Many people choose to pay for a funeral in advance with a prepaid funeral plan. Funeral plans with a special “preneed” contract funded with an insurance policy, trust, or annuity offer several benefits. Preneed policies can be paid in full or set up on installment plans with a set number of payments that fit into your budget. The funds go to a specialized insurance company and offer growth with certain tax advantages. The plans are also transferable to another funeral home should you move away. Irrevocable prepaid funeral plans can also be set up as Medicaid-exempt assets to help you qualify for Medicaid later in life, if needed.

Some families choose to cover funeral expenses with a life insurance policy or final expense policy. While this is a common practice, it is not without some concerns. If you want to use a life insurance or final expense policy, the funds are often not available right away. You must find another way to pay for the funeral expenses up front and receive a reimbursement from the insurance company at a later time. Most of the time, it takes 6 to 8 weeks to receive a reimbursement. If you elect to use this type of policy, be prepared for the possibility that you will need another form of payment first.

Some families choose to set up a pay-on-death account with a named beneficiary. This option allows your assets to be available to your heirs without having to go through probate. However, there are a few disadvantages to maintaining a personal pay-on-death account. With each year that goes by, the purchasing power in your account actually goes down. In addition, these types of accounts do not generally offer a sufficient amount of interest to offset inflation over time. Personal accounts are also at risk of being used or seized due to civil judgments, bankruptcy, or divorce.

Another possibility to pay for a funeral is using cash or credit card or taking out a personal loan. If you want to look into a funeral loan, some lending companies offer families no interest for the first few months. To learn more about how to apply for a funeral loan, speak with your funeral director or your bank to discuss the best way to proceed.



As you’ve no doubt seen, families can also use a crowdfunding website to pay for a funeral. These sites provide efficient ways to receive the financial support needed to craft a meaningful ceremony. Please note that most crowdfunding sites deduct a small percentage of the money raised for transaction and processing fees.



Contact us today to learn more about each of these funding options! We are here to make the funeral planning process as smooth and clear as possible, so if you have questions, we’re here to help.

Keep in mind that you are eligible for many burial benefits through the Department of Veterans Affairs. These benefits include burial allowances, free or low-cost veteran cemetery options, a government-issued headstone, and more. By taking advantage of these unique benefits, you can save money and honor your time in military service. Let us know if you’d like to learn more!