Wednesday, June 4, 2014

Knowing Abc's Of Funeral Prepayment Plans

By Lisa Buick


The strong emotions accompanying the death of a loved can make sound business decisions regarding final expenses more difficult. Family members may ultimately spend far more than was anticipated or necessary. Funeral prepayment plans are designed in principle to eliminate the need for making those hurried, last-minute decisions.

Buying a particular plan from a local, trusted service director can ease those concerns. The concept of having all final affairs in order is satisfying on both emotional and practical levels, but that appeal does not alter the reality that doing so is a major financial commitment for many people. Comparing individual plans is vital.

Choosing one of these plans is similar in most respects to buying insurance coverage against consistently rising funeral expenses. The payment for these future services can be made in one lump, or spread out over time. For some buyers, extended payments can actually end up costing more than the value of the original plan.

To avoid making such costly errors, read the details before formally signing an agreement. If a lump sum is paid, it usually enters a trust fund. Because rules dealing with this practice vary widely by state, there has historically been a potential for abuse. Examining and understanding local and state regulations eliminates unpleasant surprises.

Life is a series of changes, so make certain the policy allows them. Never assume that a cancelled plan will be refunded, or that a particular contract will necessarily cover all possible expenses, because there are finite limits. Thoroughly understanding a policy contract prior to signing is the best way to avoid disappointment.

With these caveats in mind, consumers who decide to make this type of investment enjoy greater freedom from unnecessary worry and concern regarding final wishes. Saving loved ones from the addition burden of making those difficult decisions is often well worth the cost.




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