finance

Estate planning glossary


1. Ademption -- Something that happens when property is bequeathed that is no longer in the estate. If person A dies and the will states that person B gets a grandfather clock and the clock is no longer in the estate, then person B gets nothing and the property is adeemed.

2. Administrator -- A person appointed by the probate court to handle the distribution of property for a person who has died intestate. Some wills also neglect to name an administrator, so the court appoints someone for them as well.

3. Advance medical directive -- Can be three different instruments: A living will, power of attorney for health care, or medical power of attorney and a healthcare proxy. These documents state what kind of treatment you would like in medical emergencies and appoint someone to make medical decisions on your behalf if you are incapacitated and unable to make your own decisions.

4. Beneficiary -- The person or organization who receives property under a legal document such as a will, trust or insurance policy.

5. Bequest -- Two types: A specific bequest is a gift by will of an identified type of property, for example, a car or home. A general bequest is a gift from the general assets of the estate.

6. Chattel -- Personal property that can be moved.

7. Codicil -- An amendment or supplement to a will that must signed and witnessed.

8. Community property -- Property acquired during marriage in a community-property state, except for property obtained prior to marriage or through gift, inheritance and court award.

9. Conservator -- A person appointed by the court to act on behalf of someone who has become mentally or physically incapacitated, or is too young to act alone. Often acts with respect to the ward�s property rather than with respect to the ward�s personal matters.

10. Credit shelter trust -- A way for couples to reduce federal estate taxes when their combined assets exceed the allowable exemptions. A credit shelter trust enables them to take full advantage of the federal estate tax applicable exemption amount.

11. Decedent -- The person who has died.

12. Discretionary trust -- A trust in which the creator, or grantor, grants the trustee license to make specified decisions regarding the trust, including decisions concerning disbursements to the beneficiaries.

Show Bankrate's community sharing policy
          Connect with us
advertisement
MORTGAGE & REAL ESTATE NEWSLETTER

Timely market news and advice for consumers ready to buy, sell or invest in real estate. Delivered weekly.

Blog

Judy Martel

Bid for a home with $1,000

Detroit is auctioning off vacant homes for a song, but winning bidders should be prepared for sweat equity.  ... Read more

advertisement
Partner Center
advertisement

Connect with us