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Retirement & Estate Planning Flashcards

Retirement & Estate Planning Flashcards
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United States Treasury
A government agency in charge of managing the fund for social security
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Social Security Act
An act passed by President Franklin Roosevelt to attempt to address poverty, joblessness, and other social concerns
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Benefits Offered by Social Security

Retirement

Survivor

Disability

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Federal Insurance Contributions Act (FICA)
This act was set up to allow social security and Medicare to be deducted from the paychecks of un-exempt employees.
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Medicaid
Individuals who cannot pay for healthcare with their income can get help through this state and federally funded program. Each state is responsible for administering this program.
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Medicare
This health insurance program is federally funded and offered to individuals over the age of 65, frequently after retirement.
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Estate Planning
A process wherein an individual decides how his or her assets will be distributed after death. Assets can be distributed to beneficiaries in any amount that the benefactor wants.
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Benefactor
The individual who sets up a death benefit.
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Beneficiary
This individual is granted a death benefit from a benefactor.
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Cost of Living Adjustment (COLA)
A change in salaries and payment of benefits designed to ensure these payments match inflation
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How often the cost of living adjustment (COLA) is performed for social security benefits
This assessment is performed on an annual basis.
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23 cards in set

Flashcard Content Overview

Completing the flashcards in this set will allow you to review the history and uses of social security, Medicare and Medicaid. You can focus on estate planning and the creation of wills as well as learn about benefactors and beneficiaries. You'll also find cards that cover retirement plans, including traditional 401k plans, Roth 401k plans and simplified employee pension individual retirement accounts.

Front
Back
How often the cost of living adjustment (COLA) is performed for social security benefits
This assessment is performed on an annual basis.
Cost of Living Adjustment (COLA)
A change in salaries and payment of benefits designed to ensure these payments match inflation
Beneficiary
This individual is granted a death benefit from a benefactor.
Benefactor
The individual who sets up a death benefit.
Estate Planning
A process wherein an individual decides how his or her assets will be distributed after death. Assets can be distributed to beneficiaries in any amount that the benefactor wants.
Medicare
This health insurance program is federally funded and offered to individuals over the age of 65, frequently after retirement.
Medicaid
Individuals who cannot pay for healthcare with their income can get help through this state and federally funded program. Each state is responsible for administering this program.
Federal Insurance Contributions Act (FICA)
This act was set up to allow social security and Medicare to be deducted from the paychecks of un-exempt employees.
Benefits Offered by Social Security

Retirement

Survivor

Disability

Social Security Act
An act passed by President Franklin Roosevelt to attempt to address poverty, joblessness, and other social concerns
United States Treasury
A government agency in charge of managing the fund for social security
Age requirement for the collection of social security benefits
This requirement varies based on factors set up by the Social Security Administration, but generally people may begin collecting some benefits by the age of 62.
Inter Vivos Trust
These trusts are set up by benefactors before they die. It can also be called a living trust.
Irrevocable Trust
You can't change or revoke this type of trust without the permission of the trust's beneficiaries.
Disadvantages of traditional individual retirement accounts

Income tax must be paid when withdrawing money

There are penalties for early withdrawals

Funds can't be accessed until an employee reaches a certain age

Traditional 401k Retirement Account
In this kind of retirement account, employees contribute money from their paychecks before taxes are taken out.
Roth 401k Retirement Account
A retirement account that requires employees to put in income after its taxed. You don't pay other taxes when you take money out of this account.
Simplified Employee Pension Individual Retirement Account (SEP IRA)
This is a retirement account funded by tax-deductible contributions made by the employer. These contributions are for all employees who are eligible.
Age when you are allowed to create a legally enforceable will
Individuals are eligible to create this document at the age of 18.
Executor of the Estate
This person or people are responsible for carrying out the terms of a person's will involving assets and property
Codicils of Wills
These represent addendums to an individual's original will. They are legally enforceable and represent the new wishes of the person creating the will, who is known as the testator.
Characteristics of legally enforceable wills

Created voluntarily and with intent

Made by someone with the capacity to know what he or she is doing and who is of legal age

Dated and signed

Trust
This fiduciary agreement allows a third party to handle the assets and property that an individual left to a minor child with a will.

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