Living Benefits of Preplanning Your Funeral or Cremation November 4, 2019

What are the living benefits of preplanning your funeral or cremation service?  There are many benefits of preplanning your funeral or cremation for your family after you pass away, but what about benefits while you’re still living?

Arrangements Can Be Changed

Even though your arrangements have been made in advance, they are still flexible, and can be changed at any time.  Many people who have prearrangements go the rest of their lives without worrying about funeral planning again, while others make changes to things like prewritten obituary notices every few years.  Some people even change service options completely if major life changes occur that no longer justify things like multiple days for a visitation period.

Cash Value

Another living benefit common to many policies is a cash value.  Unless it has been irrevocably assigned, many preneed policies are permanent life insurance policies that have a cash value.  This means that in the worst-case scenario, you could borrow against or surrender a policy to meet an immediate cash need.  Policy forfeiture is a last resort option, but it is a benefit to be aware of nonetheless.

Estate and Medicaid Planning

Preneed policies are also an essential tool for estate planning.  Your savings may provide for various life events like retirement, a new home, etc., but many are unprepared for how much rising healthcare costs will impact those savings.

It is not uncommon for someone to have to move into a nursing home or assisted living facility, only to find that they will soon exhaust their savings paying for it.  They then decide to begin to spend down their assets in order to apply for Medicaid.  It is crucial to have a preneed policy in place by this time, as it is one of the few sources of funds that are exempt from a person’s countable assets during the application process.

Arrangements are Transferrable

Some people are reluctant to make prearrangements because they spend time between homes or tend to move frequently, but preneed policies are generally fully transferrable and follow you wherever you go.  Though you may have worked with a specific funeral home to make your prearrangements, that doesn’t mean that you or your family can’t select a different funeral provider at any time, prior to or after your passing.

It is common for people to switch funeral providers if they move to another area and don’t plan to return for a burial, and most funeral homes honor arrangements made elsewhere, though they may not offer the same guarantees against inflation.

Peace of Mind

Hopefully it is pretty clear that prearrangements are an important estate planning tool during life, and an even more valuable asset in death.  For those who feel as if it is too much work to make an appointment with a funeral home to discuss end-of-life arrangements, or to those averse to the concept of their own mortality, I urge you to consider the lasting impact that your decision to preplan could have on your loved ones.

Laying the foundation for a well thought out plan takes time and is not always easy.  But your time is better spent planning ahead today and enjoying tomorrow because of the peace-of-mind that preparedness brings.  It is said that “Nothing is certain except death and taxes.” Be better prepared for both by planning ahead today and enjoy the rest of your life – worry free.