Prepaid Funerals

[calico1597]

Mom and I are meeting with the local funeral director tomorrow to discuss prepaying her funeral while she still has funds. She is now in a senior apartment, possible future assisted living then nursing home some day likely. Cash available is $250K, she does not have long term care insurance. She is 82. She has no life insurance.

What questions should we ask and any red flags to watch for? Dad died five years ago, we did a church visitation an hour before the service then burial. I think his funeral cost was around $7,000. The cemetery lot is paid for. She wants the same type arrangements he had.

 

[meierlde]

Mom and I are meeting with the local funeral director tomorrow to discuss prepaying her funeral while she still has funds. She is now in a senior apartment, possible future assisted living then nursing home some day likely. Cash available is $250K, she does not have long term care insurance. She is 82. She has no life insurance.

What questions should we ask and any red flags to watch for? Dad died five years ago, we did a church visitation an hour before the service then burial. I think his funeral cost was around $7,000. The cemetery lot is paid for. She wants the same type arrangements he had.

Note that in most states a prepaid funeral if held in an irrevocable trust is not counted in determining medicaid eligibility. (so best to prepay, instead of sticking survivors with the bills, (all be it cremations are far cheaper)

 

[Walt34]

We did a prepaid funeral for FIL but it was a few months before he passed, not years, and his passing soon was all but a certainty. Three years ago the cost was five figures, and that in a relatively low COL area of MD. Medicaid does not count it as an asset nor include it in the five-year lookback which is why we did it that way, since there was a possibility that he would exhaust his resources in the nursing home. State laws vary though, so check on that. One good thing I guess is that it does "fix" the cost of the funeral if one is perhaps years away from passing.

If your Mom is absolutely certain that those are the arrangements she wants then okay, but be aware it is probably irreversible. I think FIL's was. The money should go into an escrow or trust account where the funeral home cannot get at it until her passing. This is because there have been instances of funeral homes going out of business or bankrupt, taking the pre-paid funeral funds with them.

 

[meierlde]

We did a prepaid funeral for FIL but it was a few months before he passed, not years, and his passing soon was all but a certainty. Three years ago the cost was five figures, and that in a relatively low COL area of MD. Medicaid does not count it as an asset nor include it in the five-year lookback which is why we did it that way, since there was a possibility that he would exhaust his resources in the nursing home. State laws vary though, so check on that. One good thing I guess is that it does "fix" the cost of the funeral if one is perhaps years away from passing.

If your Mom is absolutely certain that those are the arrangements she wants then okay, but be aware it is probably irreversible. I think FIL's was. The money should go into an escrow or trust account where the funeral home cannot get at it until her passing. This is because there have been instances of funeral homes going out of business or bankrupt, taking the pre-paid funeral funds with them.

Some funeral homes may also do it thru an insurance policy (essentially life insurance with the funeral home providing the service as the beneficiary)

 

[Bamaman]

My parents had prepaid funerals through a locally owned funeral home. We ended up going for better caskets ($350) and better flowers for the casket cover ($350).

They would have been better off just putting the funds the prepaid funerals cost into a separate savings account.

 

[meierlde]

My parents had prepaid funerals through a locally owned funeral home. We ended up going for better caskets ($350) and better flowers for the casket cover ($350).

They would have been better off just putting the funds the prepaid funerals cost into a separate savings account.

One thing a prepaid plan also does is to freeze the base charge. But the main advantage if possibly having to use medicaid for long term care is that the funeral is then paid for, and does not count towards the asset/income limits for medicaid. Otherwise surviors will have to pay for the funeral out of their pockets, since a living person does have to sign agreeing to pay if need be to get funeral services.

 

[Koolau]

All 4 of our parents (DW's and mine) preplanned and prepaid. All set the payment up as an insurance contract to be paid out at the time of death. The funeral home pledged (in writing) to honor the terms for the payout of the insurance contract. Three of the parents used the "system" as designed at the appropriate time. When DW's mother passed, DW wanted to use a different funeral director (long story). As it turns out, the insurance contract IS transferrable to another funeral home though that funeral home is under no obligation to honer the original agreement that was made with the original funeral home. For us it worked out fine as the other funeral home DID honor the agreement (they wanted the business.)

Preplanning/paying turned out to be a good move since both sides of the family died with essentially zero assets left - the insurance contract was not touchable had that become an issue. YMMV

 

[youbet]

When it became apparent that NH dwelling MIL was going to outlive her wealth and wind up on Medicaid, we arranged for a prepaid funeral and grave site. In Illinois, a certain amount is allowed to be spent on a prepaid funeral and grave site that does not count as disqualifying assets for Medicaid and that amount of her money is what we spent. The funeral home and cemetery were very familiar with the process, offered packages aimed at this market and there wasn't much to it as I recall.

Other than as a pre-Medicaid move, I wouldn't buy a prepaid funeral. Too inflexible. Too risky (the industry is littered with crooks and high pressure salespeople). And I've yet to hear of a situation where the prepaid cost was a bargain compared to buying when the need occurs.

Cemetery lots are another matter. If you want to be at some specific place (for whatever reasons, strictly up to you), you do need to own that place before someone else does.

 

[Danmar]

When it became apparent that NH dwelling MIL was going to outlive her wealth and wind up on Medicaid, we arranged for a prepaid funeral and grave site. In Illinois, a certain amount is allowed to be spent on a prepaid funeral and grave site that does not count as disqualifying assets for Medicaid and that amount of her money is what we spent. The funeral home and cemetery were very familiar with the process, offered packages aimed at this market and there wasn't much to it as I recall.

Other than as a pre-Medicaid move, I wouldn't buy a prepaid funeral. Too inflexible. Too risky (the industry is littered with crooks and high pressure salespeople). And I've yet to hear of a situation where the prepaid cost was a bargain compared to buying when the need occurs.

Cemetery lots are another matter. If you want to be at some specific place (for whatever reasons, strictly up to you), you do need to own that place before someone else does.

I agree that the basic financial deal is not great. My mother prepaid her funeral over 20 years ago. She picked the funeral she wanted and deposited the full amount with the funeral home. These are kept in trust with a big bank. So you are really just "freezing" the funeral cost.

She is currently almost 92 and still going strong. No issues in Canada trying to qualify for govt assistance. However, it does provide some piece of mind I think. Hopefully, it will make my job easier once the time comes.

 

[easysurfer]

My plan is to have a prepaid funeral arrangement for myself. I've always been an independent type of person and guess even when kicking the bucket, that's no exception. Plus, by planning ahead, I have more of a say as to what type of arrangements I want.

 

[kcowan]

When Dad died at 95, Bro and I paid for 3 days of visitation and then a service and interment. It was in the same place that Mom had been done. We chose a nice walnut casket. Because all the ministers he knew had died, I supplied a speech and poem for the stand-in to read. In all, 650 people showed up. Everyone loved it.

Burial plots had been purchased 45 years earlier and seemed cheap by then. So the overall price was reasonable even though the funeral home was expensive.

 

[LARS]

Not to be a wise ass (well maybe a little) I thought the goal was to have the check for the funeral home bounce as the decedent's last earthly financial funds are depleted? Doesn't prepaying go against this Cardinal Rule?

 

[Danmar]

Not to be a wise ass (well maybe a little) I thought the goal was to have the check for the funeral home bounce as the decedent's last earthly financial funds are depleted? Doesn't prepaying go against this Cardinal Rule?

To state the obvious. You pretty well need to know when you are leaving or have annuitized all your assets, for this to be feasible. If your post was supposed to be funny, sorry I missed it.

 

[LARS]

To state the obvious. You pretty well need to know when you are leaving or have annuitized all your assets, for this to be feasible.

I was just having a little fun before the weekend starts. It is Friday, right? Been hard to keep track of the day of the week after so many years as a bum...

In all seriousness, I consider one of my life's goals is to get to my grave having managed to pay my own way in this life. So bouncing my last check as I shuffle off this mortal coil has never been a goal of mine...

 

[Brat]

Before you sign up for a prepaid funeral take a look at the Memorial Association for your state. They have contracts for services with funeral homes. Also Costco sells caskets and urns.

 

[Teacher Terry]

My parents bought their lots when my grandparents died. So they had them for a long time before needing them. Then at age 60 my Mom had a joint headstone bought and engraved. It was kept inside until my Dad died. My Mom lived to almost 90 so certainly got a much cheaper cost. I am the guardian for my friend with Alzheimer's and after she got on Medicaid we were told to prepay her funeral expenses so her money would not build up. We did this. It is weird but she can't afford the amount of the home but Medicaid told us we only owe 1000/month and within a few months we would have more then 2k and get kicked off. We were told that the solution is to send the home extra money each month to keep the account at less then 2k so that is what we do. Her Medicaid SW has been a great help advising us on such things.

 

[Danmar]

I was just having a little fun before the weekend starts. It is Friday, right? Been hard to keep track of the day of the week after so many years as a bum...

In all seriousness, I consider one of my life's goals is to get to my grave having managed to pay my own way in this life. So bouncing my last check as I shuffle off this mortal coil has never been a goal of mine...

. Its never been one of my goals either. Cheers

 

[Blue Collar Guy]

My father like myself was old fashioned. He bought in 1969 a plot and a stone, he didnt want my mother to have to worry about arrangements. he was 42 years old. He died sort of suddenly at 57, we were so distraught we could barely breathe let alone make arrangements. So read this https://www.elderlawanswers.com/pre-paid-funeral-plans-buyer-beware-1098, and best of luck.

 

[Walt34]

My father like myself was old fashioned. He bought in 1969 a plot and a stone, he didnt want my mother to have to worry about arrangements. he was 42 years old. He died sort of suddenly at 57, we were so distraught we could barely breathe let alone make arrangements.

One of the best things my mother ever did for me and my sisters was to pre-plan her funeral. About the only decision we had to make was what kind of flowers to get at a time when none of us was in condition to make sound decisions. She didn't really need to pre-pay it as she had sufficient assets/insurance that Medicaid was not even on the horizon.

 

[Teacher Terry]

Because my Mom was dying of cancer she had plenty of time to plan. Not only did she buy everything but picked out the songs to be sung at her funeral and asked who she wanted to sing. She wrote her own obit so not much for us to do. She even got rid of a ton of her stuff. Basically we had to get rid of what was left in her apartment and sell her car. when my grandfather died nothing was planned and it was horrible to make decisions when you are grieving. That spurred the remainder of the family to all take action young. We have our cremation site and plaques.

 

[Sanstar]

I've met with a Neptune Society rep x 2 and am seriously thinking this may be the way for me. Does anyone have any experience with a relative who passed with a Neptune Society plan in place? Any regrets?

 

[GalaxyBoy]

My dear old dad passed away in March. I thanked him (in person) for pre-paying his expenses a few years before he died, and again afterwards. It certainly took a lot of hassle off of me; being his executor, I've been busy enough with other things.

Just saying it's a good idea for the family, especially.

 

[bhoferp]

We didn't have a great experience with my parents pre-paid funeral plan. When my Dad passed the funeral home claimed my parents hadn't paid for some of the services. My Mom had the original contract and it was eventually worked out, but it was a hassle. Not what you want to have to deal with when you are grieving. Since we knew of the trouble when my Dad passed, my brother and I showed up at the funeral home original contract in hand when our Mom passed. By this time, a different company had taken over. At first they tried to charge us for items already paid for, until we showed them the original contract. They then asked to make copies of it. We agreed, but they were gone a really, really long time with our contract (like 30-45 minutes). We kept asking what was taking so long and they kept giving us excuses. I was really worried, but they finally came back with our contract. Again, not something you want to deal with when you are grieving. I would only pre-pay for Medicaid purposes.

 

[meierlde]

Not to be a wise ass (well maybe a little) I thought the goal was to have the check for the funeral home bounce as the decedent's last earthly financial funds are depleted? Doesn't prepaying go against this Cardinal Rule?

Note that the funeral director will require a person alive to take responsibility for the bill if not paid after some time (they have to sign when the arrangements are made). So all this does is to transfer the bill to one of the survivors (if there is no one the state will ultimately in many places provide a cremation, increasingly they are doing this since it costs so much less than a burial)

 

[John Galt III]

Preplanned is good, I think. So many problems with unplanned. Grief. Panic. Coroner and cops milling around, demanding you make plan "now" for burial or cremation. No one is allowed to recommend any good inexpensive funeral homes, etc. Pressure. Pressure. You're looking through yellow pages, no one answers the phone at the funeral homes, but you can leave a message. Then you find out cremation will cost $3,500. What? That's inexpensive? And the funeral home contract states they will charge you $2,000 to transfer the body to another funeral home. It's all a huge ripoff for the unplanned situations. You find out later you could have had a preplanned cremation for $1,900 at a different funeral home. But $1,900 is way too much also. So weird. Profits must be enormous. Where are these $500 cremations one hears about?