Should I Buy a Pre-Paid Funeral Plan?

Pre-paid funeral plans can be a useful part of an estate plan. A traditional estate plan considers how your assets will best be divided upon your death. Why not finish your plan by providing for your funeral now?

Pre-Paid Funeral Plan AdvantagesPre-Paid Funeral Plan in New Jersey

While detailing your funeral may not be amongst the happiest chores in your life, doing so will ensure that your wishes are followed and that there is money available at the time it is needed. Your plan will relieve your family of the need to make these decisions and maybe face financial concerns at an unwelcome time. For others, such as those receiving Medicaid or SSI benefits, such a plan is essential.

How To Create A Pre-Paid Funeral Plan

Creating a pre-paid funeral plan simply requires a meeting with your family’s funeral director. At that time, you will discuss your wishes in detail, such as burial, entombment, cremation or donation, and any other details you may wish. The funeral director will draft an itemized invoice for your choices and the pre-paid Trust Agreement. You will sign the documents and make a payment, usually to the New Jersey Prepaid Funeral Trust Fund. You can pay the entire amount or make payments over time.

How Safe Is My Account?

The money you pay is not held by the funeral director. Instead, it is sent to a trust company, usually the New Jersey Prepaid Funeral Trust Fund. The Trust Fund invests the money in jumbo certificates of deposit, along with money received from many other people. The deposits are FDIC insured, and the money is available immediately to pay for your funeral when needed. Interest earned is credited to your account. If you change your mind, you can terminate the account at any time, unless, of course, you are a Medicaid or SSI recipient in which case the trust is irrevocable.

How Is the Account Used?

Upon your death, the money is immediately available to pay for your funeral. It can be used by any funeral home and is readily accessible. Any money remaining after the bill is paid becomes part of your estate and is distributable to the beneficiaries in your Last Will and Testament. If you are on Medicaid or SSI, however, any remaining money is paid to the State. For further information, contact your local funeral director or visit