Funeral planning or cremation planning is often overlooked when planning your estate and handling your life and death affairs. Most people believe that pre-funding their funeral or cremation needs is a good idea but they are unaware of the alternatives. Setting aside funds in advance to cover funeral or cremation costs is one of the most thoughtful, conscientious gifts you can give to your family.
While pre-arranging monies by purchasing a plan at a specific funeral home or cremation service is possible, another excellent option to pre-fund is creating a Funeral Trust. A Funeral Trust is a specialized type of trust that is meant to hold an insurance policy. It serves a purpose altogether different than that of a normal revocable living trust.
The Funeral Trust
A Funeral Trust is designed to hold an insurance policy that will pay for your funeral or cremation costs upon your death. You pre-pay the entire insurance premium all at once with the amount you want to set aside to help pre-fund your funeral or cremation costs. There is no underwriting. Everyone qualifies under 99 years of age qualifies. Once the insurance policy is issued, it bears interest income tax-free for the rest of your life. Upon your death, the insurance policy proceeds are paid out through the Funeral Trust to the funeral home, cremation service, or other service provider at the choosing of your executor. Any excess funds remaining in the Funeral Trust are paid to the beneficiary of your choice.
Steps to Take to Set Up a Funeral Trust
We offer a free, no obligation consultation for Funeral Trust planning for any individual who might feel inclined to assess whether this type of planning is right for them. The sign-up process is very simple for those who decide to proceed with this type of planning. One of our attorneys can meet with you to discuss the details and steps that are needed. Please contact our office if you’d like a consultation to learn more about Funeral Trust planning.