What Is a Funeral Pre-Plan and Should I Get One?
By CRYSTAL BAI •
The short answer: A funeral pre-plan is an arrangement made with a funeral home in advance of death — documenting your wishes for service type, disposition, and merchandise (casket, urn), and often prepaying for these services at today's prices. Pre-planning protects your family from making painful decisions under grief, ensures your wishes are known, and can lock in pricing. Whether to prepay requires careful evaluation of the funeral home and the contract.
What Funeral Pre-Planning Includes
A pre-plan typically documents:
- Type of service (funeral, memorial, celebration of life, graveside only)
- Disposition preference (burial, cremation, natural burial, aquamation)
- Casket or urn selection (if prepaid)
- Cemetery and burial plot information
- Preferences for music, readings, flowers, officiants
- Obituary information
- Contact list for notification
Pre-Planning Without Prepaying
You can pre-plan without prepaying — document your wishes with a funeral home or in your own written record, and share with family. This ensures your wishes are known without the financial commitment of prepayment. It has no cost and can be changed at any time.
Prepaying: Pros and Cons
Pros of prepaying:
- Locks in today's prices (protection against inflation)
- Removes financial burden from family at time of death
- May be required or beneficial for Medicaid eligibility planning (prepaid funeral trusts are often exempt from Medicaid asset calculations)
Cons of prepaying:
- Funeral homes can go out of business — know what happens to your money (trust account vs. insurance policy)
- Contracts can be restrictive if you move or change your mind
- Some contracts are irrevocable (required for Medicaid spend-down)
- Returns on funeral trust funds may be low compared to other investments
What to Watch Out For
Under the FTC Funeral Rule, funeral homes must:
- Tell you whether funds are held in trust or used to purchase insurance
- Provide a full accounting of how your money is protected
- Allow you to receive a full refund (unless irrevocable for Medicaid)
Ask: What happens if this funeral home closes? What if I move? Can I transfer the contract? Is this revocable or irrevocable?
Alternatives to Funeral Home Pre-Plans
Consider: a Totten trust or payable-on-death account earmarked for funeral expenses; a life insurance policy; or simply documenting wishes without prepaying and ensuring family knows where the documentation is.
Frequently Asked Questions
Is prepaying for a funeral a good idea?
It depends on your situation. Prepaying protects against price inflation and simplifies decisions for your family. But choose carefully — the funeral home must be financially stable, and the contract must protect your money with a third-party trust or insurance. Consult a financial advisor before committing.
Can I pre-plan a funeral without using a funeral home?
Yes — you can document your wishes in detail and share with family without involving a funeral home. Some death doulas offer pre-planning facilitation that results in a written wishes document your family can use to shop funeral homes when needed.
What is an irrevocable funeral trust?
An irrevocable funeral trust is a prepaid funeral arrangement that cannot be revoked or the funds reclaimed — often required for Medicaid spend-down planning. The asset is excluded from Medicaid calculations because it's legally committed to funeral expenses.
What happens to my prepaid funeral if the funeral home closes?
If funds were properly held in a state-regulated trust (required in most states), they should be available to transfer to another funeral home. If held through an insurance policy, the policy travels with you. Always get this in writing before signing.
Should I pre-plan a funeral for my parents?
You can help your parents pre-plan, but the plan should be in their names and reflect their wishes. A death doula can facilitate a family conversation about preferences before engaging a funeral home.
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