Exam 3 Flashcards
gifting
can gift up to 16,000 dollar per person per year to anybody you choose to give a gift to
Estate Planning
- idea of how I want my assets to be distributed after I have passed on, is a legal process, it is required
Codicil
how to make changes to our wills, minor changes no major changes
beneficiary
the person who benefits from your death
executor
individual who is carrying out the way that the will is written
administrator
used if there is not a will
Heir
your biological child that is entitled to money from your estate
guardian
if you have children under the age of 18 you need to identify who is going to take care of your children that is this
-you have to say if you want to write someone out of your will
Power of attorney medical
able to make medical decisions with and for the individual
power of attorney financial
able to pay the bills and maintain the financial side with or without them, can write out checks
Advanced Directive
another name for a living will, legal document, what your intentions are, executor has to carry this out
Living will
not legally filed, what you intend have happen to you
letter of last instruction
says what you want to have happen at the funeral
estate tax
paid to the government based on the value of the entire estate before it is closed, the estate attorney pays this money up front
inheritance tax
what the individual has to pay based on the inheritance usually 4% and goes up but travels from spouse-to-spouse tax free – most of time the estate will take care of this for you
probate
process of being reported with the court, it is public, you do not have a will, lengthens the time to close an estate
interstate
if you die without a legal will
simple will
half goes to spouse and half to kids – how they are written
Traditional Marital share
50-50
Formal will
go to attorney signed notarized and finialed
holographic will
video, or own handwriting
statutory will
legal zoom fill in the blanks
revokable trust
changes can be made
irrevocable trust
cannot make changes ever
403b
health services and nonprofits
401k
by coporations
401k
by corporations
pensions
given to you in terms of education or union type jobs, different from retirement plans, everyone puts in the same dollar amount
IRA
once you hit 59 and a half you can start pulling money from it, all about minimum required distribution
tax deffered
401k, putting in money and pay taxes on it when you pull the money out
tax exempt
put in money after already paying taxes and grows then takes money out does not have to pay taxes on it
vested
goes toward 401k, remain with that same cooperation for 4 to 5 years, once you have met it any matching that they do is now considered your money
annuity
regular monthly payments
age retirement
65
SS(FICA)
collect at 62 but get reduced benefit until 65, 70 get extra benefit
incontestability clause
comes into play with estate planning, says within the first two years of taking out a policy with suicide or a crime then there will not be a payout
Firm Life insurance
Life insurance is a contract between an insurer and a policyholder. A life insurance policy guarantees the insurer pays a sum of money to named beneficiaries when the insured policyholder dies, in exchange for the premiums paid by the policyholder during their lifetime. Life insurance is a legally binding contract
whole life insurance
gives individuals and their families financial security; are also useful for businesses as a contingency plan for the loss of a key employee or partner
actuary
the individual who calculates risks and give them a dollar value
limit order
giving a specific dollar amount, a limit in which you are willing to spend, defined number
market order
buying that share that day for that price at that moment
common stock
gives you voting rights in shareholder meeting one vote per stock, give up rights to dividends
preferred stock
guaranteed dividends, not able to vote the dividend is taxed
proxy
will vote on share holders’ behalf will submit vote
dividends
the dividend amount is either a stated amount of money for each share or preferred stock or a percentage of the par value, can be cumulative, is taxable as income on your tax return
voting
when holding shares in a common stock the shareholder can vote in meetings
closed end
no longer taking in new investors, can only get a share if a current investor sells off their shares
open end
takes in new investors
mutual fund
it is professionally managed, great for new holders
IPO
initial public offering, when company comes to market for the first time it occurs on the primary market only selected to be able to buy them, money goes directly to the company
primary market
IPOs occur
secondary market
day two of trading New York stock exchange and Nasdaq- has 4 letters in their ticker symbol
ticker symbol
how you identify a stock 3 or 4 letters could be less than 3
components of a bond
principle or par value of $1,000 dollar
coupon
interest rate, money you will pay twice a year
