Pre-Need Funeral Insurance Plan Explained

It may not be fun to think about, but it’s important to start planning for your funeral now to save your family stress and heartache during a difficult period. Funerals can get expensive quickly, and many families end up without the financial resources they need to cover the costs. There are many insurance options available to help you cover the cost of funeral expenses. Here we’ll be talking about pre-need funeral insurance and how it compares to other options, like life insurance.

What is a pre-need funeral insurance plan?

Pre-need funeral plans are offered by funeral homes instead of insurance companies. You will work directly with the specific funeral home you want to plan your funeral arrangements. They will calculate the exact cost for you, which you will then pay off before your death. You can opt to pay the funeral costs in one payment or in installments over time, depending on what makes the most sense for you.

What are the benefits of a pre-need plan?

There are a few key benefits to taking out a pre-need funeral plan. The biggest benefit is that it relieves your family of the burden of paying for your funeral. The period after a death is very stressful for everyone involved, so having the funeral expenses already taken care of can make a big difference for your family. The other benefit is that you get to plan your funeral ahead of time. This can give you some peace of mind, knowing that your funeral will suit your personal preferences.

Another one of the benefits is that you don’t need to worry about the cost of the funeral expenses rising.  If you buy final expense life insurance, you may not buy a big enough policy to cover the complete costs of the policy.  The rise in funeral expenses has outpaced the increase in other costs by a substantial margin.  If you prebuy your funeral, you don’t need to worry about rising costs like you do with a life insurance policy as long as your plan guarantees services.

What are the downsides of a pre-need plan?

There are some downsides to getting a pre-need plan that are important to consider as well. The first is that a pre-need plan only covers your funeral expenses – it doesn’t cover any of the other expenses that come with death, such as paying off debts. You may need to take out a life insurance policy in addition to a pre-need funeral plan. If this is something you are considering, it’s important to compare several different options to see which makes the most sense financially. You can get a life insurance quote here. In many cases, it may be more affordable in the long run to take out a traditional life insurance policy that will cover all the expenses. It’s also important to note that pre-need plans can be expensive, and you may end up actually needing that money for other expenses during your lifetime. Paying monthly premiums on a traditional life insurance plan is often more affordable and gives your family access to more money upon your death.

Another thing that’s important to consider is that the costs of a funeral can change over time. In some cases, your family still may end up having to pay some additional funeral expenses if the cost of your arrangements goes up. This is a particularly important consideration if you are still relatively young, as prices for everything are likely to change in the next 30 to 40 years. To prevent this, make sure that your pre-need funeral plan contains guaranteed services. This stipulation ensures that your family won’t end up needing to pay more for your services upon your death.

What should I consider when purchasing a pre-need funeral plan?

It’s very important to shop around when looking for a pre-need funeral plan. Funeral expenses can vary depending on which funeral home you go to, so you should investigate prices at all of the funeral homes in your area to see which offers the best deal. You should also keep in mind that the services you choose can affect the cost of the funeral. If you are looking to save money, it’s worth considering which features are absolutely essential and which are just for aesthetics.

Going beyond the financial concerns, it’s also important to research the funeral home itself before taking out your funeral insurance plan. Make sure that the funeral home is a reputable one with a trusted history. You should also choose a funeral home that’s convenient for your loved ones, as they are the ones that will be handling the funeral when it actually happens.

It’s also important to note that pre-need funeral plans may not be for everyone. They are best for people who have already paid off all of their debts, such as mortgages and student loans, and aren’t worried about providing financial support to their loved ones after their passing. They are also a good option for those who are more concerned about convenience than price. If you need extra financial coverage for your death beyond what a pre-need funeral insurance plan can offer, consider taking out a traditional life insurance policy instead.

Since funerals are so expensive, it’s important to start planning now. A pre-need funeral plan is convenient for your family and provides you control over your funeral. They are worth considering if your biggest financial concern is paying for your funeral expenses.