Blog Archives for tag funeral planning
But I Have Whole Life Insurance To Pay For My Funeral…
Why is this NOT a good idea? I recently helped a gentleman who had, in good faith, taken out a whole life insurance policy to pay for his final expenses. So far, he has paid in over $18,000 (yes that is correct!). If he retained the policy, he would be required to pay the rest of his life. At age 81, that could be ten or more years. At $101 per month, or $1,212 per year, several thousand more dollars in premiums could be paid. And, did I mention that since he has paid since 1999, the cash value of the his insurance policy is a whopping $2,100? Additionally, when he dies, the death benefit pay-out is $5,000.
This is a sentiment expressed by many of my clients. They don’t want a fancy casket. They don’t want alot of money spent on their final arrangements. They want something very simple. They are from the “no frills” generation, who want to be respectful while being frugal.
If you have not pre-planned your funeral and made arrangements prior to death, it puts your loved ones in a bind. It can be a time bind. It can be a financial bind. If you have expressed to your loved ones that you want a simple final service, it is even more important for you to pre-plan than if you want to spend alot of money on your final arrangements.
Dying Is So Expensive!
So true. Today’s very average funeral in the Midwest region is about $7,000 to $10,000, not including burial space and a marker. So how can we decrease the expenses?
It’s Only “Stuff!”
I’m not worried about my personal “stuff.” I don’t really have that much, plus my kids get along fine anyway….do you know anyone who has said this? Do you know any family members who have ended up arguing, or not speaking to each other after dividing “stuff?”
Studies show that personal property after the death of a loved one is an issue that impacts individuals regardless of their financial worth, heritage or cultural background. Emotions and family relationships impact decision making. Inheritance decisions can enhance or destroy family continuity.
I Don’t Know What To Do……
I recently helped a sweet lady who didn’t even know who to call, in terms of a funeral home, when her husband died. It makes my heart sad for those who have lost someone they love, and to make matters worse, have no idea what steps to take. Even though she had made funeral arrangements for family members in the past, at 80 + year of age, she didn’t know what to do. It wasn’t a matter of confusion or dementia, it wasn’t a matter of having no one to help her, she just plain didn’t know what to do. Her husband was in his 80’s and suffered from Alzheimer’s disease. Yet she, nor family members, nor anyone around her suggested at any point that pre-arrangements be made.
That is the question…..I saw it again this week. A sweet lady mistakenly thought that the only way she could pre-fund her funeral is to make small monthly payments, over a several year period, and pay interest for the “privilege” of setting aside her own money! WRONG! By using a Funeral Trust, you can make small monthly payments, over the number of years you choose, and RECEIVE interest, much like a savings account. You do NOT have to pay interest to a third party for the “privilege” of saving your OWN money for your OWN final arrangements!
How many kids do you have? Do the kids ever disagree? Is one a dominant personality? Are they equal in financial assets? Do they have spouses that get along well with your family?
These are some of the questions to answer when pre-planning your final arrangements. By making your pre-plans, one important gift you are giving your kids is family harmony. My dad used to say we shouldn’t “borrow trouble.” However, when no pre-plans are in place – that is exactly what we are doing – borrowing trouble, especially if our children are not “equal” financially and personality-wise.
“Bless your little pointed head….” my high school Algebra teacher, Mrs. Benedict, said this to me often. I always struggled with math and didn’t like numbers much. But when I began to help clients with their final arrangements – I could easily do the math.