Should you prepay for your funeral?
Many individuals take the time to try to preplan their funeral arrangements in an effort to make things easier on those left behind. From choosing the type of casket or cremation urn they prefer to selecting a grave plot or burial site, preplanning has its benefits to the family of the deceased. You are leaving the family with fewer decisions to make and also assuring them that your wishes are being carried through. But the question that arises is while planning for after you pass can be a good idea is it wise to prepay for your funeral costs?
Preneed is a term that is often used to describe preplanning and prepaying for your funeral ahead of time. Funeral homes are seeing a steep increase in preneed planning and several funeral parlors and homes have various packages that you can purchase that will outline your terms and wishes with regards to caskets, cremation urns and other services. The benefits to preneed planning include making sure your wishes are carried through, comparison shopping without the hassle of time being short and knowledgeable decisions that are not compounded by grief.
There are however some downsides to preneed planning and purchasing that every consumer should be aware of. Should you move out of state from where you originally purchased your preneed funeral services you generally cannot transfer the services to a different funeral home or have your money refunded. Also, due to the cost of inflation, understand that the monies that have been paid may not cover all expenses down the road when the funeral service actually takes place. If for some reason the funeral home that you purchased your preneed arrangement from is no longer in business at your time of death, the agreement may or may not be honored.
There are important factors that you should take into consideration before purchasing a preneed funeral arrangement. Make sure that your plan allows for a full refund with no penalty. The money that you prepay for your funeral should be placed into a trust such as a Totten trust which is regulated by the state government. You want to be sure that your plan can be transferred in the event that you move before your death and you should receive a written guarantee that states the original price plus any accrued interest will cover the cost of the funeral arrangements you have set forth. Any leftover funds from your preneed payment should be refunded to the estate and this should be stated clearly in your written guarantee.
Preplanning and prepaying for your funeral can be of significant help to your family that will be overcome with grief at the time of your passing. Preneed arrangements allow you to choose the cremation urn or casket as well as the type of ceremony and other arrangements that you want on the day of your funeral. It is wise to receive a written guarantee agreement before paying that states what you are covered for and against before releasing the funds to a trust.