A prepaid funeral is different than preplanning your funeral. When you choose to preplan your funeral, you go over all the plans you want for final arrangements with a funeral director, but typically don't pay him or her for the services save perhaps a small deposit. When you prepay for a funeral, you make your own selections for various services and then pay for those things once you sign the contract.
Prepaying for your own funeral has many benefits; note a few of them here so you can determine if this is the right choice for you. It's also good to understand some of the details involved so you know what to discuss with a funeral director.
1. Prepaid funerals ensure that money is set aside for the funeral
You don't need to worry about how your children or other heirs will pay for a funeral when you prepay. This allows you to choose the details you want for a funeral and ensure that your wishes will be followed without your heirs saying that they cannot afford such arrangements. It also allows you to know how much money will be left over after your funeral costs so that you can better compose a will.
2. A prepaid funeral can be guaranteed
When prepaying for a funeral, you may be offered a guaranteed funeral versus a nonguaranteed funeral. Nonguaranteed means that the funeral director may reserve the right to make changes to the arrangements as circumstances change. For example, you might pick out a particular casket but in a few years, that type of casket is no longer available. With a nonguaranteed funeral, the funeral director may choose something similar.
With a guaranteed funeral, this means that the every detail you decide on will be followed exactly. A funeral director will provide all the arrangements as they're spelled out. If you opt for this type of prepaid funeral, it may be more expensive but you know that everything will be conducted at your funeral according to your plans.
3. You may spend down your assets
To avoid certain tax bills or to become eligible for government aid as you get older, you may need to spend down your assets. In some cases, a prepaid funeral can accomplish this. You know your heirs will need to pay for your funeral anyway, so paying for this expense before you pass away can allow you to reduce the size of your estate or show less money in a bank account, without necessarily taking money away from what you leave for your heirs.Share