As I was driving through Georgia scanning radio stations, I heard Clark Howard’s characteristic voice come belting through my speakers. I almost let the radio keep scanning, but I heard the word funeral. As morbid as that is, this class has attuned me to news of anything pertaining to death. Clark Howard received a call from a woman in her late fifties. She wanted his advice on prepaying for a funeral. Prepaid visa gift cards are normal, prepaid cell phones have had their time, but prepaid funerals? It sounded like a good idea to me. People pre plan funerals so why not pay for them ahead of time as well? If you have the means, you plan on leaving your children with enough money to cover your funeral expenses, so why not pick everything out ahead of time, pay for it, and save everyone the hassle? Three reasons:
As Americans are living longer and traveling is becoming more accessible, families often scatter across the country and sometimes the globe. People typically start prepaying for funerals around the age of 50, but it is becoming increasingly more likely that the place you live now may not be the place you end up at the end of life. Many prepaid funerals will not transfer your funds to another funeral home, nor will they give you a complete refund.
2. Changes in End-of-Life Wishes
Between prepaying for a funeral and the actual time of death, a person’s end of life wishes may change. For example, more and more people are opting for cremations. However, if you prepaid for a funeral and chose to change your plans, the money will most likely not be refunded.
3. The Shady Funeral Director
With prepaid funeral plans there are no guarantees to protect your money from being stolen. Some funeral directors can take advantage of customers.
Many people opt for a Pay on Death Savings account instead of a prepaid funeral. A Pay on Death savings account is an account that will be cashed out to a beneficiary at the time of death. In the end, the pros and cons are yours to weigh, just as your funeral arrangements are yours to make.