIL’s H would be trying to screw H over if he could. This way, he won’t even try.