Layin' It on the Line: How to take the stress out of planning your funeral

"Insurance companies and funeral homes often tout prepaid plans. However, there may be more efficient, safer ways to plan ahead." — Lyle Boss

When you lose a loved one, the last thing you want to think about is money. A prepaid funeral allows you to lock in today's prices for funeral services and take away any financial burden from your loved ones.

Prepaying your funeral

On the surface, prepaying for one's funeral may seem like a great idea. If you're like me, you are bombarded constantly with messages telling you to plan now so life events won't blindside you. And, whether we like talking about it or not, death is the most significant life event that all of us will face.

That's why, on the surface, a prepaid funeral seems like a great idea, but prepaying may not be the best option for everyone. Here are some reasons you may choose the prepaid route:

* You may want or need to make things easier on your loved ones and reduce their stress load when you pass.

* You want to help ensure that your survivors are not responsible for your final expenses.

* You anticipate price increases for funerals and want a guaranteed price.

While these are all valid reasons for prepayment, there are also potential downsides that you must consider. These may include:

* The funeral home with whom you contract may change ownership or go out of business entirely.

* Only a handful of states have consumer protection laws in place to prevent prepaid funeral fraud.

* If you must cancel your plan, or you move, it's possible you may not get a full refund.

* Unless you make it a point to explain your arrangement with loved ones, they may not be aware that your funeral costs have been paid and use a different funeral home.

'Prearrangement' might be a better plan

Preplanning or prearranging may be a better option than prepayment. If you shop around, getting detailed price lists from several funeral homes and comparing prices, you're likely to discover substantial price differences for the same services. Research the most affordable funeral homes, visit them and choose the one you like the most. Some homes will even allow you to fill out a prearrangement form and keep it on file.

Be sure to let your family know about your decisions and leave them a checklist outlining every detail, along with relevant receipts and copies of the contracts and prearrangement forms.

Give these to responsible parties now and make sure your directions are clearly understood. Discussing death is a complex but necessary conversation that will bring you and your loved ones more peace of mind.

You could set up a Payable on Death account

Another possible option is to set money aside for your end-of-life expenses without giving control of those funds to a funeral home. Simply name a beneficiary and provide a form called Payment on Death so your beneficiary can have access to the funds. Many banks will allow you to establish "payable on death" (POD) accounts to cover the current costs of a funeral. Ask your local bank for more information.

Conclusion

No one wants to discuss funerals and end-of-life topics, but a little planning might relieve a lot of stress at that future date.

Lyle Boss is a member of Syndicated Columnists, a national organization committed to a fully transparent approach to money management. Boss Financial, 955 Chambers St., Suite 250, Ogden, UT 84403. Telephone: 801-475-9400.