CTFA Estate Planning and Administration

Question 1

Which document allows an individual to name a personal representative and specify how their estate should be distributed after death?

Accepted Answer

Last will and testament

Answer

A last will and testament is the legal document that names a personal representative (executor) and directs how the decedent's probate estate is distributed.

Question 2

What is the primary advantage of a revocable living trust over a will in estate planning?

Accepted Answer

Avoidance of probate

Answer

A revocable living trust allows assets to pass directly to beneficiaries without going through the public, time-consuming probate process.

Question 3

Under the Uniform Probate Code, what is the order of priority when multiple claims exist against an estate?

Accepted Answer

Funeral costs, administration expenses, then creditor claims

Answer

Most states prioritize estate administration costs and funeral expenses before general creditor claims when distributing a decedent's estate.

Question 4

Which type of asset generally passes outside of probate directly to a named beneficiary?

Accepted Answer

Life insurance with a named beneficiary

Answer

Life insurance proceeds payable to a named beneficiary pass outside of probate and are not subject to the terms of the will.

Question 5

What is a pour-over will in the context of estate planning?

Accepted Answer

A will that directs probate assets into an existing trust

Answer

A pour-over will directs any assets that were not transferred into a revocable living trust during life to 'pour over' into the trust at death.

CTFA - Certified Trust and Fiduciary Advisor Practice Test

CTFA - Certified Trust and Fiduciary Advisor Practice Test

CTFA Estate Planning and Administration