Pre-Plan Your Funeral, But Be Cautious About Pre-Payment
March 25, 2012
A funeral comes at a time when the death of a loved one is recent and close, and many people are still in shock and in some cases struggling with the reality of loss. Funerals help grieving loved ones come to terms with death and say their final goodbyes… but for the person planning the funeral the experience can sometimes be a frustrating, painful, and expensive experience. Planning ahead for your own funeral—discussing it with your loved ones and even including your wishes in your estate plan—can remove this burden from their shoulders when the time comes.
Although pre-planning a funeral is essential, pre-paying for a funeral can actually be detrimental. According to The Funeral Consumers Alliance there are just too many things that can go wrong, “[prepaying for] funerals may not cover every item of service you and your family expect, and there’s often no guarantee the money you pay today will keep up with inflation to pay the cost of the service you’ve picked out.” In addition, “many state laws don’t offer much protection for your prepaid funeral money.” If you change your mind or move out of the area there’s no assurance that you’ll get your money refunded. That being said, although pre-paying may be a no-no, setting aside funds for a funeral—in an account, CDs, or a specially designated insurance policy—is always a good idea. Consider setting aside funds in a Pay-On-Death bank account: the funds would be immediately payable on your death to someone you trust, who then would use them to pay for your funeral expenses. The POD account is sometimes called a “Totten Trust” account.
In just about every will or trust you will find something about the estate “paying the deceased’s final expenses,” otherwise known as funeral and/or memorial costs. As a small portion of what can sometimes be a very large and intricate document, this “final expense” clause can seem unimportant—but our firm knows better.
Talking about your wishes for “final disposition of your remains” is something that should always be discussed with your estate planning attorney. Whether you choose to pre-plan your funeral or not, having some basic instructions in your will or health care directive for your preferences regarding burial, cremation, organ donation and so on will be a huge help to your loved ones during a difficult and emotional time.
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