Should I Prepay?
There has been much hype in recent years regarding prepaying funeral expenses. In many situations, it may be of greater benefit to the funeral home than it is to the consumer. Since PEOPLE’S MEMORIAL wants all consumers to make informed decisions, we believe it is important for you to know both the benefits and risks of the different vehicles for prepayment. If you are considering simple, low-cost cremation, it just may not make sense to prepay. Many families can just write out a check for the cremation cost when the time comes.
For those who anticipate that they will need to spend down for Medicaid, the state allows you to set aside up to $1,500 in a bank account to cover your funeral expenses. There are many funeral homes that offer cremation for less than $1,500. If you are wanting burial, then prepayment may be advisable. There is a special form to submit with your Medicaid application if you wish to designate a funeral expense fund.
Prepayment in any form involves trusting that someone else will securely hold and manage your funds and deliver them in full to the funeral home of your choice at time of death. That means trusting that the bank, insurance company, funeral home, family or friend will perform their duties responsibly. Most funeral homes no longer guarantee funeral costs for prepaid plans. For complete information on this subject, please read our brochure The Benefits and Risks of Prepayment.