Benefits of Funeral Preplanning and Prefunding
In recent years, more and more people have opted to make funeral or
cremation arrangements prior to their death. These arrangements are
commonly referred to as funeral preplanning or prearranging.
Many people find that funeral preplanning gives them peace of mind
knowing that their wishes will be respected and that the family
has fewer burdens from making decisions about funeral arrangements
during a time of grief.
Others find that by prefunding their funeral or cremation expenses,
any additional life insurance they already have purchased may be
used for its original purpose and not for funeral expenses.
There are several benefits to funding your funeral prearrangement
- The funeral services may be carried out at little or no additional
cost to your family.
- Funds may be immediately available to pay funeral costs, with
no waiting period due to probate or other delays.
- May prevent other life insurance policies from being depleted
at the time of a loved one’s death.
- Allows you to consider cost-effective options at a time when
you are better prepared to make sound, fiscally responsible decisions.
- There may be flexible payment options to meet your needs.
- In some states, prearranged funeral contracts may not be counted
as assets for Medicaid spend-down purposes.
- The death benefit of a preneed life insurance policy grows
over time to help offset inflation and that growth may not be
taxable to you.
- A preneed life insurance policy is portable; therefore, if
you move to another area, the insurance may be used to fund a
new prearranged funeral contract with the funeral firm of your