Regardless of your age or financial situation, it’s smart to preplan your funeral. That way, your family will know exactly what you want when the time comes. Even better, you get to make your own decisions about the type of funeral you want. As an added benefit, when you preplan your funeral you can better control the cost of the funeral.
One big misconception is that when you preplan, you have to prepay. Not so. It doesn’t have to cost you a cent to preplan your funeral. Of course, you can prepay if that works for you, and we’ll talk about that later, but right now let’s focus on preplanning.
Simply put, preplanning means that you set out the details of how you would like your funeral arrangements handled. Your plan can be as basic as stating how you would like your body handled (i.e. burial versus cremation) or as detailed as outlining every element of your ceremony from the music that’s played to who you would like to offer a eulogy. In other words, you are leaving instructions with your loved ones so they can handle the details. There is no payment required to preplan a funeral.
The key thing to remember is that regardless of your financial situation you can preplan your funeral without making a significant financial commitment. Of course, it’s best to set aside the funds to accomplish what you want and there are many ways to do that. Our Paying for a Funeral page can help you understand your options.
FUNERAL PREPLANNING: COMMUNICATING YOUR WISHES
One of the most important steps in the funeral preplanning process is letting your loved ones know that you have a plan and what your preferences are. If you are using our Wise Planning System, you can take advantage of the Plan Guardian feature that allows you to share your plan with those you trust to carry out your wishes. If not, be sure to talk with your family about your plans.
Have questions about funeral preplanning?
Here are some of the questions that we hear most often.
Preplanning is the practice of choosing in advance how you would like your funeral to be handled. Some people create very detailed funeral plans while others sketch out a general outline. A funeral plan can be done in electronic form or as a hardcopy. However you decide to create your plan, you should make sure that you communicate your desires to your loved ones.
The terminology can be a little confusing. All of these terms refer to having a funeral plan before death has occurred. When you see the term prepaying, it means a type of formal arrangement where you pay for funeral products and services ahead of time. You sign a contract with a particular funeral provider, such as a funeral home, for goods and services that will be provided at time of death. When you sign the contract you can make payment directly to the funeral provider in a single payment or installment payments.
Another popular option is to purchase a funeral insurance policy that is payable upon death to cover the cost of the contract. This is typically referred to as preneed insurance. Preplanning or advance planning, on the other hand, is a process where you create a plan for how you would like your funeral handled. You do not have to commit to a funeral provider and your plan can be informal and non-binding.
All that said, these terms may be used interchangeably so make sure you know if they are referring to a binding prepaid funeral contract or just a non-binding funeral plan.
Some people choose to pay for their funeral expenses when they create their funeral plan. This ensures that the cost is covered and relieves their family of the financial burden of paying for their funeral.
Typically, prepaying involves entering into a contract with a particular funeral provider (a funeral home or cremation service). Of course you want to be confident that the provider or a successor provider will still be in business when the time comes to provide the funeral services. Prepayment can be made directly to the funeral provider or the contract can be secured with a funeral insurance policy. Installment plans are available with either option.
Funeral costs can also be covered without making a commitment to a specific funeral provider by purchasing a final expense insurance policy or depositing funds in a trust account or a payable-upon-death bank account.
No. It is a common misconception that preplanning means prepaying. You do not have to prepay, but you can. Making sure that funds will be available to cover your funeral cost is a sound financial decision, if you are able to do it. You have various options. You can enter into a contract with a funeral provider and prepay the provider or secure the contract with a funeral insurance policy.
Another form of prepayment is to set up a funeral trust or a payable-upon-death bank account with the funds to cover you funeral cost. Final expense insurance is another option to consider if you prefer a monthly payment plan and do not wish to commit to a specific funeral provider in advance.
When you record your funeral plan, you can specify the services and products that mean the most to you. For example, the type of casket may not matter to you so you may select a simple wood version rather than an expensive bronze style. Having multiple days for viewing or visitation can add considerably to the cost of a funeral. If the viewing isn’t important to you, you can let family know that through your preplanning. Families often overspend on a funeral so letting them know your wishes is a good way to control the costs.
The most important thing you can do to ensure that your wishes are carried out is to choose the people you designate to handle them carefully and make sure they are fully informed about what you want. Another important step is making sure that there are funds set aside to take care of your wishes. Our Paying for a Funeral page can help you get started.
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