What to Look For in a Pre-Paid Funeral Plan


Sharek Law Firm LLC

Posted on

Mar 17, 2023


Pennsylvania - Greater Pittsburgh Area

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Prepaying for your funeral is one way to ease the burden on your family following your death and make sure your wishes are carried out. But pre-paid funeral plans come with risks, so you need to exercise care when purchasing a plan. 

Funerals are expensive and can take a lot of effort to plan. To help relieve your family of some of this expense and effort, you can pay for your funeral in advance with a pre-paid funeral plan purchased through a funeral home. In addition to making things easier for your family during a difficult time, pre-paid funeral plans can also be a good way to spend down money in order to qualify for Medicaid.

However, consumers lose money every year when funeral homes go out of business before the need for the funeral arises. If the funeral home mismanages your funds, there may be no way to recover them. In addition, customers aren't always entitled to refunds if they change their minds, and some funeral homes sell policies that require additional payments or that can't be transferred if the customer moves. 

If you decide to go ahead with a pre-paid funeral plan, the following are things to consider:

  • Shop around. Prices among funeral homes can vary greatly, so it's a good idea to check with a few different ones before settling on the one you want. The Federal Trade Commission's Funeral Rule requires all funeral homes to supply customers with a general price list that details prices for all possible goods or services. The rule also stipulates what kinds of misrepresentations are prohibited and explains what items consumers cannot be required to purchase, among other things. 
  • Make sure you have a reputable funeral home. There have been cases of unscrupulous funeral providers taking advantage of customers, so make sure you choose a funeral home with a solid reputation. 
  • Read the contract carefully. Before signing, it's important to know what you're agreeing to. Can you cancel the plan and get a refund? Is the plan transferrable if you move to another area? Are you paying just for merchandise or for funeral services as well? If prices for funeral merchandise and services rise, will your estate be responsible for paying additional costs? 
  • Find out where your money goes. The pre-paid plan should provide information on what the funeral home will do with the money you pay them. Some states have protections in place to make sure the money is safeguarded, but other states offer no protections. Is the money put into a trust account? What happens to the interest income? Is there a plan if the funeral home goes out of business? What happens to any money left over?
  • Make sure the plan won't affect Medicaid benefits. If you're buying the policy as part of Medicaid Planning, you must purchase an irrevocable plan, which means you can't cancel or change it once it's bought. 

Once you've purchased a plan, be sure to tell your family about the plan you've made and let them know where the documents are filed. If your family isn't aware that you've obtained a plan, then the plan is useless.

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Sharek Law Firm LLC

Elder Law 105 Maple Dr, Warrendale, Pennsylvania, 15086

At Sharek Law Firm we dont just draft documents. We ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Life and Legacy Planning Session, during which you will get more financially organized than youve ever been before, and make all the best choices for the people you love.I cherish the opportunity to help secure what you love. I look forward to learning your story, hearing what matters to you, and helping you to discover what's actually needed to keep your loved ones out of court and out of conflict when something happens to you (or them). We specialize in creating wills and trusts to achieve your goals, whether you're located in Pittsburgh or outside of Western PA, we are here to help all Pennsylvania residents.Our law firm was built with your needs of in mind. We understand you are BUSY, and you value ease, convenience, and efficiency. You want to know youve made the best decisions to protect your family and assets, and that your plan will work when your loved ones need it most. We also help make sure your adult children are properly prepared to care for you and what you leave behind.Weve developed unique systems to give you the same access to legal planning as was previously only available to the super-wealthy, so you can have the guidance you need to build and maintain a life of prosperity and wealth. And, to keep your family out of court and out of conflict, which is the greatest risk to the people you love and all you have created, even if youve already worked with a traditional lawyer or created documents online. Contact us to get started today!