PF Flashcards
Healthy Giving
Giving out of excess in your life
Unhealthy Giving
Does not enhance the well-being of both the receiver and giver
Prepare for giving
create a spending plan, assess your time
Some money management tools
- statement of financial position
- income and expense statement
- spending plan
How does giving change throughout the life cycle?
Children are often the recipents of giving
Financial Statements
Creates a plan for special events that involve giving
Earning
A career choice could be an ultimate form of giving
Savings and Investing
Savings and investing are valuable avenues to give`
Risk Management
Ensure you have planned for life events and accounted for such expenses prior to giving
Specific gifts
particular item or property in an estate transferred to beneficiary on owner’s death. Specifics must be provided
Non-specific gifts
does not refer to specific item. (all my personal possessions)
Residuary gifts
everything left in estate after all debts, bills and taxes have been paid and specific and non specific gifts have been distributed
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
Gifts to charities
Gifts left to charity in will are free from inheritance tax.
grantor
person who forms the trust and supplies the assets
trustee
person named in the trust to administer the trust according to the terms and state trust law
beneficiary
the person for whose benefit the trust property is held by the trustee
intent from grantor
must have a valid legal purpose
property
asses subject to the trust
Living Trust:
Trust in which you assign the management of your assets to a trustee while you are living
Revocable living trust
living trust that can be dissolved
Irrevocable living trust
living trust that cannot be changed, although it can provide income to the grantor
Purpose of a will
ensures the estate is distributed as desireddistributed
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.
Oral Will
Spoken testaments given before witnesses. Not widely recognized from a legal perspective
Testamentary Will
Formally prepared document signed in the presence of witnesses
Holographic Will
Written without the presence of witness. Rarely hold up in court
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
Elements of a will
name and place of residence
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.
Estate primary functions
peace of mind,
How long will you live on average
78
What is estate planning
a clear and complete plan of what should happen upon your death
Living Will
A plan to care for someone who is young or incapacitated and cannot care for themselves
Positive Outcomes of estate planning
Provide for loved ones after you are gone
Strengthen family relationships by giving them a path for them to follow
Reduce time, effort and costs for survivors
Leaves a legacy to family, organizations, institutions
Trade-Offs
A trade-off is giving up one thing for another
Estate planning for teens
- Must be 18 in most states
- Letters are not legal documents
- Letters are preferred over conversation because they have a longer presence
What can attorneys do for you?
Attorneys can provide you insights for titling documents, wills etc…
Accounts
can help you determine net worth, see tax advantages
Certified financial planners
can help you diversify investments, protect assets
