Funeral Costs: A Top Objection to Funeral Pre-Planning

“It takes as much energy to wish as it does to plan,” said former first lady Eleanor Roosevelt. While funeral planning wasn’t likely on her mind, that sentiment remains true. Funeral costs are one of the top objections we hear when it comes to planning. There are some misnomers about funeral pre-planning and prepaying  out there that we’d like to clear up with this second post in our series about funeral planning objections.

Objection: I don’t want to spend money on something I don’t need now.

You’re young(ish), healthy and smart with your money. That’s wonderful, but as mentioned in our first post on End of Life Planning, unexpected deaths occur each minute of every day. You may think funeral pre-planning isn’t in your purview, but it probably should be. Even if you don’t want to consider prepaid funeral plans at this moment, letting your wishes known is the first part of planning (and we’d tell Mrs. Roosevelt the same thing).

Going one step further and prepaying for your funeral arrangements, you lock in your service at today’s price. Once you pay for a funeral, Phaneuf guarantees in writing that the total price of our services and the merchandise you select will never increase in cost. Prepaid funeral plans are ultimately a financially wise decision. It’s  important to note that not all funeral homes offer a locked-in price guarantee.

Objection: I don’t have the money for this now.

Often, funeral costs make a stressful time even more unpleasant for families as they scramble to determine what to choose and how to pay for it. You may not be aware that many people pay for their funeral in a lump sum, but you can also set up a payment plan that’s convenient for your financial situation. Also, you can use the current value of an existing life insurance policy to pay for your funeral without ever having to cash in the policy. We’re happy to lay out all payment options for you.

Objection: What are you going to do with my money?

Any funds received for prepaid funeral plans go into an Irrevocable Mortuary Trust account in accordance with state law. The trust is insured and the funds gain interest. The interest is  used to offset future price increases. We annually pay your taxes and administrative fees in the trust. No one can access the funds or cancel the trust. By law, the funds are only for the service you selected, and withdrawn only at the time of death.

Objection: What happens if you close before I die?

In New Hampshire, the funds paid for funeral services are not assets of a funeral home. The funds can only be withdrawn from the aforementioned trust at the time of death and upon submission of a death certificate and letter from the funeral home stating that they rendered the service. If a funeral home closes for whatever reason, they generally  contract with another funeral home in the vicinity to take over the prepaid accounts. The family will be notified if another funeral home takes over the account, and the family can choose to stay with the new funeral home or transfer their prepaid arrangements to another funeral home of their choosing. The funds are protected by law.

For example, when a Manchester, NH, funeral home closed its doors, Phaneuf negotiated an agreement with the owner to honor all existing prepaid arrangements. Phaneuf notified everyone and told them Phaneuf would honor their arrangements as planned, or they could transfer the arrangements elsewhere. No one chose a transfer.

We understand funeral costs are not to be taken lightly, which is why we answer frequently asked questions one-on-one or in this manner. Having as much information available as possible helps many people make educated decisions and eases nerves. We’ll continue this series of funeral planning objections soon.