Evidence over emotion. Process over prediction. Better decisions over better guesses.
Most financial decisions eventually tell you how they turned out. Choosing your executor never will.
You will not be there to see whether the person you named handled it competently, whether your children are still speaking to one another afterward, or whether the estate settled in eight months, three years or longer.
As I wrote in the first article in this series we judge decisions by their results almost automatically. Here no result is available to judge. The reasoning is the only thing you will ever have, which is a good argument for doing it properly.
What would have to be true for your choice to work?
Most people name an executor the way they would hand out an honour. The oldest child. The sibling who is good with money. The person who would be hurt to be passed over.
A better test is the one this series keeps returning to. What would have to be true for this person to be the right choice?
Three things. They need the time. They need the temperament to hold a position under pressure from people they love. And they need the willingness to pay for professional help rather than guess. Most executors are appointed without anyone testing a single one of those conditions.
How much time does being an executor take?
Estate practitioners commonly estimate 100 to more than 400 hours, spread over twelve to thirty-six months or sometimes longer. Treat that as practitioner judgment rather than a measured Canadian average, because no reliable average exists. At the upper end, 400 hours is ten full working weeks to fit around a job and a family, often while grieving.
The value of the estate tells you less than you would expect. An organised portfolio can be easier to administer than a modest estate with awkward complications. A family member or other beneficiary may need to be located if you have lost contact with them. One living outside Canada brings legal, tax, currency, and cross border considerations. Property abroad may require local legal and real estate expertise. Complexity comes from family circumstances and where assets sit, not from the size of the balance.
The unpredictable demands are harder still. One beneficiary wants the cottage sold, another wants to keep it, and your executor referees while explaining why nobody is being paid as quickly as they expected.
Can an executor be personally liable?
Yes, and this is the part most people never hear before they agree.
If an executor distributes estate assets without obtaining a clearance certificate from the Canada Revenue Agency, and tax remains owing, the executor can be personally liable up to the value of what was distributed. That includes amounts assessed after the money is gone. CRA does permit distributions before a certificate is issued if enough property is held back to cover the liability, so an executor needs advice on how much to retain.
Picture explaining to your siblings that part of their inheritance has to wait, even though the investments are sold and the cash is sitting in the account. From where they stand there is no visible reason for the delay. Your executor confirms the estate’s tax position anyway, and absorbs the resentment while doing it.
This is why temperament matters as much as financial knowledge. The person needs to be comfortable keeping records, explaining decisions, and saying no to people who will not enjoy hearing it.
Is your executor paid for this work?
They are entitled to be, and that is worth knowing before you compare options.
Ontario uses a long-standing guideline of 2.5 percent of capital receipts and 2.5 percent of capital disbursements, with the same rates on revenue in and out, plus a care and management fee of up to 0.4 percent per year on the average value of the estate. Add those together and you arrive at the rough five percent of estate value that people usually quote.
It is a guideline, not an entitlement. Courts assess what is reasonable against the size of the estate, its complexity, the time and skill required, the results achieved, and the responsibility assumed, and they can award less. A family member may waive compensation. Many do not, and they are not wrong to claim it, because the work is real.
Estate administration tax, still widely called probate fees, belongs in the same conversation. In Ontario there is nothing payable on the first fifty thousand dollars, and roughly 1.5 percent on the value above that. It drives both the cost of settling your estate and the timeline your executor will be defending to impatient beneficiaries.
Should you appoint a professional?
It is a reasonable option, particularly where wealth is passing to the next generation, and interest in it has been growing.
There is more than one way to do it. A trust company can be appointed executor outright. Firms also act as agents, handling the administrative work while a family member stays the named executor, which keeps your family in control of decisions while removing most of the paperwork.
Be clear eyed about cost. Fees are generally a percentage of the estate and can look startling next to a family member doing it for nothing. The honest comparison is fee against fee rather than fee against free, since a family executor is entitled to compensation too. What you are buying is experience, fewer expensive mistakes, and someone absorbing conflict that would otherwise land on your children. Pricing and scope differ meaningfully, so compare before committing.
What about your power of attorney for property?
The person you appoint under a power of attorney for property manages your financial affairs during your lifetime, and that authority ends when you die. An executor deals with your estate afterward.
The same person may suit both roles, but assess them separately. Managing bills, investments, and care costs can mean years of continuous decisions. Someone willing to settle your estate may not have capacity for that.
Is there an estate decision where you do see the result?
One, and it deserves more attention than it gets.
If you have wealth beyond your own lifetime needs, giving during your lifetime is a real alternative to leaving a larger estate. Once affordability and the tax position are worked through, money given while you are alive arrives when the people receiving it can actually use it, rather than decades later when they may not need it at all.
It is also the one estate decision that gives you feedback. You see where the money goes and whether it helped. You get to watch a down payment turn into a house, instead of leaving the whole thing to be discovered by people you will never discuss it with.
That does not answer the executor question, and a smaller estate still needs settling. But if you are optimising a large estate for efficient transfer, it is worth asking whether some of it should be an estate at all.
Before you decide: what should you write down?
Three things, before you name anyone.
Write down the reasoning. Which of the three conditions does this person meet, and what evidence do you have for each? If the answer to any of them is that they are family, you have not answered it.
Write down what would change your mind. Circumstances move. Your child at fifty may not have the capacity at sixty-five.
Write down what your executor will need. An up-to-date list of assets and debts, where the original will is kept, and contact details for your lawyer, accountant, and advisor. The binder in the filing cabinet now has digital equivalents, and they are a clear improvement: better protected than paper, far easier to keep current, and available to your executor the moment they need them. What matters is that your executor knows where the information lives and can reach it. Online accounts need the same attention, since some services allow a legacy contact and others give access to very little.
Then have the conversation. Explain the work, explain the support available, and leave real room to decline. If you are the one being asked, find out what you are agreeing to before you agree to it.
Frequently asked questions
How do I know if I chose the right executor?
You will not, which is the point. Judge the choice by the reasoning behind it, because no outcome will ever be available to you.
Can my executor refuse after I die?
Yes. A named executor can renounce, which is one reason to confirm willingness in advance and to name an alternate.
Should my spouse be my executor?
Often it works, particularly where beneficiary designations, jointly held assets, and spousal rollovers keep matters simple. Your spouse still needs the willingness and capacity to handle what remains, so consider professional support and an alternate.
Does hiring a lawyer transfer the executor’s responsibility?
No. Your executor may engage a lawyer, accountant, and financial advisor, and should. The responsibility for administering the estate stays with them.
Steve Lowrie is a Portfolio Manager with Aligned Capital Partners Inc. (“ACPI”). The opinions expressed are those of the author and not necessarily those of ACPI. This material is provided for general information, and the opinions expressed and information provided herein are subject to change without notice. Every effort has been made to compile this material from reliable sources; however, no warranty can be made as to its accuracy or completeness. Before acting on the information presented, please seek professional financial advice based on your personal circumstances. ACPI is a full-service investment dealer and a member of the Canadian Investor Protection Fund (“CIPF”) and the Canadian Investment Regulatory Organization (“CIRO”). Investment services are provided through ACPI or Lowrie Investments, an approved trade name of ACPI. Only investment-related products and services are offered through ACPI/Lowrie Investments and are covered by the CIPF.
