Should I Prepay for My Funeral?
By: Sandra Block (AARP)
S E E D E D C O N T E N T
After my father died, the first call I made was to my brother to discuss who we needed to contact to share the sad news. The second call was to a funeral home.
My father knew what he wanted for his final send-off, and he didn’t want his children to pay for it. So, years before he died, he prepaid his funeral costs .
In our case, this worked out well. The funeral home’s owners were longtime family friends who had handled my aunt’s arrangements a few years earlier. The director even knew my grandfather. At a sad and stressful time , they handled numerous details, from contacting Social Security to publishing my father’s obituary.
Planning your own funeral, and making sure your family members know how you want to be honored, is one of the best gifts you can give your loved ones. And if you reach out to funeral providers to discuss services and costs, there’s a good chance they’ll offer prepayment packages.
Prepaying for your funeral enables you to lock in prices for some services and relieves your family of the need to finance the arrangements. That’s no small thing, considering the median cost of a funeral that includes a viewing and burial is $8,300, according to a 2025 survey by the National Funeral Directors Association, and fees could rise significantly over time. Prepaying funeral expenses can also minimize disagreements among family members who may have different opinions about what services your funeral should entail.
Another option is to purchase an insurance policy from an insurer that partners with a funeral home. With this type of policy, known as “preneed funeral insurance,” the funeral home is the beneficiary and will use the death benefit to cover your funeral expenses.
You can also purchase burial insurance, also known as “final expense insurance,” directly from an insurance provider; in that case, proceeds will go to your beneficiaries. The cost of premiums varies depending on the amount of your death benefit, your age and other factors, but they average $50 to $100 per month.
However, there may be more effective and less costly ways to cover your funeral expenses. The Funeral Consumers Alliance, a nonprofit consumer organization that monitors the funeral industry, generally advises against prepaying for a funeral. Among the drawbacks, according to the alliance: Your prepayment may not cover all of the costs; the funeral home could go out of business before you die; or your family may have a difficult time getting a refund if you die out of town and they need to use another funeral home. In the case of insurance policies, the insurer might not pay the full benefit, or any benefit, during the policy’s first few years.
State regulation of funeral prepayment plans varies, according to the Federal Trade Commission. Some states require funeral homes to put prepayment funds in a state-regulated trust; others offer little or no protection for consumers who purchase these plans.
Other funeral payment options
That doesn’t mean you should require family members to pay for your funeral arrangements. Even if you’re confident there will be enough in your estate to pay for the expenses, your executor likely won’t have access to that money until your estate has been settled, which could take months. In the interim, your family will have to cover the costs.
To avoid this problem, consider depositing funds to cover funeral expenses in a payable-on-death (POD) account with a reputable bank or credit union .
Designate as beneficiary a trusted family member or friend whom you’re confident will use the money for your funeral. POD accounts offer several benefits: The money is federally insured for up to $250,000; any interest accumulated will go to you, not the funeral home; and the funds are available immediately when you die. Critically, you’ll maintain control of the account while you’re alive, enabling you to use the money for other purposes if necessary, such as to pay for an emergency medical expense that you can’t cover out of pocket.
Shop around
However you decide to cover funeral expenses, comparing costs from several funeral providers allows you to review prices and services to find the best fit for your needs and relieves your family members of the stress of making arrangements while they’re dealing with grief. If you want to be buried, for example, it’s usually a good idea to purchase a cemetery plot ahead of time, the FTC says; otherwise, family members may feel rushed to buy one after you die.
Opting for direct cremation instead of a full-service funeral can help save money. Federal law requires funeral homes to include the cost of cremation in their price list. You can use any funeral home, even one that’s far from where you live, and have the remains shipped to you.
Donating your body to a medical school is another option that could save you thousands of dollars and benefit future health care providers. Medical schools typically cover most, if not all, of the costs, and usually return any cremated remains in a couple of years.
My very practical mother, who predeceased my father by several years, chose to donate her body to a university medical school in our state. After she died, we rented a local funeral home’s parlor for an afternoon so people could pay their condolences, then held a party for family and friends in our backyard. I’m confident that’s how she wanted to be remembered.
Sandra Block has covered personal finance for more than two decades. She was a senior editor at Kiplinger Personal Finance and a reporter for USA TODAY . She is the coauthor of The Busy Family's Guide to Money and Easy Ways to Lower Your Taxes: Simple Strategies Every Taxpayer Should Know .
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My parents made their funeral arrangements in advance which really simplified things. I've gotten to the age where I need to follow their example.
My mother did, made it easy. Everything was taken care of, all we, (the family), had to do was show up.
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Ever since I have been creeping up in years, insurance companies I am associated with have been 'peppering' me with junk mailers about (life/death) insurance. So much so that I am 'bout to tell them all off verbally.
What a 'timely' article. And I agree wit the sentiments expressed in it. Also, I have a pre-planned burial plot. . . now am working out the 'kinks' (steps) in the get to the ground process' associated cost. . . and a casket. (I liked the "Payable on Death" concept, as it appears (to me anyway) to be a set aside account.) After reading this article, I am thinking positively about a separate savings account just for this purpose. It will go a long way into easing my mind about my final demise.
Nerm, good looking out!
Another alternative method I recently learned about: "Human Composting: A New Take on the ‘Green’ Funeral This growing trend uses an organic process to transform the body into nutrient-rich soil"
After I had a heart attack I started getting unsolicited letters from cremation companies.
Cremation. . . yeah, I hear about them more and more and truth be told more and more of my family members are turning to it for their final services (resulting in more and more memorial services occurring (not full-blown funerals). In my case, I don't feel I need a funeral service (I will be permanently unconscious-I guess). . .and yet, I can not 'store' myself or throw dirt over my "committed' form. Somebody else will have to do this for me. . . when my time comes. . . so, I am wanting to set aside some 'enticement' funds to get 'er done and give that family member a 'bump' in finances as a benefit.
Oh, about cremation. . . I have a personal and private concern about 'fire-pits' - so I just want to be buried. Having secured a plot (prepaid), I am now essentially in need of turning to prepaying for those services ahead of said 'placement.'
Number 3 (above) is interesting, nevertheless.
Insurance companies appear 'desperate' to have me commit. That is 'annoying,' and I am having a bit of trouble making such commitment (in a timely fashion). Honestly, I just don't know how to deal with them. (Mainly, because I have figured out their 'hustle' and I am not sure I can agree with what I found.)
I've already socked away for a simple no frills cremation at 1,000$, the government death benifit of 2,500$ should be ample to buy scads of oysters and a case of decent vodka. If there is a must-to-do, it is getting rid of stuff I've horded over the years. Also, I am not adverse to finally becoming useful as a crash test smart-dummy and my newly tenderized parts donated to Hannibal Lecter.
My understanding is cremation is about 3,000 nowadays. . . Inflation?
My wife's was close to 8k... But that's EVERYTHING included.
Can you elaborate on what is "everything included," please? Though I am a ground burial kind of guy. . . I still would like to understand the cremation "way" better!
That would include transportation to and fro crematorium, plus death certificates, ashes urn and last rights services.
WoW! Markups! These people and their 'services'! Alas, it's a business (afterall).
Arvo..geez that's cheap..$10,000 here for a cremation and casket as of March..plus had to have a round trip of 500kms..that's the closest crematorium...
Burial here would be kicking around $15,000 that includes plot, casket, church service, death notice and flowers..
Expensive to come into the world and expensive to go out of it..😊
Although her plot and headstone were already paid for when my Father passed in 2010, Mom's funeral including burial vault and an average priced steel casket ran about $16,500 last year...
Transportation, storage, etc..
correct.
We paid 9K for my mother a couple of years ago... not including her plot and marker which were already paid. Thankfully she had a life insurance policy that covered it.
There is a notable shift toward cremation. In tight financial times more and more people are not interested in 15 or 20 thousand dollar funerals.
I think: Yes. Go for it. It's peace of mind. (Mr. Frost above makes a great point!)
I had at least one family member that took the 'donation to science' route. . . I don't know about that one. . . it sounds so. . . 'touchy' (literally). Ugh!
At 92 my father wanted to prepay for his and my mothers cremation. He didn't want any service and he didn't want any burial. It was the funeral home that told us (I helped him) he and my mother (body or ashes) could be buried in a state military cemetery (including headstone) for free. It was too good for the depression baby to pass up. My mom passed 2 weeks later and he died 5 years later. With one phone call the funeral home took care of everything. We didn't have a church service but the funeral home did have prayers at the gravesite (along with the family priest) for the family.
Point is it can't hurt to look at all the options with a funeral home and then make a decision.