(3 Minute Read)
It’s not easy to talk about, but funeral costs are a very real part of death. As your parents get older, it may be time to start thinking about what will happen after they pass away. According to the National Funeral Directors Association, funeral costs are often staggering and can cost on average $6,500. That’s not even counting additional niceties like flowers, obituary notices, and more. This is why it’s important to have a conversation with them about what they would want for themselves and how you can begin to plan for it.
What Kind of Funeral Do They Want?
Funerals aren’t cut and dry. They can involve multiple viewings, no viewings, a burial, a cremation, and many other options. Begin the conversation by discussing what your parent(s) would like for themselves after they pass. Do they want to be buried? Cremated? Do they want a showing, or no funeral at all? With each answer there’s a different accompanying cost. Burial means purchasing a plot of land and a tombstone. Cremation might not have these specific costs, but it has its own procedure.
When you have an idea of what they want, you can put together a plan to pay for it.
Planning for Funeral Costs
Many seniors won’t have the kind of money to pre-pay for their funeral costs. In fact, many seniors are in danger of outliving their retirement savings anyway. In these cases, it usually becomes the responsibility of their children to plan for the costs of the funeral. Of course, many people—including seniors—don’t realize that they have more assets than they think they do.
For example, if they’re living in a home that is double the size that they need, you may consider talking to them about downgrading into a smaller home, or an apartment. The cost savings can be funneled into a savings account that can help pay for funeral costs when the time comes. Alternatively, if your parents have more than one car, they can sell the spare vehicle.
A third option that many people don’t consider is life insurance policies. Unwanted or unneeded life insurance policies can be sold in a life settlement. In a life settlement, the policy’s owner transfers the ownership of that policy in exchange for an immediate cash payment from the buyer. Candidates for life settlements are typically 70 or older, with a life insurance policy that has a “face value” (death benefit) of more than $100,000. The money earned from a life settlement can go a long way in planning and pre-paying for funeral and burial costs.
Burial and funeral costs are always an uncomfortable subject to discuss, but having a plan in place can make that time much less stressful. Use our qualification calculator now to see if your parent(s) qualify for a life settlement.