Funeral Preparations & Financial Records
Most people take care to keep their legal and financial records safe. But be sure not to keep them safe from those who might need access to them. Once you have decided who will take responsibility for your health and for your estate, be sure they have access to the related documents. To speed things up, in addition to assigning power of attorney and executor, you can set up trusted family members as signatories on accounts so they have access as soon as needed.
Pre-Planning Funeral Services
Pre-planning offers peace of mind knowing that your wishes will be respected and that your family has fewer burdens during a time of grief. Funeral preplanning is the process you and your family go through to make decisions about how you want your funeral or cremation performed and details such as what casket, urn, flowers, and so on, you want at your funeral. Your wishes can be documented so your loved ones may avoid making difficult decisions during an emotional and stressful time. You can make these arrangements with a funeral professional.
Ways to lower the costs, include, (1) purchase the casket from the manufacturer. A few options are: fastcaskets.com, directcaskets.com, bestpricecaskets.com and (2) purchase the marker directly from the manufacturer possible options are: legacyheadstones.com, cemeterymonumentonline.com (or check local listings) In most places cemeteries are required to accept third-party caskets and markers but some cemeteries have policies on the look of headstones.
Pre- Need Insurance and Funding
In addition to planning the funeral itself, there are a number of ways to cover the related expenses in advance, also relieving family from this responsibility. There are several benefits to funding your funeral arrangements in advance.
- Services may be carried out at little or no additional cost to your family.
- Funds may be immediately available with no waiting period due to probate or other delays.
- Allows you to consider cost-effective options at a time when you are better prepared to make sound, fiscally responsible decisions. There may be flexible payment options.
- In some states, prearranged funeral contracts may not be counted as assets for Medicaid spend-down purposes.
- The death benefit of a preneed life insurance policy grows over time to help offset inflation and that growth may not be taxable to you.
- A preneed life insurance policy can be portable (please be sure to ask); therefore, if you move to another area, the insurance may be used to fund a funeral contract with the funeral firm of your choice. Note: this is different than paying a funeral home in advance.
- Not all pre-need insurance covers the burial as well as the funeral home costs. Be sure to check. Additional expenses need to be considered as well. Reception space and refreshments. Honorarium for an officiator, a donation to the local church, flowers, and decor (biographical displays, etc.).
- Look into “Final Expense Insurance” for a broader range of items covered.
- Note: If you pre-pay funeral expenses through a funeral home you can often lock in a price at the current rates which could mean substantial savings over time. This is a good option if you plan to remain in the same location. Some funeral homes are part of a chain allowing you to use the same policy at other locations. However, this is often not “portable” meaning that if you move to another location and use another funeral provider, you might not be able to use this payment.
- Please discuss with an insurance or funeral professional to be clear what is covered and what is not.
Pre-Purchase Plot at UC Wonjeon or Local Cemetery
A number of cities have established a local Wonjeon, including: Washington, DC, Tarrytown, NY, Phoenix, AZ, and Las Vegas, NV. There are great comfort and merit knowing that our physical bodies are buried alongside precious brothers and sisters, but in addition, there is usually a discounted cost because the burial plots are purchased as a group rate. Burial plots refer to the burial liner, which is a cement container that encloses the coffin to help prevent a grave from sinking. These are offered either as a single or double, that is, one person or a couple. By pre-purchasing the plot, you can have the peace of mind that a place is “reserved” in a church Wonjeon or local cemetery.
BFM Seonghwa Information & Resources Website
Where Does My Money Go?
You can pay a funeral provider directly and often lock in current pricing. This is an option if you plan to remain at the same location or if the funeral provider has multiple locations.
Or, payments made to an insurance company are used to pay expenses and establish reserves, which are used to pay future claims benefits as they come due. It can be set up so that the fund grows over time to help cover the rising cost of funerals. At the time of death, the death benefit is paid to the funeral home after the funeral home delivers the merchandise and services. This allows flexibility to choose the provider of your choice.
With “Final Expense” insurance you can choose any amount of money to be paid to your beneficiary at the time of your death. You may specifically designate this money to help pay for your funeral arrangements or expenses related to death, whatever they may be.
If your parents or loved ones have left behind debt, in many cases you will not be held personally accountable, unless you cosigned on a loan or account. But there are different laws and it sometimes varies by state and by type of debt. Be sure to check with a professional. Debt collectors have been known to pursue families of the deceased and insist they are accountable when they are not.
However, the estate of the deceased will typically be responsible for the debt. Money or assets must be used to satisfy debt before it is distributed to heirs. It is important to wait before dividing assets to heirs until you are sure debts have been satisfied. Typically creditors have a fixed period of time — usually between two and six months — to make claims against your parent’s estate. Even though you may not be responsible for paying the debts, they may still reduce — or wipe out — what your parent intended to leave you.
A 401(k) or IRA. It will only be protected from creditors if someone is listed as a beneficiary on the account itself. Otherwise, it will be rolled into the estate, and creditors can make claims against it. Make sure a beneficiary is listed or a loved one is designated as a cosigner.
“Community Property States” are different. One spouse can be liable for the debts of another, even if they didn’t agree to them or even know about them. These states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin and, if you choose it, Alaska.
Identity theft has become a major and even sophisticated criminal activity. An inactive credit file, particularly of someone who has passed, can be an open invitation for credit fraud. Some precautions you can take:
- Alert the three major credit reporting bureaus, Equifax, Experian and TransUnion of the passing of your loved one. You’ll need to identify yourself, include the deceased birthdate, date of death, Social Security number and most recent address. Include a copy of the death certificate. Tell them “Do not issue credit”.
- You can also request a credit report so you’ll have a record of all open credit accounts.
- Cancel any credit cards that are in their name only.
- Change any cards or accounts that have both names to a new card with only your name.
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