Understanding the benefits of planning ahead, the differences between pre-paying and pre-planning, and more

In today’s day and age, preparedness is something we value now more than ever. We want to be ready for anything and everything that the world has in store for us — that’s why funeral pre-planning has been steadily gaining traction among people looking to ease the burden on their families during one of life’s most challenging times. 

Funeral pre-planning, essentially, is the process of arranging and paying for a funeral service well in advance. This plan not only spares your family and loved ones from the emotional and financial strain of making decisions during a period of grieving, but also offers financial benefits by allowing you to lock in current funeral service prices and avoiding inflation. 

The cost of funerals in the United States can vary widely, with the national average for a traditional burial service ranging from $7,000 to &12,000, although cremation services typically average slightly lower. These figures can encapsulate everything from the funeral home, the service itself, cremation, and the casket or urn. With prices constantly fluctuating and increasing, pre-planning lets you save a lot of money by buying at lower, more current prices.

Pre-Paying vs. Pre-Planning

Understanding the difference between pre-paying and pre-planning is crucial. Pre-paying involves paying for a funeral at current prices, thereby saving thousands of dollars and avoiding future inflation. If you need help estimating any potential costs, you can use AfterLife HQ’s embedded calculator and see how much you can save by pre-paying. 

Pre-planning, meanwhile, does allow you to plan your funeral arrangements in advance, but may or may not include the option to pay for it. 

Pre-need contracts, governed by varying state laws, outline the specifics of pre-paid funerals. These laws ensure that the funds paid in advance are protected and will be available when needed. There are usually two ways to pay for pre-need funerals: through a trust fund or insurance. Each has its own regulations, coverage, and management, such as cash advance items like flowers or obituaries. 

Furthermore, contracts can be either revocable, which means that they can be changed or refunded, or irrevocable, meaning that they cannot be undone once the plan has been made. All details aside, pre-paying, in essence, helps to provide peace of mind and financial security to both the beneficiary and their surviving family members. 

Why You Should Pre-Plan A Funeral

You’ll find that pre-planning a funeral offers many advantages, including:

• Financial Control: You can lock in prices before inflation and prevent more costly decisions.
• Emotional Support: This reduces the emotional burden on you and your family members and  provides comfort during a time of grief.
• Guaranteed Wishes: You can ensure that your funeral goes exactly the way you want it and your final wishes are honored and respected.
• Potential Medicaid Benefits: Some pre-need arrangements can help in qualifying for Medicaid by not counting as an asset.
• Flexible Planning: Some plans allow you to consider and change plans without financial penalty, in most cases. 

How to Plan a Funeral

So you’ve decided to pre-plan a funeral? Great! Here are the important steps you need to consider when making funeral arrangements:

1. Research the Type of Service You Want: Choose whether you want a traditional burial, a cremation or any other type of service offered. Understanding every option is crucial.
2. Select a Funeral Home: Find a funeral home you like, or several, and compare services and prices. Resources like the Federal Trade Commission’s Funeral Rule can provide guidance on what to look for.
3. Detail Your Wishes: This can include everything from the music you want to be played during the service to the kinds of flowers you want. 
4. Consider Your Finances: Decide between pre-paying or simply pre-planning. If opting to pre-pay, choose between trust-funded or insurance-funded arrangements.
5. Inform Your Family: Share your plans with your family members and ensure that they are aware of your specific wishes and arrangements. 
6. Document Your Plans: Keep a written record of your plans, contracts, and receipts and keep it in a safe place. Ensure that a trusted family member knows where to find them, or you can entrust it to them in advance. 

Mistakes to Avoid When Planning a Funeral

As with plenty of things, you’ll want to avoid making as many pitfalls as possible, especially for something as serious as this.

1. Not Shopping Around: It may be easier to just pick one funeral home or plan and go with it, but by failing to compare prices, you may be spending more money than you have to.
2. Overlooking The Fine Print: Not understanding the details of pre-need contracts can result in unwanted surprises down the line. 
3. Forgetting to Plan for Cash Advance Items: These are not typically covered in pre-need contracts and may add up in the future.
4. Choosing the Wrong Funding Option: Each option has its pros and cons, depending on your financial situation and wants, so make sure to pick the one that best suits your needs.
5. Not Informing Your Family: Your plans can’t be followed through if no one knows about them. Make sure that the people most important to you or the ones who most need to know are informed of your decisions. 

In conclusion, pre-planning a funeral has many benefits — allowing you to ease financial and emotional strain and ensure that your final farewell goes all according to plan. With tools like AfterLife HQ, navigating these difficult decisions is made easier, with our extensive pricing data, guides, and directories that are here to assist in the planning process. By taking control now, you can provide peace of mind for both yourself and your loved ones, making a difficult time a little easier to manage. 

Sources

• Federal Trade Commission’s Funeral Rule: FTC Guidelines for Funerals
• National Funeral Directors Association: NFDA Cost of Funerals
• Consumer Price Index Inflation Calculator: Bureau of Labor Statistics CPI Calculator