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  • FIRST POST
    JPSC
    Pros and Cons of Pre-Paid Funeral Plans
    • #1
    • 1st Jul 09, 11:28 AM
    Pros and Cons of Pre-Paid Funeral Plans 1st Jul 09 at 11:28 AM
    I cannot see an earlier thread on this topic, but if I have missed one then apologies in advance.

    My parents, in their late 80s, are looking into these plans and I have no experience of the advantages and/or disadvantages of using them, so thought I would consult the collective wisdom of MSE, hoping to be able to tap into some actual experience.

    Obvious advantages seem to include fixing the cost at today's level and being able to negotiate exactly the arrangements you want for yourself. Against that, what happens if the Funeral Director involved goes out of business?

    I am sure there are many other points to be considered
Page 3
    • Kvnlyle
    • By Kvnlyle 24th Jan 12, 11:02 PM
    • 8 Posts
    • 4 Thanks
    Kvnlyle
    Don't forget Even Banks can fail , just look at whats currently going on in Europe especially. So Gulf of Oman would be a worry to me I think. Just be careful even Uk banks get into trouble
  • Peterthemole
    It makes no sense to me to pay for something like this up front. If the concern is about your nearest and dearest paying out what they can't afford then 'ringfence' the money. Undertakers never go out of business, they have an endless supply of customers, relatively few overheads and little requirement for a huge stock level.
    • PennyForThem
    • By PennyForThem 1st Feb 12, 6:15 PM
    • 575 Posts
    • 521 Thanks
    PennyForThem
    I learnt recently that as long as there is money in an account to cover a funeral then the bank will pay against an invoice from the funeral home. It is seen as an expense of the estate, so even if the account is 'frozen' until probity is granted, a funeral bill can be paid.

    I thought about a prepaid plan but I think I will set out my wishes in detail - it is the planning and uncertainty that is the problem, I think.
    • Old Git
    • By Old Git 2nd Feb 12, 7:14 AM
    • 4,243 Posts
    • 3,708 Thanks
    Old Git
    If you end your days in a nursing home ,you may have little money left .
    If the funeral is prepaid there will be a few thousand left ,you will still be dead .
    • Mojisola
    • By Mojisola 2nd Feb 12, 8:37 AM
    • 28,358 Posts
    • 72,181 Thanks
    Mojisola
    It makes no sense to me to pay for something like this up front. If the concern is about your nearest and dearest paying out what they can't afford then 'ringfence' the money. Undertakers never go out of business, they have an endless supply of customers, relatively few overheads and little requirement for a huge stock level.
    Originally posted by Peterthemole
    This isn't easy if you're on means tested benefits.

    This was the main reason that my parents chose to buy plans. They were allowed to have £6000 in savings before their benefits were affected.

    By buying the funeral plans, that money was set aside and they could then save so that, for example, when the OTs decided they needed a stairlift and were entitled to a grant but would have to wait 18 months for one, they were able to buy one themselves. If their funeral money had been part of their £6000 savings, they wouldn't have bought the stairlift because it would have left them short in the funeral fund.
  • Sweey as a nut
    I wrote about my experience on here a few years ago, it goes two friends of mine paid for a funeral for themselves and their wives 12 years ago cost £1.000 for each funeral. When they told me I had a good laugh. Nearly two years ago my wife died. Cost £3.300 a month after that I paid for mine cost £2.700 I don't want trimmings, in all cases cremation. They still rub it in when ever the chance presents itself. buying insurance is not the way to go especially these days.
    • nellykim
    • By nellykim 27th Nov 12, 6:18 PM
    • 149 Posts
    • 108 Thanks
    nellykim
    You may not pay in more but loss of interest has to be considered.

    If you pay £2,000 into a plan at 60 and died at 75 then you may have been better to have invested at 5% because it would be worth £4158 with compound interest. Or play safe and use index linked savings certificates.

    Indeed anyone considering burial can do their own advance planning and purchase a lair now. Local councils are bound to increase costs over the next few years.
    Originally posted by scotsbob

    ( my bold )...but you'd be dead, so would it matter... I am being serious here, not flippant.

    I have just read another ad in the Mature Times, dated November 2012 stating Funeral Costs could be arond £4194, by 2016, and am wondering if this could be a good thing ( to buy a Funeral Plan NOW ? )
    Last edited by nellykim; 27-11-2012 at 6:20 PM.
  • pjb2u
    this forum is quiet...
    Last edited by pjb2u; 03-07-2014 at 3:38 PM.
  • alcoplop
    funeral plan a good idea?
    My inlaws had arranged a plan for themselves with a well known company, until they died I didnt realise what a bonus this was. The company took care of every thing and were extemely supportive, I have looked over the past few years at setting one up for myself and my huisband, and have been surprised at how much the cost has increased. this year we intend to purchase one each if only to support our children when they have to arrange ours.
  • baz1234
    My inlaws had arranged a plan for themselves with a well known company, until they died I didnt realise what a bonus this was. The company took care of every thing and were extemely supportive, I have looked over the past few years at setting one up for myself and my huisband, and have been surprised at how much the cost has increased. this year we intend to purchase one each if only to support our children when they have to arrange ours.
    Originally posted by alcoplop
    if you know which directors your family works with your choice is easy, the financial benefits are obvious only if it is affordable for you now
    • Biggles
    • By Biggles 3rd Feb 15, 10:17 AM
    • 7,438 Posts
    • 4,810 Thanks
    Biggles
    this forum is quiet...
    Originally posted by pjb2u
    Funereal, you might even say.
    • GothicStirling
    • By GothicStirling 23rd Oct 15, 6:26 PM
    • 953 Posts
    • 703 Thanks
    GothicStirling
    My Dad died recently, and if it wasn't for his aunt I don't know how I would have paid for the funeral.


    I would also point out to those who say save in a bank account, no funeral director will start the funeral process (i.e collecting the body from a morgue) until they have received the payment for disbursements (the legal stuff) which is £1300. It took almost 6 weeks for Dad's bank to release money to the funeral home. Luckily, he had a Sun Life plan with enough money to get the ball rolling.
    • Lost2
    • By Lost2 24th Oct 15, 12:15 AM
    • 14,030 Posts
    • 27,990 Thanks
    Lost2
    I have an ISA that I pay into every month
    I do not want a fancey funneral just put me
    in a body bag in the back of a van and off to the crematurium
    why spend a whole load of money
    Sealed Pot Number 262009..£950.50 2010..£256 2011..£526 2012..£548.80 2013..£758.882014..£510 2015...£604.782016...£704.50 2017...

    SwagBucks £710
    • Mojisola
    • By Mojisola 24th Oct 15, 10:14 AM
    • 28,358 Posts
    • 72,181 Thanks
    Mojisola
    I do not want a fancey funneral just put me in a body bag in the back of a van and off to the crematurium

    why spend a whole load of money
    Originally posted by Lost2
    You don't have to spend a load of money but a dignified disposal of a body is something that humans have been doing since we have been humans. It doesn't benefit the one who has died but can make a lot of difference to how those left behind cope with the death.

    Also, the crematorium has to comply with rules about body disposal - you can't just turn up with a body in a bag.
    • Farway
    • By Farway 24th Oct 15, 1:52 PM
    • 5,585 Posts
    • 7,061 Thanks
    Farway

    Also, the crematorium has to comply with rules about body disposal - you can't just turn up with a body in a bag.
    Originally posted by Mojisola
    True, my son in law is a GP, and is paid what commonly known among the medicals as "ash cash"

    Reason being unlike a burial you cannot retrieve the body should foul play be later alleged
    • shazbig
    • By shazbig 4th Nov 15, 12:37 AM
    • 83 Posts
    • 115 Thanks
    shazbig
    Feel empowered
    I lost me Dad less than 2 years ago, and my MIL 2 months ago. Both had pre arranged funerals with a bond from the Co-op.
    When you lose a loved one, it is such a relief to know that their wishes had already been expressed and that you are in safe hands of experienced funeral directors who can carry out their last wishes.
    So today my husband and I also purchased bonds with the Co-op. We chose everything we would like, including the type of coffin, notices in the paper, and all the disbersments, ie the cremation fee, the Dr's fees etc. The only thing we didn't purchase was flowers, as we felt we needed to give our family some choice as to whether they wish to donate to charity or have flowers (we have specified the charity though!)
    I feel quite empowered by the experience, I have made my own choices for my final journey, taken responsibility away from my loved ones and have peace if mind knowing I have 'put my affairs in order'
    As an added bonus, particularly as this is a money saving forum, my husband work in the retail section of the Co-op and we got staff discount 10% for first booking and 25% for the second!
    • Chris2001
    • By Chris2001 15th Aug 17, 8:30 PM
    • 1 Posts
    • 1 Thanks
    Chris2001
    Fixed Cost is always a good idea but there are pro and cons
    Just some inside knowledge.....We have a consultancy Company that focus on amongst other things is putting Trusts in place for Funeral Directors so they can deal in their own prepaid funeral Plans, but there are not many about with there own Trusts at the present time that is why generally you would purchase this through a third party Company, who would have their own trust and also have a contract in place with funeral directors on a national basis to ensure that they will carry out that funeral for Todays cost plus CPI/RPI moving forward.

    This activity is a restricted activity under the FCA unless a Trust is set up in a certain way with independent Trustees, regular audits and an actuarial valuation every 3 years to make sure that the trust is keeping in line with CPI/RPI, so technically your money is safe and if the Company went bust your money would be safe to carry out the funeral or refunded less an administration fee this would be up to you plus the Trustees.

    Funeral plans are good value, as you can see from earlier posts.

    Our company is encouraging more and more funeral directors to have their own Trusts as ultimately they would sell you a funeral at a cost and have an obligation to carry out the funeral without any extra or additional fees as it would be them carrying out the funeral and not a possible breakdown in communication between a provider and funeral director.

    When dealing with a provider Always ensure they give gives you a certificate confirming the Funeral Director as this can be checked and carefully look over the terms and conditions, there is generally a cooling of period of 28 days and a cancellation fee of £395 average if you change your mind after this time. Some funeral plans do cover internment ( which is the coffin being placed in the ground as this generally would be the same price as cremation) but will not cover your plot, flowers, wake etc but I think most sensible people realize this.

    In 2001 the cost of an average funeral was around £1200, Today its £3800 so the longer you live the more value it becomes.

    A few rules
    1/ do your research
    2/ ensure that a funeral director is nominated
    3/ check the T and Cs
    4/ Always ensure your next of kin know about the plan and who its with
    Last edited by Chris2001; 15-08-2017 at 8:44 PM.
    • louloubelle79
    • By louloubelle79 17th Aug 17, 3:32 PM
    • 205 Posts
    • 93 Thanks
    louloubelle79
    Hi can anyone advise regarding funeral plans are the way to go or not? Thank you
    Hoping to be mortgage free by 2026 age 47
    Current rate 2.79% fixed for 10 years
    Current mortgage end date: 03/10/2043
    MFW Starting Mortgage Jan 17 - £114,703
    • luvchocolate
    • By luvchocolate 17th Aug 17, 5:25 PM
    • 1,466 Posts
    • 1,323 Thanks
    luvchocolate
    Hi ..if you read all the posts on this thread, that will be a starting point for you.
    • Magic Sister
    • By Magic Sister 8th Oct 17, 6:54 PM
    • 26 Posts
    • 32 Thanks
    Magic Sister
    There are so many reasons not to pour money down the drain for something like this.

    There is no 'hassle' or worry for relatives, the bank will free up your funds in advance of probate in order to pay for the funeral. And as regards producing death cert, will etc, they're going to have to do that anyway.

    If you think your estate will leave no money when you have died (ie no cash and you don't own a house), then why on earth stretch yourself to pay for a funeral now? If your executor doesn't have enough funds to pay for your funeral, he can get a funeral payment from the state.

    And it certainly won't save money overall. The only reason people operate these schemes is - guess what? - to make money!

    You are much better off enjoying your money, and investing it if it's spare, than worrying about what's going to happen after you're gone.
    Originally posted by Biggles
    Actually there is no funeral payment from the state unless the executor is in receipt of means tested benefit. When my Mother died, albeit 20 years ago, she had no money and no funeral plan (she said she had). I was a single Mum with 4 kids and had no money. It was taken over by the Coroner, and was the most degrading inhumane experience of my life. I was allowed nothing of hers (you know, like the button tin from my childhood and her photo albums), as everything was sold (or dumped) to offset costs. I had no input into the arrangements, and was not even allowed to add any details to her death certificate. I will NEVER let my children be in this position and will ensure that I have payment covered.
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