FAQ About Prepaid Funeral Plans
Coping with grief while also having to plan a funeral can feel overwhelming. Families who’ve just lost a loved one often face difficult and sometimes urgent decisions. They may need to rely on guesswork about their loved one’s wishes if funeral preferences weren’t discussed. They may also find themselves with a stressful, unplanned expense.
Choosing a prepaid funeral plan and talking about end-of-life arrangements long before it’s time for goodbyes can give a family an entirely different experience—one focused instead on honoring a loved one’s wishes and celebrating their life.
Understanding prepaid funeral plans can help you make the right decision for yourself and the people who love you. Here we answer 10 of the most frequently asked questions about prepaid plans.
- What is a prepaid funeral plan?
- How do prepaid funeral plans work?
- What do prepaid funeral plans cover?
- How much do prepaid funeral plans cost?
- Can I prepay for a funeral on an installment plan?
- What happens if you miss a prepaid funeral payment?
- Do prepaid funeral plan payments help someone qualify for Medicaid?
- What happens if the provider from which I purchased my prepaid plan goes out of business?
- What happens to my prepaid funeral plan if I move?
- Are prepaid funeral plans a good idea?
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What is a prepaid funeral plan?
With a prepaid funeral plan, you clearly outline your wishes for your funeral or cremation, choose the specific services and products you want, and then pay for these arrangements in installments over time or with a lump sum payment.
A prepaid funeral plan allows you to choose exactly how you’d like your funeral or cremation, down to the smallest details. By prearranging the specifics with a funeral home in advance, you relieve your loved ones of the burden of planning your service when the time comes.
Learn more about prepaid funeral plans.
How do prepaid funeral plans work?
Taking into account your own preferences and end-of-life discussions with loved ones, you’ll craft an end-of-life plan that reflects your faith, culture and personal preferences. Whether you’d like a celebration of life after a cremation, a traditional funeral followed by a cemetery burial, a composting after which your dirt is returned to a forest—the choices are all yours.
When you meet with a planning advisor, you get to consider every detail. Do you want a pink granite headstone? A burial at sea? A big catered celebration? An intimate scattering ceremony? No matter what you decide, a planning advisor will help you create a written plan to share with your family and explain your funding options.
Then you sign a contract and make payments on your plan. After your death, the provider will bring your vision to life, minimizing stress on your family.
Learn more about how prepaid funeral plans work.
What do prepaid funeral plans cover?
A prepaid funeral plan is created by you, so it covers the things you decide are important. You can plan a simple gathering or a grand event. For traditionalists, it can include embalming, a casket, flowers, catering and cemetery property. Or you could elect for a simple cremation after which your family divides your ashes among them.
When you meet with a planning advisor, you'll learn about your options.
Learn more about what prepaid funeral plans cover.
How much do prepaid funeral plans cost?
Prepaid funeral, cremation and cemetery plans set aside funds for specific products and services. A pre-paid plan covers the cost of your choices. Prepaid plans usually start in the low thousands. According to the National Funeral Directors Association, in 2023 the median cost for a funeral with a casket was $8,300; the median cost for a cremation with an urn was $6,280.
Prepaid plans are usually payable in installments over 3 to 10 years.
Learn more about funeral and cremation costs.
Can I prepay for a funeral on an installment plan?
Paying for funeral expenses over time on a monthly installment plan, either through financing or funding with an insurance policy, is a way to budget for end-of-life arrangements. When you choose products and services to include in your plan, you lock in today’s rates on many of those items. What you pay each month will depend on many factors.
Learn more about paying for a funeral in monthly installments.
What happens if you miss a prepaid funeral payment?
A prepaid funeral plan is similar to car insurance in that if you miss a payment, you receive a lapse warning. After 90 days of nonpayment, your plan may be canceled. If that happens, you'd still be able to use that money to fund future arrangements, but you would lose any price protection.
Learn more about price protection.
Do prepaid funeral plan payments affect the ability to qualify for Medicaid?
When you buy a prepaid funeral plan, it's generally excludable from the Medicaid spend-down process. Unlike traditional insurance, it generally won’t affect your ability to qualify for Medicaid. However, many states limit the amount you can put into a funeral plan to between $5,000 and $15,000. Please discuss any concerns with your pre-planning professional and your Medicaid caseworker to make sure your needs are met.
Learn more about using a prepaid funeral plan for Medicaid spend down.
What happens if the provider from which I purchased my prepaid plan goes out of business?
When you plan with a Dignity Memorial® location, your money is kept safe by a third party (an insurance company or a trustee, not the funeral home) until the time of your funeral. Then it is given to the funeral provider to cover your funeral or cremation expenses when needed.
Learn more about insurance and trusts.
What happens to my prepaid funeral plan if I move?
When you choose a Dignity Memorial provider, your prepaid funeral, cremation and/or cemetery plans are easily transferred to one of our 1,900+ locations in 47 U.S. states, Canada and Puerto Rico when you move more than 75 miles away.
Relocation protection is part of the Dignity Difference, and it’s just one of the many benefits that sets us apart from other funeral and cremation providers. Other benefits include our Purchase Protection Plan and the flexibility to add to your plan anytime you wish.
Learn more about the Dignity Difference.
Are prepaid funeral plans a good idea?
A prepaid funeral plan offers relief to your loved ones at a difficult time. Arranging and financing your own end-of-life arrangements in advance means your family won’t need to shoulder the financial and emotional burdens of making decisions on your behalf and covering the costs involved.
Making final plans now is one of the most thoughtful gifts you can give your family. And, when you plan ahead, your Dignity Memorial professionals can help you coordinate every detail to create a personal, meaningful tribute.
See what else people had to say about prepaid funeral plans.
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