10 Benefits Of A Prepaid Funeral

In the words of Richard Puz- “death leaves a heartache no one can heal; love leaves a memory no one can steal.” The death of a loved one can throw family and friends off balance. And when the passing is sudden and unexpected it is even more wrenching.

Nevertheless, death is as much a part of life as living, the only difference being that while nothing in life is certain, death definitely is. It is also incredibly stressful, both emotionally and physically on the people one leaves behind, not to forget the funeral expenses and decision-making stress when it comes to funeral arrangements.

Planning a funeral plan can be as smooth as silk with every family member in perfect harmony or it can also be chaotic and messy with every individual having different funeral planning ideas for their dearly departed. Which is why more and more people are considering prepaid funeral plans as part of the end-of-life planning.

What Is A Prepaid Funeral Plan?

A prepaid funeral plan is more of a strategy than a product. It means prepaying a funeral home in advance for an anticipated funeral in the future. It also involves taking the steps to layout everything connected to your funeral including the costs well before time.

Prepaid funeral plans are also referred to as pre-funeral arrangements or pre-needs and follow the same concept of writing your will or organizing your estate. You prepare for an expected event in the unforeseeable future by planning and paying for it in advance. A piece of helpful information, though, a prepaid funeral is something you can purchase for yourself or another person.

With a prepaid funeral plan, you have the liberty to decide the location of your burial site. You also get to choose what kind of service you will have.

Payment for a pre-paid funeral plan can be made in installments or as a one-time payment. The funeral home or the plan provider will either invest your money in a state-regulated trust fund or procure a life insurance policy with the death benefit dispersed to them.

If you are among those who are still weighing prepaid funeral pros and cons and wonder how pre-paid funeral plans work, be assured that it is not only straightforward but also empowering and offers peace of mind not only to the individual going in for such a plan but also to his/her loved ones.

How To Preplan A Funeral

There are certain aspects of funeral plans that are non-negotiable, certain situations where decisions on last wishes must be made clear and options depending on the type of burial or cremation you select.  

The funeral director may also introduce you to add-ons that you can include to your basic plans.. These are not standard for all providers and it depends on the funeral home's capacity and network.

While add-ons are not mandatory, not including them in your prepaid plan in the present might shift the burden of costs to your loved ones in the future since they would have to make the necessary arrangements and settle the payments in time for your wake and memorial service.

Although most of the funeral expenses are covered in the basic and add-ons,  there may be unique circumstances that would require an extra charge or fee. These expenses are usually not covered in any pre-paid plans and therefore the costs may vary greatly. Make sure you go thoroughly consider all options for a prepaid funeral and understand inclusions and exclusions before deciding on one.

Non-Negotiable Inclusions

The following inclusions in a prepaid funeral are non-negotiable and will always be included in any contract or policy that will be drawn up:

  • The basic services of the memorial home
  • Transportation fees for the transport of remains to the funeral home
  • Costs of embalming or refrigerating the body should the need arise

Last Wishes Decisions

Depending on your wishes and those of your loved ones, there will be many decisions to arrive at and these would include:

  • The medical care you want to opt for in your final days
  • Whether you want to opt for a casket or cremation
  • The kind of funeral service you want
  • The headstone
  • What goes in your obituary

Basic Plan Options

Basic prepaid funeral plans also include options for the following:

  • Burial or cremation
  • Casket or the cremation urn
  • Burial plot or the niche
  • Grave marker or headstone
  • Death certification
  • Clergy services


Some of the services that come under add-ons include:

Unique Circumstances

Some of these instances are:

  • If your death happens away from home and you need to be transported back to your home state
  • Additional embalming if an autopsy is required or requested by the family
  • Further preserving in case of an organ donation
  • The cost of receiving your remains from a different funeral home

Types Of Prepaid Funeral Plans

If you are wondering how to pay for a funeral in advance there are several prepaid funeral plan options to choose from. These include:

Whole Life Policy

The whole life policy is like any regular life insurance policy. On your passing, the pay-out is given to your beneficiary to pay for the funeral arrangements. Some states require that the director of the funeral home be nominated as the beneficiary.

Burial Insurance

This policy covers all expenses after your death. However, thebeneficiary can use the death benefit as they choose. We’ve discussed this in more detail below.

Revocable Trust

This involves signing a contract and you pay for your funeral in installments. Your payment is deposited into an interest-bearing account and after your passing, your nominee and the trustees use the funds in the account to pay for your funeral.

As the name suggests, changes can be made any time to a revocable trust. You can remove or add beneficiaries and change the stipulations regarding how you want your assets to be managed. A revocable trust offers you flexibility while giving you 100% control over your assets.

Irrevocable Trust

This works similar to a revocable trust, the only difference being that this is a permanent trust. In other words, an irrevocable trust is an agreement set in stone and only the assigned beneficiary can make any changes.  

The beneficiary's consent is required because, as the benefactor, you have technically moved all your assets into the trust, thus giving away all ownership rights and control over your assets.

Who Offers Prepaid Funeral Plans?

Families have several different options when it comes to choosing a prepaid funeral plan. The options may vary depending on where you live and how much time and research you want to invest. Funeral homes are the often the first place families start their search.

If you are considering a prepaid funeral plan, but are not too keen on getting it from your funeral home, there are other options that you can consider. These alternatives may suit you better, depending on your needs. Again, it pays to shop around and not settle on the first opportunity that comes your way, especially in investments like this.

Funeral Homes

If you have made up your mind about getting a prepaid funeral plan, it's best to connect with the funeral homes in your city or with your in-state funeral plan insurance providers. You can visit these homes and go through their brochures or even visit their websites to understand the kind of prepaid funeral plans they offer.

However it is best to talk to them personally, so you can allay any doubts or fears you or your family may have.

Regulated Trust

Funeral trust plans or regulated trust entails that you sign an agreement and then pay the funeral home of your choice the agreed on funeral cost. You can settle the payment either in monthly or quarterly installments or pay one time.

The funeral director will put your money into a trust account that gathers interests, and the funeral policy provider will be named the trustee.  After your death, the money is directly paid to the funeral provider who is the designated trustee and he/she will be responsible for carrying out your wishes.

Life Insurance

Life insurance is sometimes referred to as over-50s plans. This works differently from prepaid funerals because the funds go to your beneficiaries to cover lost income. This means that your family will still be responsible to make all the arrangements and pay for your funeral expenses too.

The problem with insurance policies is that the waiting period for the insurance pay-out can sometimes be indefinite. It can take weeks to months, which can be frustrating for the beneficiaries.

Burial Insurance

Burial assistance falls under the umbrella of life insurance, and it is used to settle payments for your funeral services and any other associated expenditure after your death. Since it is a cash policy, the cash value increases over time.

Burial insurance can be purchased in exchange for small amounts like $5,000. What's convenient about burial assistance is its ease of access. You can buy these policies online or through the telephone without the need for a medical exam.

You will be asked to provide necessary information like your age, any severe health conditions, and your medical history. This is a comparatively affordable option and the premiums included on this insurance don't change. Your burial insurance covers the cost of funeral service, casket, cemetery plot, funeral procession, headstone, and other miscellaneous expenses.

Payable On Death Account

A Payable on Death (POD) is also called a Totten Trust. It is a settlement between you and your bank, credit union, or a financial institution where it appoints beneficiaries to collect all of your assets. This instantaneous transfer of assets is activated upon your death.

PODs are simpler in form and are easier to create compared to the traditional death wills and trusts. Since it works like a standard bank account, you can deposit any amount that suits you whenever you want. It will gain interest through the years sans the complications and fees of the usual insurance policies.

10 Benefits Of Having A Prepaid Funeral

Funeral home prepaid plans can be your final parting gift to your loved ones. You can also consider this as a gift to yourself because you can have the memorial you want. Just as every life is unique, so is the end of life, and you can have that memorable memorial that you deserve with you as the planner.

Exploring the benefits of prepaid funerals is worth your time and money. It is important to understand the pros and cons of prepaid funeral plans so you can be confident in making your decisions. You can also consider exploring other options as part of your pre-planning for the inevitable. If you are not too sure about it yet, here are just some of the many benefits of having a prepaid funeral.

1. Your Family Can Attend To Their Grief & Healing

The death of a loved one no matter how expected is heart-breaking. However, even while they are in mourning, family members are expected to make urgent decisions regarding the funeral arrangements, typically within the following seven days or less.

While you have the advantage of time, your family does not, especially during their time of grief since they would be caught up with the arrangements for your final day.

Spare them this pointless worry and stress. With a prepaid funeral, everything is all arranged and paid for. They can focus on what's important, and that is sharing memories of you with loved ones and having time to grieve and find a way to heal from the loss.

Grief & Grieving

Instead of being away talking to people and choosing caskets and flowers, your loved ones can spend private time with you before bidding you the final goodbye.

2. You Have The Final Say On Your Memorial

There won't be any disagreements about the service or any family drama about the flowers because you have seen to it all, from the nitty-gritty right down to the minor details and they're all ready when the time comes. You probably know how you want to be remembered, so go ahead and plan it. That said, you can ask family and friends for help with preplanning a funeral.

The best way to guarantee that your wishes are made and respected is for you to plan your memorial. You decide on which music to play, the venue of your final resting place, the kind of flowers and arrangement to be set next to the casket of your choice.

You can also decide on the choice of songs during the funeral with your desired prayers and worship. You have 100% control over your funeral. In a way, this process can also help you come to terms with your impending death whenever that is.

An important point to remember here is that you need to communicate with your family about this set-up. You have to inform them that everything has been pre-arranged.

This is important because funeral planning is part of the grieving process for the bereaved. Don't take that process away from them. If they are open to the idea and are supportive, then involve them in your funeral planning ideas as much as possible.

3. Your Loved Ones Won't Need To Worry Financially

Life is expensive enough, but so is dying. The cost of dying continues to rise and you don’t want your loved ones to be burdened with funeral costs which can be surprisingly high. Paying for your funeral in advance will ensure that you are guaranteed to get the send-off you desire without saddling your loved ones with financial responsibilities.

Pre-arranging your memorial is as rational as planning for your retirement. You can pay in lump sum or installments, depending on your convenience and you end up safeguarding your family from the unforeseen expenditures and heartache of organizing an ‘at need’ memorial. No incurred debts just to lay you down in peace.

4. Zero Health Checks

Unlike health insurance which requires various procedures including medical checks, a prepaid funeral is completely hassle-free and seamless.

While it’s close to impossible to get a health insurance policy the older you get, there are no such limitations when it comes to prepaid funerals. You can get a prepaid funeral plan no matter what your age and the process is very simple and straightforward.

5. You Have The Luxury Of Time When Deciding

After the death of a family member, decisions are usually made in a rush and without careful thought. Planning your funeral while you still can, will give you the luxury of time to research various funeral homes in-depth, as well as consider the different options available to you while letting you pay careful attention to what you want and how you want it to be.

6. You're Not Affected By Inflation

A prepaid funeral is the most sensible and sound investment of your life because the most obvious benefit of getting one is the cost. Prices will continue to rise, and history is proof of that.

It goes without saying that the costs of flowers, caskets, and urns will be much higher twenty years from now. Refuse to be impacted by inflation. Pay in advance for your funeral expenses tomorrow, at today's current prices. If you do the math, you only stand to gain.

7. It Is Economically Convenient

In the absence of any funeral pre-planning, all costs right from hiring the services of a funeral home to paying for the casket, flowers, etc need to be paid upfront and as a whole. The timeline of settling payments can be anytime from 24 hours to 3 days. This can be overwhelming for some families.

Thankfully, prepaid funerals can be purchased and paid as a whole or in deferred payments. Depending on the plan you opt for, you can either pay in lump sum or in convenient payment options that do not pinch your pocket.

What's best is that these installments are interest-free, and you can make arrangements, so you don't need to get it done manually. You can arrange it so it gets automatically debited from your account, without having to worry about missing or late payment.

8. You Secure Your Final Resting Place

One of the reasons for many people to consider opting for a prepaid funeral is to secure their final resting home. Most want to be laid to rest near family that has gone before them, the thought of which provides a kind of comfort.

If you want a specific place to be buried in, like a spot next to your parents, spouse, or other loved ones, then that can be taken care of ahead of time with a pre-planned memorial. Your bereaved family won't need to look for a place for you and make compromises just to honor your wishes.

Additionally, the cemetery plot location you want may no longer be available during the time of your passing, so with a prepaid funeral, your desires of where to rest can be fulfilled without any complications.

9. You Get Exempted From Assets Evaluation

A funeral is a mandatory expense. Without the financial means, you can't really proceed with putting your loved one to rest. This is where another advantage of prepaid funerals comes into play. You can settle the costs as early as now, and at the same time, it won't impact your pension. If you have retirement income, this won't be affected either.

The price that you pay for the funeral is not considered as a portion of your assets. Financially, this is an advantage for you because you get the full benefit of your pension and retirement amounts.

10. You Can Have Peace Of Mind

You can be at peace, knowing that you didn’t become a burden to your loved ones at the end of your life. Thanks to your proactiveness of getting everything settled, you know that the loved ones you leave behind are spared the stress and the worry of giving you a good memorial service.

Money is known to drive families apart and money issues coming on the heels of a dear one’s death can compound problems further. Do not let your death destroy the very relationships you painstakingly sought to build your entire life.

You can move on without any regrets and pain, comforted during your final physical moments by the fact that you faced the future head-on and made the necessary arrangements you deemed fit.

Disadvantages Of A Prepaid Funeral

With all the advantages of a prepaid funeral, you may think that it is a guaranteed plan. Ideally, it is but again, the surprises of life can catch everyone off-guard, and like everything else, there are a few disadvantages of prepaid funerals as well.

Knowing the pros and cons of prepaid funeral plans, especially the possible risks, is important before making a final decision because once you seal the deal with the prepaid funeral provider, it is considered a done deal and there is no turning back. Let’s look at some of the disadvantages of prepaid funerals.

1. Business Stability

The funeral parlor or provider that you're currently in talks with might be the top service provider in your area at the moment. However, there is no guarantee that they will still be reliable or even in business during the time of your passing.

Unfortunately, you have to accept the possibility that when you die, the funeral organization to which you've entrusted your memorial services may have gone bankrupt or even be out of business.

Embezzlement is a harsh reality too. If this happens while you are still alive, you can seek legal help for your case, but there is very little guarantee that you will get the full amount of your money.

2. Not Moveable

If you need to move to a different state, unfortunately, your prepaid funeral plan cannot move with you. You can no longer use the service should circumstances see you moving out of state. This will mean a loss of the money you already invested and incurring additional expenses of taking a new prepaid funeral plan.

If the prepaid funeral provider does make an exception to your case of allowing it to be transferred to your new location, be prepared to pay a whopping amount of penalty charges and administrative fees.

3. Integrity Issues

In a prepaid arrangement, the funeral provider will put all your money in a life insurance program, and they will be named the beneficiary as well. Once all your funeral arrangements are met, any remaining amount should ideally be given to your family. Unfortunately, some funeral homes deliberately add fees and other 'new' services so that they get to keep the entire amount of the leftover funds.

4. Inadequate Customer Protection

In the event that you need to cancel your prepaid funeral plan, you might end up losing half of the money you've already paid the company.

Most US states are not required to issue full refunds should a client decide to cancel their prepaid funeral plans. If, in any case, you choose to take the case to court, the legal fees that you need to pay would be higher than the settlement or disbursement you hope to receive.

Laws safeguarding clients from rapacious funeral homes vary depending on the state, and you cannot trust these laws to safeguard you or your loved ones and the money you've spent.

5. Locked Contract

Since it is your own contract and your funeral plans, you should be able to make some changes even after the contract is drawn. No, we are not talking about major changes, just some minor alterations.

However, for most prepaid funeral plans, the funeral provider may not allow any specific requests or terms once the arrangement is finalized. Again, allowing you to push through with any changes may also mean paying additional administrative fees.

Smart Tips For Preplanning Your Funeral

Since there are multiple options for you to consider, you have to make sure that you identify what you really want before coming up with your decision. As morbid as it may be, this is ‘your’ funeral service that you are preparing for, so you need to give it a lot of thought and consideration, so it can be executed exactly the way you want it to.

If you feel the need to prepay your funeral by using the services of a funeral home, make sure you have written guarantees for everything including refunds, services you expect to be provided, and stipulations in case there is a need to transfer services to another service provider.

Here are a few tips on how to preplan a funeral for yourself.

TIP 1: Identify Needs & Wants

More often than not, we are influenced by what we see, hear, and even experience, so you have to know exactly what you want to take place when you are finally laid to rest. You need to be clear and confident about why you wish to preplan for your funeral. Your reasons matter because it will affect your overall decision.

Would you want a burial or a cremation? Would there be a graveside service or a church service? Remember, though, that although these are questions that you have to answer, you also have to take into consideration the family that you will leave behind. Will they find these pre-arrangements comforting and meaningful?

TIP 2: Invest In Research

You still have long years ahead of you, and there is no need to rush, so gather all your resources and invest in knowing everything about prepaid funerals and other alternatives. Even if you are set initially on a plan, you have to broaden your options. Don't allow yourself to be restricted with just one choice because there are so many alternatives that may suit you better.

TIP 3: Inquire For Multiple Quotes

Compare costs and inclusions from different providers in your area. Again, there is no need to hurry to get everything done and over with. Find out the services that will be included in each kind of plan.

Schedule appointments and communicate with multiple businesses. Do a comparative study and determine which of the quotes and bundles you received will work best with your budget and needs.

TIP 4: Involve Your Family

Being asked to help with preplanning a funeral might come as a shock to your family member and they might find it an uncomfortable topic. But introduce the idea to them and invite them to make decisions with you. Ask for their feedback and thoughts about a certain area.

This is not an easy idea to accept because discussions about death, especially that of a loved one are not the easiest topic to talk about. But making your wishes known and involving your loved ones in this process can prove valuable for everyone.

Prepaid Funeral: Frequently Asked Questions

Understanding every aspect of the prepaid funeral is important. Any form of hesitation or doubt should stop you from making a final decision.

While we have tried to cover all questions or concerns you may have about the rationality of a prepaid funeral, here are some commonly asked questions regarding the same. You can also reach out to your local funeral home for any clarifications that may need addressing before you make up your mind.

Should you prepay for your funeral?

The foresight to plan ahead and prepay for your funeral provides many valuable benefits as discussed above including:

  • It takes away the burden of making important decisions or managing urgent tasks from your loved ones especially when they would be going through a considerable emotional upheaval.
  • It gives you the peace of mind that comes from knowing that your wishes will be carried out exactly as expressed.
  • Another important reason why people consider prepaying for their funeral is to shelter their assets from Medicaid.

Who can avail of a prepaid funeral?

Anyone who is an adult meaning 18 years of age and older can avail of a prepaid funeral plan. There is no upper limit which is good news for adults. There are also no health or medical formalities that require to be completed.

Can I include special requests for my plan?

Yes, you can. Special requests usually involve a particular Bible reading, song choice, and information for the eulogy. These details can be added without additional charges. However, additional services that are considered as upgrades may entail extra cost.

Who receives the final prepaid funeral contract?

The following will each receive a copy of the final and signed prepaid funeral contracts:

  • You or the funeral recipient
  • The person assigned to the contract
  • The next of kin of the plan holder

How will the funeral company know about my death? (Or in case given to someone else, the plan holder’s death)

This is where your immediate family or executor comes into play. Another reason why you need to let them know about your existing prepaid funeral because it will be their responsibility to let the provider know that you have passed on.

Which is a better payment scheme?

There is no better choice because all payment options depend on you and your financial standing. Obviously, with a lump sum, the money required is upfront. This can make a dent in your budget, but on the positive side, you still have time to earn it back, and the financial impact is one-time.

Meanwhile, a deferred payment option is convenient especially if you are on a tight budget since you can spread the cost over a period of 12 months or more.

What if I die before I complete the payment?

The plan will still push through as originally arranged. It will however be the responsibility of your immediate family or estate to pay the difference. 

Will I still qualify if I have a pre-existing medical condition?

Absolutely yes! As discussed above, a prepaid funeral is not a medical policy. Anyone over the age of 18 can purchase a prepaid funeral plan at any stage of their life and irrespective of their health conditions. The costs are also not determined by age or medical conditions, unlike a medical policy.

What if funeral costs rise? Will I owe more?

The biggest advantage of investing in a prepaid funeral plan is that you buy one for future use but at the current rates. So, even if average funeral costs were to increase, yours will not, giving you the best of both worlds so to speak.

Is it necessary to prepay for a funeral if I already have life insurance?

Preferably yes. Life insurance is a lump sum settlement to the family of the deceased. That said there is no guarantee when it will be released. Life insurance settlements can be gainfully used to meet other “immediate or pressing concerns.”

Prepaid funeral plans on the other hand are funds set up specially to meet the expenses that will be incurred in arranging the funeral of your dreams.

Prepaying For Funeral Expenses: A Practical Approach

Making all the necessary arrangements for your eventual demise is as sensible and practical as taking a life insurance policy or a Medicaid policy.  The sooner you make plans on how you want your funeral to happen and settle the costs, the better.

Buying a prepaid financial plan makes perfect sense if you want everything to be as seamless as possible when that time comes without putting the burden of responsibility on your loved ones.

Exploring all your options for a prepaid funeral and being aware of the pros and cons of prepaid funeral plans can help you make a decision that you know will work out best for you and your loved ones.

A prepaid funeral is not for everyone, and as morbid as it may sound there is no harm in securing the peace of mind that comes from knowing your wishes will be carried out to the tee without putting the onus of the responsibility on your family. Every human being ends the same way, but with a little foresight and planning, you can make your grand exist exactly the way you want and rest in peace knowing that your family is free of any financial burden.

Helpful reading:

Healing After Loss Through the Grieving Process
How To Have A Funeral When You Don't Have Any Money
A Complete Guide To Funeral & Burial Traditions

December 8, 2020 by Frances Kay