Prepaid Funeral Plans

Mojisola

Primrose wrote: »

It,s all very well people advising us to out the money aside in a separate account rather than paying for a funeral plan but I have no children so if a friend is my executor and has to organise my funeral why should that person have to pay for my funeral expenses out of their own pocket when funeral directors expect funerals to be paid for immediately?

Putting money aside might mean that an executor can't access it until probate had been granted and that could take months. Surely one of the reasons for paying up front is to avoid this kind of hassle and pressure on the people who have to organise and pay for your funeral?

If the funeral director sends the bill to the bank or the executor takes it there, it will be paid immediately from the deceased's account directly to the FD.

geminilady

Putting money in an account does not guarantee your funeral will be paid for, prices are rising all the time and you might not save enough,The good thing about a funeral plan is even if you die 20 years from now you will only pay todays prices plus you can add your wishes for songs played type of funeral ect.

Yorkshireman99

geminilady wrote: »

Putting money in an account does not guarantee your funeral will be paid for, prices are rising all the time and you might not save enough,The good thing about a funeral plan is even if you die 20 years from now you will only pay todays prices plus you can add your wishes for songs played type of funeral ect.

Buying plan does not always guarantee that it will cover extra costs over time.Many do not.

geminilady

Yorkshireman99 wrote: »

Buying plan does not always guarantee that it will cover extra costs over time.Many do not.

Many do and if people read the paperwork they will know exactly what is covered

Yorkshireman99

geminilady wrote: »

Many do and if people read the paperwork they will know exactly what is covered

And that is the problem! Often the paperwork includes lots of fine print and many don't read it. There are lots of get out clauses in many cases. Twenty year ago when interest rates were much higher than in recent years the companies could earn a good rate of interest and cover the rising costs. Now they cannot do that. Hence they are, in many cases a bad buy.

stevepett

There are good plans, bad plans and downright awful plans. Some should be banned by the FCA. Independent advice is essential, but rare as hens teeth.

Very few banks will pay out money if the deceased didn't have £3 to £5000 available. Very few people keep that much ready cash. But the will pay from an ISA etc when you get a grant of probate.

Yorkshireman99

stevepett wrote: »

There are good plans, bad plans and downright awful plans. Some should be banned by the FCA. Independent advice is essential, but rare as hens teeth.

Very few banks will pay out money if the deceased didn't have £3 to £5000 available. Very few people keep that much ready cash. But the will pay from an ISA etc when you get a grant of probate.

Simply not the case it seems. Banks don't need probate to pay an undertaker from an ISA. ISA's lose their special status from the DOD.

Malthusian

stevepett wrote: »

Some should be banned by the FCA. Independent advice is essential, but rare as hens teeth.

The FCA doesn't regulate funeral plans. Which is another reason not to buy one. Not that you are especially at risk of being scammed via a funeral plan, more than it illustrates that they are no good as an investment. They are in the same category as Christmas saving clubs (also not regulated by the FCA, which is why the victims of the Farepak collapse lost most of their money).

Generalisation alert: anyone who retains an Independent Financial Adviser is very unlikely to take out a funeral savings plan. They will have enough savings and investments that the risk of not having enough money when they die to pay for a funeral will be virtually nil. And their savings will be invested which will help counteract the rising cost of funerals.

LiaE

If a company was to go into liquidation if you paid your prepaid funeral plan in full via credit card would you not be protected by that so you don't lose your money?

Yorkshireman99

LiaE wrote: »

If a company was to go into liquidation if you paid your prepaid funeral plan in full via credit card would you not be protected by that so you don't lose your money?

Probably. Such plans should be backed by insurance and the funds held in escrow so they don't get swallowed up in such a case. Even so they are a bad deal.