Death eventually comes for everyone. Acknowledging this and pre-planning and pre-paying for your funeral can take a load of stress off your family during this difficult time. Funeral pre-arrangement plans guarantee you get the service you want and allow you to lock in today's pricing for this later event. Pre-paying even gives you numerous payment options. Here are a few ways to do so.
1. Buy An Insurance Policy
The average funeral cost is quickly approaching $8,000 or more, depending on where you live. Add a grave marker and other miscellaneous expenses, and you can easily spend more than $10,000.
One of the easiest ways to pay for your funeral is to purchase a final expense insurance policy to cover the cost. You can buy a policy for the monetary amount of your funeral pre-arrangements and make the funeral home the beneficiary. The funeral home often offers this type of policy, or you can purchase it through an outside insurance agent.
Paying for your pre-arrangement this way means that once you die, the funeral home files for the death benefit of the policy and pays off your plan. Your family will not have to worry about footing the bill. Your designated beneficiary will receive the entire policy value of any other life insurance.
2. Pre-Paid Funeral Trust
A pre-paid funeral trust is another way to pay for your funeral arrangement plans. You place funds in an interest-bearing account where they will accumulate interest until you die.
If you create a Payable on Death (POD) account, you control the funds until you die. Once you die, your designated beneficiary uses the funds to pay for your service.
The beauty of a pre-paid funeral trust is that these funds are exempt from the Medicaid spend-down rules. While most states cap the amount you can place in the trust, this is one asset you can retain and still qualify for Medicaid.
3. Joint Bank Account
One of the most straightforward ways to pre-pay for your services is to establish a joint account with a family member you trust. Make sure you set the account up with Rights of Survivorship. Once you pass, the other person on the account can then use the funds to pay for your service.
Because their name is already on the account, they will have immediate access to the funds. They will not have to wait to settle the estate for funds to pay your funeral pre-arrangement plans.
Contact a local funeral home to learn more about funeral pre-arrangement plans.
Share28 November 2022
My beloved paternal grandmother passed away almost 4 years ago. Before her death, this special woman suffered many months due to a fatal lung disease. After her passing, her large extended family wanted to celebrate her unique life with an elaborate funeral service. They chose to work with the funeral home staff to decorate the funeral venue with things she loved. Because she enjoyed fishing, a large floral arrangement in the shape of a fish was purchased. Also, the family bought a floral cross to illustrate her devotion to her faith. On this blog, you will discover how to work with a funeral home staff on decorations at the funeral service venue.
