MBMiner wrote:I know some will assume I'm biased, but I can assure you that most corporate fiduciaries do a much better job administering an estate than most individuals. Furthermore, it is almost always done more economically because the corporate entity has less need to draw on the lawyer's time and does most of the tax and accounting work in house instead of being farmed out to CPA's.
You need to rely on the quality of the institution and not so much the individual officers. Your family will not regret your decision to utilize a corporate personal representative.
CABob wrote:This might be a case where you should have a will and let the probate court take care of things after you pass. This doesn't seem like good advice in most cases, but, this might be the exception.
I would like to hear from others as to why it isn't a good idea.
MBMiner wrote:CABob wrote:This might be a case where you should have a will and let the probate court take care of things after you pass. This doesn't seem like good advice in most cases, but, this might be the exception.
I would like to hear from others as to why it isn't a good idea.
Not sure what you mean. Do you mean to have the court administer the estate? They will appoint a PR, possibly one not to your liking.
funnymoney wrote:...and I think bank trust departments are notorious -- for good reason. I could be wrong, but I am sticking to that position unless it's proven otherwise.
aquamarine wrote:But honestly, I've not known anyone else who has named a bank as an executor. Most people I know name their children or a relative. I don't expect any problems, but I wanted to get your feedback and collective wisdom and experience before signing on the dotted line.
Grandma wrote:.be aware that the bank legal department will also likely be taking fees from your estate in addition to the executor's compensation. The bank might be 'double-dipping'.
Just be certain you are aware of the ultimate costs.
JDCPAEsq wrote:PJStack - Although you are saying probate is not inexpensive, the fee is the same for a professional fiduciary or an individual. For the same price, why not hire the expertise, financial responsibility, continuity and group judgment of a corporate personal representative, i.e., a bank or trust company? Furthermore, a cororate executor is often cheaper because it does not have to hire others to do its work, because much of it is available in house. Managing an estate isn't a job for a novice.
MBMiner wrote:Also, the bank would have been financially responsible for such an error, whereas the "close family friend" might not be nor would you like to sue this person. Better a financially responsible corporate fiduciary. Everyone can tell you horror stories about bank trustees. I can tell you a few about individual trustees and when they mismanage a trust there's often no redress.
dratkinson wrote:To further our knowledge and as the OP has no children (applies to myself as well), who ensures the bank trust department faithfully discharges all of their duties?
aquamarine wrote:... gave us a good "sell" as to why you should name a bank as opposed to a relative as the executor of a will (banks don't "die"; banks are "professionals with experience"; relatives don't have to be boggled down with handling an estate when they are grieving, etc).
celia wrote:Surprise them by specifying 5% as their fee, before the rest is distributed. If the sale of real estate is involved, that can be very time-consuming, so they should be compensated somehow.
carolo wrote:And a question for Bruce, if I may...would a bank still handle assets held at Vanguard or would the bank want to use their own family of mutual funds? (I'm thinking in terms of incapacity at the moment rather than the bank just acting as trustee of the estate.)
I would prefer a close personal friend to act as the executor
Fbone wrote:I also am trying to do some estate planning. Everyone I asked to be my financial POA and executor has politely declined.
My attorney hasnt been helpful so far. The whole thing has been stressful and I finally understand why people dont bother with wills and leave the State to deal with it.
MBMiner wrote:Leaving the State to deal with it isn't the answer. You need a professional fiduciary, i.e., a bank or trust company. They are in the business of handling estates and do it well.
MBMiner wrote:I don't believe Credit Unions have trust powers, but there are banks and trust companies everywhere in the country that can serve in this capacity. Just because it is not offered by your bank is no reason to abandon the idea.
MBMiner wrote:carolo wrote:And a question for Bruce, if I may...would a bank still handle assets held at Vanguard or would the bank want to use their own family of mutual funds? (I'm thinking in terms of incapacity at the moment rather than the bank just acting as trustee of the estate.)
I'm probably not current on the position of all banks on this issue, but normally though the use of a living trust you can provide for your disability, and have investment direction in the trust agreement authorizing or directing the bank as trustee to invest in a certain way.
My experience has been that banks will reduce their fee on assets held in their own funds to offset the fee of the fund. They would probably discourage you from using outside funds because of duplication of fees between the trustee and Vanguard, but you could certainly do so if you wish. An attractive alternative might be to consider using Vanguard's Trust Company as trustee which would eliminate this problem.
MBMiner wrote:celia wrote:Surprise them by specifying 5% as their fee, before the rest is distributed. If the sale of real estate is involved, that can be very time-consuming, so they should be compensated somehow.
Celia - Your arguments for using an individual fiduciary are weak at best, so I won't attempt to respond. However, I submit you would do your friend a favor by leaving them 5% of the estate which would be nontaxable to them, rather than specifying a fee of 5% which would be fully subject to income tax. Impressed? See how those of us who have worked for corporate fiduciaries know our stuff? :lol:
MBMiner wrote:I'm still here and was surprised to see this old thread revived. It's not that Vanguard will not act as executor, but that they have no authority to do so in most states. It seems unfortunate to give up on the idea of Vanguard as trustee because you can't name them as executor. The duties of an executor usually take a year or two but the trust can go on for decades. There's no reason you couldn't use a local bank as the executor to liquidiate and distribute the estate and then Vanguard as the ongoing trustee. Also, if you used a revocable living trust you would essentially eliminate the duties of the executor and thereby solve your problem. This would be the better alternative in my view.