Many people start the estate planning process simply by looking at their assets. Maybe they have family heirlooms, and they know they want to leave them to specific people, so they begin writing a will. Perhaps they have significant financial assets, so they set up a trust that helps them determine what should happen to these assets after they pass away.
All that is important, but it’s not just about assets. You also have to consider debts and taxes. When you pass away, you’re likely still going to owe debt on credit cards or for unpaid utility bills, for instance. You’re also going to have to pay property taxes and income taxes for the year, just to name a few examples. There are a lot of different financial debts that have to be taken care of. Who’s in charge of doing this?
You choose an estate executor
To determine who’s going to do this, you simply have to pick an estate administrator or an estate executor. This individual is responsible for paying back the debts, paying off the taxes, taking account of your assets, helping to distribute those assets and generally just ensuring that your estate plan is followed.
Don’t worry about giving this person any sort of financial obligation themselves. If your estate doesn’t have the money to pay off the taxes or the debts, then they can often remain unpaid. You’re not telling the estate executor that they are personally going to be responsible. You’re just giving them the authority to use the assets that you leave behind to take care of the debts that still exist.
As you make your estate plan, carefully consider all of the legal options at your disposal.