Jennifer, a CFP® practitioner meets with new clients, Max and Alicia, for the first time. She reviews their overall financial and estate planning goals, and their list of current assets. Max and Alicia have the following assets: Max’s 401(k) $250,000 - Alicia is the beneficiary Alicia’s 403(b) $520,000 – Max is the beneficiary House owned as TbyE valued at $350,000 Vacation home Max inherited with his sister Ava as JTWROS valued at $500,000 Mutual fund account owned as TIC valued at $700,000 Bond portfolio owned JTWROS valued at $600,000 Max and Alicia have two children – Doug and John. Doug is single and has no children. John was killed in a car accident last year, leaving two children, Tammy and Denise. Max and Alicia ask Jennifer several questions about their estate planning. Assuming Max predeceases Alicia and Alicia does not change her will, what is the amount that Tammy will inherit at Alicia’s death? Select one: a. $1,235,000 b. $1,110,000 c. $617,500 d. $605,000
Jennifer, a CFP® practitioner meets with new clients, Max and Alicia, for the first time. She reviews their overall financial and estate planning goals, and their list of current assets. Max and Alicia have the following assets: Max’s 401(k) $250,000 - Alicia is the beneficiary Alicia’s 403(b) $520,000 – Max is the beneficiary House owned as TbyE valued at $350,000 Vacation home Max inherited with his sister Ava as JTWROS valued at $500,000 Mutual fund account owned as TIC
Select one:
a. $1,235,000
b. $1,110,000
c. $617,500
d. $605,000
Here is the breakdown of the assets that Tammy will inherit:
- Max's 401(k): $250,000
- Alicia's 403(b): $0 (since the beneficiary is Max)
- House: $0 (since the asset is owned as TbyE, it will pass to the surviving spouse)
- Vacation home: $0 (since the asset is owned as JTWROS, it will pass to Max's sister Ava)
- Mutual fund account: $0 (since the asset is owned as TIC, it will pass to the surviving spouse)
- Bond portfolio: $300,000 (half of the asset will pass to Max's sister Ava, and the other half will pass to Tammy)
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