When utilizing trust-based planning as part of your overall estate planning solution, both a will and a revocable living trust are used to create a comprehensive estate plan. The will acts as a catch-all for any assets that are not already in trust or are not already pointing to or paying to the trust at death. The will appoints an Executor, and the trust appoints a Trustee. But, what’s the difference between an Executor and a Trustee, and who controls what?
The Executor is the person or entity appointed under a will, by the testator (the creator of the will), to settle the testator’s estate according to the provisions and directions set forth in the will. Wills generally only control probate assets, so the reach of the will may be limited based on the assets of the testator and the beneficiary designation or transfer-on-death provisions on those assets. The Executor is bound by a fiduciary duty, meaning the Executor must always do what is in the best interest(s) of the beneficiary(ies) when administering the estate. The Executor’s duties terminate when the estate’s assets are distributed to the intended beneficiaries and the Executor is discharged by the Clerk of Court in the county where the estate is being administered.
The Trustee is the person or entity appointed, in the trust, to succeed the grantor (the creator of the trust) after they become incapacitated or pass away. The Trustee also has a fiduciary duty to the trust’s beneficiaries. The Trustee only controls the assets which are being held in trust. For example, if an asset is moved into the name of the trust or is beneficiary designated to the trust, the Trustee has control over that asset and must hold and administer the asset according to the terms of the trust from which they are appointed.
When a trust-based plan is being used, the Executor essentially wraps up what is left to settle from the estate (probate assets) and passed them on to the Trustee. The Trustee and Executor may be the same individual, but they assume different roles.
Paul Yokabitus is the CEO and Managing Partner of Cary Estate Planning, a Cary, NC, estate planning law firm. With years of experience in estate and elder law, he has zealously represented clients in various legal matters, including estate planning, guardianship, Medicaid planning, estate administration, and other cases.
Paul received his Juris Doctor from the Campbell University School of Law and is a North Carolina Bar Association member. He has received numerous accolades for his work, including being named among the “Best Attorney in Cary” in 2016 and 2017 by Cary News and Rising Star in 2020-2023 by Super Lawyers.