50 Terms Personal Finance Flashcards
(50 cards)
Unhealthy Giving
Does not enhance the well-being of both the receiver and giver.
When giving is a method of gaining power over another.
UHG
Grantor
person who forms the trust and supplies the assets
GRA
Trustee
person named in the trust to administer the trust according to the terms and state trust law
TRUST
Beneficiary
the person for whose benefit the trust property is held by the trustee BEN
Intent from grantor
must have a valid legal purpose IFG
property
asses subject to the trust PROP
Specific gifts
particular item or property in an estate transferred to beneficiary on owner’s death. Specifics must be provided SG
Non-specific gifts
does not refer to specific item NSG
Residuary gifts
everything left in estate after all debts, bills and taxes have been paid and specific and non specific gifts have been distributed RG
Gifts to children
executors will keep for safekeeping gifts to children under 18 until they become of age unless will specifies guardian or parents take receipt of gift on child’s behalf GTC
Gifts to charities
Gifts left to charity in will are free from inheritance tax. GCHAR
Living trust
trust in which you assign the management of your assets to a trustee while you are living LT
Revocable Living Trust
living trust that can be dissolved RIT
Irrevocable Living trust
living trust that cannot be changed, although it can provide income to the grantor ILT
A Living Will
a document to make your family aware of the type of care you want to receive if you should become terminally ill, on life support or permanently unconscious. This document is only effective in the event you are unable to express your wishes yourself. ALW
Oral Will
spoken testaments given before witnesses. Not widely recognized from a legal perspective OW
Testamentary Will
formally prepared document signed in the presence of witnesses. TW
Holographic Will
written without the presence of witness. Rarely hold up in court. HW
Will
is a legal document by a person, the testator, that names one or more persons, executor, to manage his or her estate and provides for the distribution of property upon death. It can also identify a preferred guardian for any surviving children. W
Purpose of a Will
Ensures the estate is distributed as desired
Beneficiaries (heirs), the persons specified in will receives a part of an estate
T prevent the courts from assigning an administrator who may not carry out your wishes. POAW
Elements of a Will
A Will is a legal document designating the transfer of property and assets upon a person’s death. A Will can be written by any person of legal age and being of sound mind and memory. It ensures that your assets will be given to family members or a designated beneficiary. If you have no heirs and die without a will, the state can claim the estate. If you have young children, a will can allow you to designate a guardian in the event of your death otherwise, a court can appoint a guardian. EOAW
What is needed in a will
name and place of residence description of assets names of spouse, children and other beneficiaries alternate beneficiaries specific gifts establishment of trust if desired cancellation of debts owed to you name of executor to manage the estate name of guardian for minor children name of alternative guardian your signature witnesses' signatures WINIAW
Executing the Will
The executor files forms in probate court, provides a copy of the will, a list of assets and liabilities of deceased, pays debts and sells necessary assets. The executor typically opens a bank account for this purpose.
Probate is a legal process that declares a will valid and ensures the orderly distribution of assets. ETW
How Long Will You Live
Americans, on average, live to 77.9 years old
