While deciding how to distribute your assets to your loved ones after your death, you also have to choose someone to be the executor of your estate. Your executor will make sure that your heirs receive their inheritance, so you want someone you can trust. In your case, you may want one of your heirs to also be your executor.
You might wonder if it is possible for a beneficiary to also be an executor. According to Smart Asset, the answer is yes. In fact, many families name a beneficiary to serve as executor. In some cases, though, there are downsides to this kind of decision.
Potential problems
Some families experience issues when an heir is also an executor. Sometimes a family member does not have the necessary skills to run an estate and/or does not ask professionals for help. Also, since the executor was likely close to the decedent, the executor may be mourning with the rest of the beneficiaries and cannot focus on the estate.
Sometimes being a beneficiary and an executor creates conflicts of interest. Creditors may come after your estate for unpaid debts. Your executor has the responsibility of paying the debts with your estate assets. However, your executor also stands to benefit from your estate. Sometimes executors in this situation deprive other beneficiaries of assets in paying off creditors while pocketing their full inheritance.
Possible benefits
Having one of your heirs act as an executor may still work out for your family. Your executor pick is probably someone close to you and wants your estate plans to succeed. Your executor should have a simpler time locating and contacting all the other beneficiaries of your estate. Your executor probably knows you well or you are easily able to talk with your executor about where your assets are.
Given the possible outcomes of having a beneficiary act as your executor, it is important to consider whether your family is more likely to reap the benefits of such a choice as opposed to the drawbacks. No matter your decision, be sure that your executor has the competence and ethical standards to administer your estate.
