Many clients may consider it an honour to be named as the executor of someone’s estate, but you should caution them that settling an estate can be an overwhelming responsibility.

Knowledge, availability and impartiality are the three qualities an executor needs to get the job done, according to Paul Fensom, director of Toronto-based Bank of Nova Scotia’s private client group.

“There is a high and wide degree of knowledge required to carry out the job,” Fensom says. Knowledge of estate law, estate-settlement procedures and tax law, for example, would be needed.

Availability is often underestimated as a necessary trait. Fensom estimates that administering an estate can take up to 18 months — when you consider the time it can take to process documents, such as tax clearance certificates from the Canada Revenue Agency. An executor might need to drop everything to complete certain tasks by specific deadlines.

And don’t underestimate the difficulty of assessing who is most likely to offer such flexibility, especially at a future date. Even when a client chooses to appoint a lawyer as an executor (or a co-executor), Fensom says, there is always a possibility that the professional may be spending six months a year out of Canada by the time the client dies.

Impartiality can be crucial, particularly in today’s society, he adds, in which second marriages and blended families can make for a more complicated — and potentially acrimonious — estate situation.

Yet, many Canadians step blindly into the role of executor, unaware of the administrative duties and the legal and liability issues involved, according to John Hamilton, president of Toronto-based Royal Bank of Canada’s estate and trust services in Toronto. He recommends financial advisors take estate planning a step further with clients by ensuring the clients tell their advisors in detail about plans for the clients’ estates. Clients need to be made aware of the many and varied tasks for which executors are responsible, Hamilton says, so clients know what they are asking of their executors and can take appropriate action to ensure that their estate is settled as smoothly as possible.

Settling an estate involves 43 administrative tasks, many of which have multiple steps, according to RBC. As recently as five years ago, a typical executor might have been expected to perform these tasks on his or her own, perhaps delegating some to professionals such as accountants, lawyers and realtors.

Only the wealthy would be willing to shell out the fee — which ranges from 4% to 5% of the estate’s assets — to hire a trust agent. However, clients should be warned that trust agents take absolute control of the process of settling an estate, says Hamilton: “We and every other trust company would want to do everything or nothing.”@page_break@But the growing complexity of both family structures and assets — even for the average Canadian — along with the oft-quoted trillion-dollar transfer of wealth that’s expected to take place in the coming years, has created a new market. These days, executors who are not professionals can work with trust officers at a number of financial services institutions to settle an estate — in considerably less time and with fewer snags, according to Hamilton, than going it alone.

“I call it ‘partnering with the people going through this experience’,” Hamilton says, “rather than the old world of ‘command and control,’ in which you go away and [say], ‘I’ll tell you when it’s done’.”

Working with an agent can eliminate any concerns the beneficiaries may have about how an estate is handled, says Hamilton. And it can be a touchy, emotional process, he adds. Grieving relatives and family squabbles can delay the process even further.

RBC’s estate and trust services division offers two flat-fee packages for individuals, based on the amount of work that is expected. The basic package, which covers tax preparation, government documentation and the collection of investment assets, costs about $5,000. The next level of service includes handling the contents and sale of a home and the preparation of beneficiary statements, and costs $7,000-$8,000.

Larger or more complicated estates still require the “percentage of assets” fee model, but these fees are also more flexible now, with the agent charging 1%-4%, depending on the level of complexity involved. The more intricate situations, for example, might involve out-of-country real estate and beneficiaries.

Scotiabank offers a similar service, called Estate Assist, to its clients. Fensom points out that fees are designed to be in the range of what courts allow executors in terms of payment. Economies of scale can make this option more economical than working directly with a number of professionals. In your clients’ wills, they can appoint a trust agent directly as their executor.

Another, more common option is to name the executor, usually a family member, and instruct him or her — often in a letter attached to the will — to work with a trust officer. These letters are non-binding, says Fensom, so advisors should encourage clients to speak to their executors about their desires ahead of time.

If your client is appointed as an executor but lacks such a letter detailing the deceased’s wishes, the client can still work with a trust company as much, or as little, as required. At the very least, your client can turn to their financial services institution for additional guidance. IE