Canadian Money Forum banner

1 - 20 of 45 Posts

·
Registered
Joined
·
3,936 Posts
Discussion Starter #1
I once knew someone who strongly believed in this idea after the passing of her mother, she didn't want her family to have to worry so much when she passed. So she chose her plot and funeral home in her living years, I believe even pre-paid for it. I think I like the idea, that will minimize the disruption to those I leave behind.

http://www.lahaiesullivan.com/pre_planning.html

Does anyone here believe in or do this? Thoughts?
 

·
Banned
Joined
·
156 Posts
I ABSOLUTELY RECOMMEND this from personal experience. Recently had to go through bury a family member and this was not done. It REALLY SUCKS.

Because of the rapid rate of decay of a body after someone dies, you don't have any time to plan out a funeral after hearing the news. You have days, not weeks to arrange everything, from religious services, to cemetery plots, to contacting everyone, obituary, to the funeral home etc. All while you're still in shock of a serious loss. We're talking a cost of $5000-$15000 thousand depending on what arrangements you choose that you have to shell out within 2 or 3 days of first receiving the message.

1.) It absolutely sucks talking about money when you're still raw with grief.
2.) You're not going to shop around for any deals because
a) you just wanna get it done at the time
b) you don't have any time to wait

The more decisions you can make ahead of time (like choosing your burial plot, will etc), the less emotional and financial hardship you put on your family members if it happens. Even though a funeral is technically for you, in reality its really there for your friends and family to grieve and try and deal with you not being around any longer in their lives.

If you're in a position to make arrangements, I HIGHLY RECOMMEND IT. Most people assume they'll die a long ways away of old age, but never factor in accidents like car crashes etc. My advice generally falls on deaf ears though because most people don't want to think about themselves dying and therefore don't plan at all.
 

·
Registered
Joined
·
420 Posts
I come from frugal people. Most of my elderly relations pre-planned their funerals before July of 2010 to beat the HST. The other benefit (according to them) is that you get to pay for your funeral in today's dollars instead of future dollars.
 

·
Registered
Joined
·
3,936 Posts
Discussion Starter #4
Thanks so much hypo - that is exactly the kind of response I was hoping for. I've recently contacted my lawyer to get a will written up, but I didn't have any of these funeral arrangements done at the time. I still don't. I can't imagine my survivors would want to shell out that kind of money. Better for me to pay for this myself in advance once I have decided where I want to be buried. Or perhaps cremation. Not sure.

I think we're programmed to avoid discussing this topic. I admit it's quite uncomfortable to discuss these things, especially with those you are close to. But from little I know, this is really the kind of thing that should be arranged in advance. That way if something unexpected should occur, things will be addressed and not cause hardship for my survivors.
 

·
Registered
Joined
·
2,892 Posts
My grandmother had done this. It made things alot easier for my family. Everything was arranged ahead of time.

It was kinda funny though, as she lived a long life. The original amount she paid was about $3000, but the final tab came to $12000. After everything was adjusted for inflation/invested amount, our family had to pay a few hundred dollars, no big deal.
 

·
Registered
Joined
·
3,936 Posts
Discussion Starter #6
The original amount she paid was about $3000, but the final tab came to $12000. After everything was adjusted for inflation/invested amount, our family had to pay a few hundred dollars, no big deal.
I am surprised to hear this. I thought the whole idea of pre-payment was to avoid what you described. The website I provided lists locking in at today's prices as one of the benefits.
 

·
Registered
Joined
·
2,626 Posts
Most of my family has done this. If you think Canadian real estate is out of control, pricing on burial plots has easily increased 10-20X in the past 10 years.

I think of it as picking the view you will be stuck with for eternity, don't want to buy next to a bad neighbor. ;)
 

·
Banned
Joined
·
429 Posts
Most of my family has done this. If you think Canadian real estate is out of control, pricing on burial plots has easily increased 10-20X in the past 10 years.

I think of it as picking the view you will be stuck with for eternity, don't want to buy next to a bad neighbor. ;)
*laughing* ... now, what if you really don't like your spouse?

On a more serious note, my parents have done this. I'm inclined to buy a nice property and get cremated there instead. I think it's cheaper!
 

·
Registered
Joined
·
2,892 Posts
I am surprised to hear this. I thought the whole idea of pre-payment was to avoid what you described. The website I provided lists locking in at today's prices as one of the benefits.
I am not really sure of what was offered 20 years ago, when she originally purchased. I am also not sure if you get any choices as to how your deposit or payment is invested. Perhaps she chose something conservative.

What's a couple of hundred bucks, in a situation like this. Everything was decided, and planned ahead of time, so there was no stress in that regard.

I didn't mean for it to sound like I was complaining, or that pre paying was bad or anything. I thought it was great that everything was done ahead of time, and would consider doing the same in the future. (hopefully several years in the future :) )
 

·
Banned
Joined
·
2 Posts
Agree with preplanning

We totally agree with preplanning.
We bought our cemetery plot 10 years ago.
Our wills are up to date.
The funeral home is known, creamation, rented casket for the service, not paid yet.
We are in the process of finalizing the grave marker, to be placed without the final dates.
Our 2 children think that we have done too much, but I'm sure when the time comes they will appreciate it.

We are both 70 and in good health.
 

·
Banned
Joined
·
52 Posts
Great thread Royal!

I'm actually a Licensed Funeral Director as well as I specialize in pre-planning and hold a Life Insurance License to sell burial/final expense insurance. Basically, the ways to pre-fund a funeral are:

1. Funeral/final expense insurance - Regular life insurance won't allow funeral homes to honour and lock-in today's prices. The reason being is the accumulated growth within the policy belongs to the policy holder, not the funeral home. Actual funeral/final expense insurance assigns polices to funeral homes, keeping them tax-free to the policy owner, and accumulated growth helps keep up with inflation for the funeral home. Therefore, those can be used to lock in prices. Installment payments may be made or you can purchase a lump-sum annuity with these plans.

2. Lump-sum payment to a funeral home, which is in turn put into a trust account. Each province has there own guidelines, but here in Nova Scotia, the funeral home takes 10% of the deposit as an administration fee. The funeral home also gets to keep all accumulated interest if the client decides to move or transer funeral homes. Insurance is different in the way the policy owner owns the policy and they are transferble at no charge.

Some families pre-plan their services without pre-funding them as well for various financial reasons (CPP Death Benefits, Life Insurance, etc.)

Well it's late and I just got in and can't really think of much else to write. I'll check back tomorrow and answer any questions :)
 

·
Registered
Joined
·
2,974 Posts
We did this for my grandmother when she first had her heart attack stroke. It definately made it easier 7 years later when she passed away.

At the same time we've helped our parents make their arranges. This was almost 20 years ago. As a family, we have said that planning out these things ahead of time makes it much easier in the long run. Our family is pretty open when it comes to finances and estate planning, which helps.
 
Joined
·
166 Posts
. . . from frugal people. ..... you get to pay for your funeral in today's dollars instead of future dollars.
Thanks all, for sharing insights. I like Dana's comment and her humour :)

1. Pre-planning saves much anxiety for a family as many have mentioned above. It deserves family discussion, and a written intent to guide family members in the general or specific terms that will be most helpful in our personal circumstances.

2. Pre-paying is less clear. If one has life insurance at the time of death, that is nearly always going to be more cost efficient than pre-paying. (Oh but however, I don't like the advertised non-medical insurances for seniors; way too expensive.) Life ins done well should cost "pennies on the dollar" - and thus much less expensive than pre-paying costs of death.

3. Added ZIP is owning life insurance and including the charity(ies) of your choice as beneficiary. You can have sufficient tax refund to exceed cost of death. Many seniors have enough money in chequing account to cover death costs. Tax refund from the insured charitable gift can then replace all death costs (and more)! If ins. is "pennies on the dollar", then the tax refund makes it free altogether???

If we're truly frugal, and charitable as well, would we pre-plan for free?

BW
 

·
Banned
Joined
·
52 Posts
Can I pre-arrange my funeral, choose my casket and cemetary plot in my living years on the assumption that my life insurance plan will pay the costs to my beneficiary at the time of my death?
Yes and no. Generally all funeral homes will allow you to choose your services and merchandise (casket, vault, etc.) without prepaying. Of course you don't get "today's" pricing, but if you're not prepaying than that should be expected. This is known in the funeral business as "preplanning". Cemetery lots are a different story (at least in my province). You will most likely want to physically choose your lot\plot, so you'd in fact be issued a deed for that piece of land. Life insurance only pays out upon death, so you wouldn't actually get to choose your lot\plot. Another factor when deciding to use your life insurance policy for final expenses is your face amount and your age and try and factor an estimated inflation. I can tell you that traditional services have doubled in price since the late 80's.
 

·
Registered
Joined
·
2,974 Posts
Thanks all, for sharing insights. I like Dana's comment and her humour :)

3. Added ZIP is owning life insurance and including the charity(ies) of your choice as beneficiary. BW
Just a side note, based on the advice of our lawyers, was not to reduce the number of name to beneficiaries such as charities, if you have an estate that you plan to leave to loved ones, especially if you will have a sizable estate.

The reasoning was there have been cases where charities are named as a beneficiary (not the sole one), and they have gone after the estate for more, using the Estates money to dispute the will. The charity has nothing to lose, just the rest of the beneficiaries. Our lawyer advised us to instead of naming the charity to have our executor have our wishes in terms of the charity.
 

·
Banned
Joined
·
946 Posts
Just a side note, based on the advice of our lawyers, was not to reduce the number of name to beneficiaries such as charities, if you have an estate that you plan to leave to loved ones, especially if you will have a sizable estate.

The reasoning was there have been cases where charities are named as a beneficiary (not the sole one), and they have gone after the estate for more, using the Estates money to dispute the will. The charity has nothing to lose, just the rest of the beneficiaries. Our lawyer advised us to instead of naming the charity to have our executor have our wishes in terms of the charity.
Could you explain that more fully, please, Plugging Along. I don't understand how a charity could go after more than the will specified the charity was to receive.
 

·
Registered
Joined
·
2,974 Posts
I may not get all the details right, as I'm not a lawyer. Essentially, the general advice was to try and limit the number of people you actually name in the will to only those who you really want the money.

Although anyone can contest a will, however, anyone listed has more of a right to contest it. Charities that are listed, can (and some have) actually gone back and said they are entitled to more. This is applies especially if you are giving them a percentage. If it's a dollar amount, they can do so to, but it's harder. They contest the will at the expense of the estate, and hold everything up. From the charities point of view, they have really nothing to lose, as it's the estate that pays the fees. Our lawyer advised us that we were better off getting our executor/family to act upon our wishes. It's not that it happens often, but it does happen.
 

·
Banned
Joined
·
946 Posts
Thanks for the information. I remember a case that came before the court in B.C. many years ago where a woman had made some hand-written changes to her will without consulting her lawyer. The original will had left a certain amount to a well-known charity and the residue to family members. I don't remember the details, but the end result was that the change she made inadvertently changed things so that the charity was entitled to most of the estate. The judge said he had no choice but to find in favour of the charity, but he commented that he was sorry to have to do so, because it was clear that it was not the deceased's intent.

What was different about this case was that it caused so much bad publicity against the charity that their regular donations dropped steeply; many regular donors (including some extremely generous ones) informed the charity that they would never again make a donation unless the charity did the right thing. The charity, which had originally insisted that the money was legally theirs and they had no intentions of giving it up, changed their mind and passed it on to the original beneficiaries.

Something that came out in the media reports of this case is that the charity (and apparently many charities) had an employee whose duties included perusing the obituary columns every day watching for the names of people who they had reason to believe planned to leave them a bequest. The whole incident left a sour taste in my mouth about the business practices of charitable organizations.
 
1 - 20 of 45 Posts
Top