Estate Planning Objectives During Retirement

Question 1

Seven Ways Estate Planning can help clients achieve their objectives

Answer 1

(1) Provide for the financial needs of survivors, (2) Ensure that property is distributed according to their wishes, (3) Protect assets from being seized by creditors, (4) Avoid the costs and delays associated with probate, (5) Make provisions for incapacity, (6) Minimize Taxes, and (7) Ensure orderly succession in closely held or family business.

Question 2

Estate

Answer 2

(1) An estate is all the rights, titles, and interests that a person has in property. (2) An estate can include both tangible and intangible personal property and real property.

Question 3

Estate Planning

Answer 3

(1) Estate planning is an activity that arranges for the conversation and transfer of property from one person to another person, or (2) entities so as to achieve, as much as possible, the first person’s objectives and minimize taxes and transfer costs.

Question 4

Probate Estate versus Gross Estate

Answer 4

(1) A person’s probate estate is comprised of all assets that will be transferred at the person’s death either by will or by state laws of intestate succession, (2) A person’s gross estate includes all assets that are subject to the federal estate tax at the person’s death.

Question 5

Codicil

Answer 5

The document that amends or adds to an existing will

Question 6

Personal Representative/ Executrix/Executor

Answer 6

Personal representative is the generic term given to a person appointed by a court to administer a decedent’s estate.

Question 7

Purposes of probate

Answer 7

(1) Validation of the decedent’s will or a determination that the decedent had no will or that the decedent’s will does not dispose of all probate assets. (2) Appointment of a personal representative to administer probate assets, and (3) Determination and payment of valid debts and tax obligations of a decedent.

Question 8

Trusts

Answer 8

(1)Trusts are will substitutes when they are funded with property during the grantor’s lifetime. (2) Such property avoids probate since the grantor no longer has legal title at the time of death.

Question 9

Totten trusts

Answer 9

(1) Where permitted, it creates a revocable trust over a designated bank or savings accounts. (2) Operates like a POD account except that an actual trust agreement is executed by the depositor.

Question 10

Government Savings Bonds

Answer 10

(1) Title may be designated in two different ways: right of survivor-ship or (2) POD/TOD

Question 11

Fee Simple or Sole Ownership

Answer 11

(1) Ownership in fee simple, also known as sole ownership, (2) means that one individual has absolute rights to use, enjoy, and possess the property to the exclusion of all others. (3) Fee simple may sell, borrow against, and or give away property.

Question 12

Tenancy by the entirety

Answer 12

(1) Between spouses, and gives each spouse lifetime and testamentary rights, except the spouses must consent when borrowing, selling, or giving away his or her property interest without the consent of the other spouse,

Question 13

Tenancy in common

Answer 13

(1) Unlike joint tenancy, the interest need not be common, (2) there is no right of survivorship ,and they can use, enjoy, possess the property, sell, or borrow against during his or her lifetime.