Prepaid Funeral Plans

Simonne15

There's a lot of good advice in the MSE article. I am commenting here because have recently learned from a trustworthy lawyer I know that you can put money aside in a Prepaid Estate Plan which isn't tied to any funeral company. It is lodged with the lawyer, is outside of your estate for inheritance purposes and what interested me particularly is that it is then accessible by your inheritors or executors at time of death for out of pocket expenses etc. depending upon what you specify.
I am concerned that I don't want anyone to struggle and become in debt for anything that is incurred by my death that has to be paid immediately and before the estate would be sorted out. 

Mojisola

Simonne15 said:

I am commenting here because have recently learned from a trustworthy lawyer I know that you can put money aside in a Prepaid Estate Plan which isn't tied to any funeral company. It is lodged with the lawyer, is outside of your estate for inheritance purposes and what interested me particularly is that it is then accessible by your inheritors or executors at time of death for out of pocket expenses etc. depending upon what you specify.

I've googled the bit in bold and haven't found anything - are you sure your solicitor is trustworthy?

As for paying for the funeral, that's not a problem - the funeral director sends the bill to the bank and it will be paid from the deceased's account.

One drawback is that you don't get the benefit of freezing the price of the funeral at today's prices - my parents' funerals with AgeUK were much cheaper because they had bought funeral plans some years before they died.

poppystar

It doesn’t always work out cheaper. My father had a prepaid funeral and it was more costly than the ‘bundle’ they were offering when he died was. I guess maybe they build in possible future rises. The funeral directors did use some of that money to pay for orders of service that weren’t part of the original funeral he purchased, so I was relatively happy with how they handled it.

All funerals are effectively outside the estate as they are an allowable expense for calculating IHT. 

Gers

Simonne15 said:

There's a lot of good advice in the MSE article. I am commenting here because have recently learned from a trustworthy lawyer I know that you can put money aside in a Prepaid Estate Plan which isn't tied to any funeral company. It is lodged with the lawyer, is outside of your estate for inheritance purposes and what interested me particularly is that it is then accessible by your inheritors or executors at time of death for out of pocket expenses etc. depending upon what you specify.
I am concerned that I don't want anyone to struggle and become in debt for anything that is incurred by my death that has to be paid immediately and before the estate would be sorted out. 

Seems to be 'pre-paid probate plans' - something to be very wary of, even the FCA warn against them.

https://www.fca.org.uk/news/news-stories/consumer-warning-pre-paid-probate-plans

https://wards.uk.com/news/pre-paid-probate-plans-the-very-real-dangers-explained/