Exploring the growth of pre-paid funeral plans as a financial planning tool

Planning for the future is a crucial part of financial responsibility. While many people focus on saving for retirement or their children’s education, an often overlooked aspect is funeral planning. Funerals can be unexpectedly expensive, putting a financial burden on grieving families. This is where pre-paid funeral plans come in as a smart way to ease that burden and ensure your final wishes are carried out. In this article, we’ll delve into what pre-paid funeral plans are, their benefits, and how to go about setting one up, including tips on designing personalized funeral programs with template.

What are pre-paid funeral plans?

A pre-paid funeral plan is an arrangement where you plan and pay for your funeral service in advance, locking in today’s prices. You choose the funeral home, services, and merchandise you want, and the funeral provider puts your money in a trust or buys an insurance policy to cover the future cost of your funeral. 

The specifics can vary, but pre-paid plans generally cover:

– Professional services fees for the funeral director and staff

– Transfer of the deceased from the place of death to the funeral home

– Preparation of the body (embalming, dressing, casketing)

– Visitation or viewing 

– Funeral ceremony

– Transportation to the cemetery

– Casket, vault or cremation urn

– Funeral program printing

By pre-paying, your survivors won’t have to make these decisions under duress or worry about payment while grieving. The funds are protected and ready to be used immediately upon death.

Benefits of pre-paying for your funeral

There are several compelling reasons to consider a pre-paid funeral plan:

1. *Financial security for your family*. Funerals can cost upwards of $9,000 on average. Pre-paying shields your loved ones from sudden expenses and difficult financial decisions during an already stressful time. The burden of payment is lifted from their shoulders.

2. *Locked in prices*. By paying now, you secure a guarantee that no matter how much costs go up in the future, your funeral is fully paid for at today’s prices. If you live another 10, 20, or even 30+ years, you’re protected against inflation. Think of it like buying funeral services in bulk ahead of time.

3. *Personalizing your memorial*. Pre-planning lets you design your farewell down to the smallest details – the songs, prayers, readings, and more. You can even custom-design a funeral program template with a service like FuneralFolio. Your wishes are clearly spelled out, giving you peace of mind and reducing stress for your family, who won’t have to guess what you would have wanted. 

4. *Medicaid/SSI “spend-down.”* If you may need to go on Medicaid or SSI in the future, pre-paying for funeral expenses may be a way to spend down your assets to qualify. Irrevocable funeral trusts are often exempt from asset limits. Consult with an elder law attorney to explore this option.

5. *Transferability*. What if you move? Most pre-paid plans can be transferred to a different funeral home if needed, although some may charge a fee. Certain plans even include coverage for travel protection so if you pass away while traveling, the cost of transportation is covered.

Common questions about pre-paid funeral plans

Q: How do I know my money will be safe?

A: Each state has different laws regulating pre-need funeral contracts. Most states require the funeral home to place your pre-payment into a trust account that’s overseen by the state, or purchase a life insurance policy with the death benefits assigned to the funeral home. These protect your investment and ensure the funds will be there when needed. Always verify the specifics with the funeral provider you’re considering.

Q: Can I change my mind about what I want after I’ve pre-paid?

A: It depends on the plan. Revocable plans can typically be changed but irrevocable ones usually can’t (that’s what makes them exempt for Medicaid). Even with revocable plans, there may be fees involved in making changes, so be sure to ask.

Q: What if the funeral home goes out of business?

A: Again, this varies by state law and the individual plan. Most states have protections in place where if a funeral home closes, your pre-paid funds will be transferred to another funeral home of your choosing. The key is to make sure you understand the specific terms of cancellation and transfer for the plan you select.

Setting up a pre-paid funeral plan

If you’ve decided that a pre-paid plan is right for you, the process is fairly straightforward:

1. Research funeral homes in your area and compare prices. Don’t be shy about asking for itemized price lists – the FTC Funeral Rule requires funeral homes to provide these to any customer who asks. 

2. Set up a meeting with the funeral director to discuss your options and design your plan. Bring along a family member so they are familiar with your wishes.

3. Review the contract carefully. Make sure you understand exactly what is and isn’t covered, from merchandise to burial plot to taxes. Verify the plan is transferable if you move. 

4. Keep your paperwork in a safe place and make sure your executor and loved ones know where it is.

One important aspect of funeral planning is designing the funeral program. This printed piece serves as a guide to the service and a cherished memento for attendees. Rather than leaving this task to your grieving family, you can actually design your own program in advance with the help of funeral program template providers like FuneralFolio.

By designing your funeral program ahead of time and specifying that the template be printed and used in your pre-paid plan paperwork, you relieve one more burden from your loved ones. It’s a small detail that can make a big difference in their stress levels during an already difficult time.

Key Takeaways 

– Pre-paid funeral plans allow you to arrange and pay for your funeral ahead of time, locking in today’s prices

– Benefits include financial security for your family, ability to personalize your memorial, potential Medicaid spend-down, and more

– Each state has different laws; always verify the plan details and consumer protections 

– Services like FuneralFolio allow you to custom-design elegant funeral program templates in advance

– Proactive funeral planning provides invaluable peace of mind for you and your loved ones 

No one likes to think about their own passing, but a little bit of planning now can make a world of difference for your family later. Pre-paid funeral plans offer a smart, responsible way to make your final arrangements simple, affordable, and meaningful. By taking control of these important decisions now, you give your loved ones a priceless gift and free them to focus on what matters most – celebrating and honoring your life. Contact your local funeral provider to discuss pre-payment options and start designing a memorable farewell with FuneralFolio’s funeral program templates today. Your future self and your family will thank you.