Money Guy, 5-5-2006 Podcast
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Bring the Money Guy along in the car!
.The Importance of Wills and Estate Planning
What Wills Help You With:
*Funeral Arrangements
*Disposing of your property
*Names a guardian for your minor children
*Names the executor or the administrator of your estate
Legal Terms Used in Estate Planning:
*Dying Testate: you died with a will
*Dying Intestate: You dies without a will
If you have minor children, it is imperative that you have a will. Without a will, a court will probably award the custody of your children to the nearest available relative. Whoever you determine will be the best guardian for your children, I would recommend that you actually ask them if they would take on this awesome resonsibility if ever required. This is a big responsibility and on that should not be taken lightly.
So What is a Will?
*A Will is a legal document that must comply with specific state laws
*A Will should generally be typed
*The person making the Will should be clearly identified
*Clearly state that this is your Will and revoke all previously made Wills
*You must be at least 18 years old and of sound mind and body at the time the Will is made
*Will must be signed and dated and generally witnessed by at least two qualified individuals
If possible, you want your assets to transfer ayutomatically at your death. This will help you avoid the cost and delays of going through probate.
Limitations of Wills
*Life Insurance
*401Ks, IRAs, and other retirement accounts
*Living trusts
*Pay-on-Death Accounts
*Property held jointly with a right of survivorship
Your Will does not supersede any of these beneficiary designations
Other Considerations for Wills:
*Credit-Shelter Trust or By-Pass Trus- Through this trust you can transfer up to $2,000,000 (growing in stages to $3,500,000 by 2009) to any beneficiary without payment of any estate tax. The trust is designed to bypass your spouse's taxable estate, while still providing your spouse access to the trust funds
*QTIP (Qualified Terminable Interest Property)-type of trust created to take advantage of specific estate tax advantages for married couples. Under QTIP trust, the deceased spouse can leave their property in a trust providing income for the surviving spouse as long as they are alive and at their death the remaining interest in the trust goes to whomever the deceased spouse chooses.
*Distribution of asstes to children
BRIAN PRESTON'S "WEALTH REPORT" PRINT NEWSLETTER. For only $29/year, subscribe to a quarterly guide that helps you keep up with the changing investment world. All proceeds directly offset the cost of producing this blog and podcast.
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1 comment
2 years and 6 months ago
Brian,
I really appreciate everything you do. I am 25 years old and have taken several pieces of advice that you have given in your podcasts. I have gotten the Fidelity rewards credit card you mentioned as well as started a Roth for myself and another inmy wife's name that are automatically drafted each month. I have been a religious listener since your first podcast. I have a question (for my wife) regarding her 401K. She will be leaving her job before she is vested in the company she works for. Currently she puts 6% of her small salary, and the company she works for puts in 3%. I know there are several options, however I was wondering which would be the best because I am the second most frugle guy next to you. I know we can roll the money into our Roth IRA's, leave it and just let it ride, take it out, or roll it into the next company she works for ( We don't know how long she will be inbetween jobs and how quickly you need to roll the money into a new 401K). I was wondering which would be the smartest move. Just wondering if you could give us a little advice.
Thanks
Kevin Harp, Daphne, AL
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