Personal Finance: Ask the Experts

Get advice on money matters from The Bee's Claudia Buck and a panel of local experts

November 1, 2012
Who should we name as our trust executor?

Q: We need to find a reputable executor for our trust. We don't have any relatives nearby that we would like to name. We have friends we trust but they are older like us and may find the chore too difficult. Who might we hire and what are the usual costs involved? Thank you. -- Marlene, Elk Grove, CA

A: In your situation, I recommend you consider naming a private fiduciary or a trust company to serve as the successor trustee of your trust and the executor of your will. These individuals and institutions are experienced in the issues that arise during a trust administration.

You could also ask a trusted advisor, such as a trusted accountant. However, you would need to confirm that the accountant or other advisor is familiar with trust issues, is willing to serve as your successor trustee and executor, and has considered their own succession plan in the event they become unable to serve and you need an alternate to serve. Note that persons other than private fiduciaries and trust officers are not generally bonded.

Trust companies are institutions that have developed an expertise in the management of trust funds and the performance of all other tasks related to properly administering a trust estate. They are often affiliated with banks or brokerage houses.

You should interview the trust officers of various institutions to find out about their company's minimum estate or trust size requirements, the qualifications of the personnel, and their internal policies on dealing with your loved ones as trust beneficiaries.

Private fiduciaries are individuals who are licensed by the state, and they can serve in a variety of capacities - as executor, trustee, or even as an attorney-in-fact or agent under a durable power of attorney or advance health care directive. Inquire about their personal succession plan, in case someone is needed to fill their position for your trust or estate.

There are many private qualified fiduciaries in the Sacramento region. I would consult your trusted advisors about persons they have worked with successfully in the past. I recommend that you meet several private fiduciaries, as well as trust officers at trust companies, to ensure that you find a situation with which you are comfortable.

Costs for private fiduciaries and trust companies serving as executor and/or trustee vary, so include this topic in your interview questions. Many trust companies charge annually a percentage of the total value of the trust, often around 1%. Private fiduciaries may charge hourly or a percentage rate, depending on the role in which they are serving. It is my impression that experienced private fiduciaries charge anywhere from $75 to $125 per hour or more in our area.

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Meet Our Financial Experts

Claudia Buck

Claudia Buck is The Sacramento Bee's personal finance columnist. Read all her columns here. Contact her at cbuck@sacbee.com

Terri Carpenter

Terri Carpenter offers advice on job hunting, retraining and career counseling. Carpenter works at Sacramento Works Inc., the career and job training arm of the Sacramento Employment and Training Agency (SETA). With 15 years in the field, she has hands-on experience with everyone from first-time job seekers to career professionals seeking advice after a layoff or looking for a mid-career change. Ask her a question.

Carlena Tapella

Carlena Tapella is a partner in the law firm of Webb & Tapella Law Corp. in Sacramento. The firm specializes in estate planning and probate, such as estates, trusts, conservatorships and litigation. She is a past president of the Sacramento County Bar Association's Estate Planning & Probate Section. Ask her a question.

Kimberly Foss

Kimberly Foss, certified financial planner, is the founder of Empyrion Wealth Management in Roseville. With nearly 30 years in the financial industry, her clients include women in transition, small business owners, retirees and "pre-retirees." Ask her a question.

Jesse Weller

Gregory Burke, a CPA and tax expert with John Waddell & Co. in Sacramento since 1984, worked as an IRS tax auditor for six years. He’s a past chairman of the California Society of CPAs. Ask him a question.

Daniel Tahara

Daniel Tahara takes your questions about California taxes. Tahara, a spokesman for the state Franchise Tax Board, has 10 years of experience as a tax auditor. Ask him a question.



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