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The Ultimate Estate Planning Quiz
by Staff
While you might not want to think about what will happen to your assets after you die, proper estate planning is necessary if you want your wishes to be carried out. Wills and trusts are just part of estate planning, a complex but important segment of financial planning. Take this quiz to determine if you have the knowledge to get your assets to your heirs with the least hassle and cost.

What is the main idea of estate planning?

  • making sure your assets go to the people you want them to after you die
  • protecting your physical property from the government after you die
  • establishing a life insurance plan to ensure that your family is provided for after you die

When does estate planning take effect?

  • upon death or incapacitation
  • only upon death
  • whenever you want it to

In addition to a will, what else is a common element of an estate plan?

  • an assignment of power of attorney
  • a tax-free bank account
  • a burial plot

What is a health care proxy?

  • a legal document that appoints someone to make decisions about your health care if you are unable to do so
  • a person who will receive the pay out of your remaining health insurance
  • a public hospital

What is a benefit of a trust over a will?

  • It does not need to be processed in court.
  • It is entirely tax free.
  • It is more comprehensive.

In the term "last will and testament," what were the original meanings of "will" and "testament?"

  • real estate and personal property, respectively
  • property and personal wishes, respectively
  • transfers to individuals and to organizations, respectively

In addition to the distribution of your assets, what else is a good use for a will?

  • appointing guardians for young children
  • choosing a health care proxy
  • summarizing your life philosophy

What does it mean to die intestate?

  • dying without a will
  • dying in a state other than your home state
  • dying without any significant assets

When you give someone power of attorney, what is he or she called?

  • your agent
  • your lawyer
  • your executor

What is different about durable power of attorney?

  • It stays in effect even if you are incapacitated.
  • It has no time limit.
  • It extends beyond finances to healthcare issues as well.

What is power of attorney fraud?

  • misusing one's access to a different person's assets
  • claiming that regular power of attorney is actually durable power of attorney
  • forging a power of attorney form

At what size estate does a trust start making sense?

  • 100000
  • 500000
  • $1 million

What is the typical cost of probate proceedings?

  • 2 to 4 percent of the estate's value
  • $1,000 per week
  • a flat fee of $10,000, regardless of estate size

What three parties are involved in a trust?

  • grantor, trustee and beneficiary
  • trustee, truster and trusted
  • agent, trustee and executor

What is an inter vivos gift?

  • a tax-free gift given while you are still alive
  • a gift to the trustee
  • a gift that is set up while alive, but only is given after death, thus avoiding the gift tax