BUSINESS FINAL EXAM PT.2 Flashcards
What is the Coverdell Education Savings Account (ESA) ?
education savings account is a trust that assists families with educational expenses.
It works like a Roth IRA, except contributions are limited to $2,000 annually per child under 18.
Earning are tax-free and no taxes on withdrawals to pay for education.
What is a single life annuity?
An payment plan that offers a retiree with a monthly payment for as long as he or she lives. When the annuity holder dies, the payments stop.
what is a Joint and survivor annuity?
is an insurance product designed primarily for retired couples who want a guaranteed monthly income that will continue for as long as either spouse lives.
What is a California Durable Power of an Attorney?
It is a document that authorizes your agent (a person you choose) to manage your financial affairs if you become unable (or unwilling) to manage them yourself.
What is a 12b-1 fee?
It is an annual marketing or distribution fee on a mutual fund
What is the tax treatment like for Annuity payments?
Annuity payouts are generally taxes as normal income.
how are social secruty benefits determined?
They are determined by number of years earnings, the average level of earning, and the adjustment for inflation.
What is an estate?
It is the economic valuation of all the investments, assets, and interests of an individual.
What are the specific cash needs of an estate?
medical costs, funeral expenses, legal fees, outstanding debt, estate and inheritance taxes.