How Do Prepaid Funeral Plans Work?

How Do Prepaid Funeral Plans Work

Planning a funeral can be stressful and overwhelming. You want to honor your loved one the best you can, but grief makes everything difficult. Moreover, you are not even sure how your loved one wanted to be honored.

If you have been through this, you may want to plan your own funeral before your death. This will ensure your wishes are met and ease the burden on your loved ones during this difficult time. Read on to learn how prepaid funerals work.

How Do Prepaid Funeral Plans Work? 

Prepaid funeral plans are agreements with a funeral home to cover the funeral costs in advance. You can pay for the plan in a lump sum or monthly installments. Prepaid funeral arrangements allow you to lock in the expenses for the services and goods included in your plan. This protects you from inflation and ensures your family won’t have to shoulder the financial burden at a difficult time.

Many people usually confuse a prepaid funeral plan with a last-expense insurance policy. While both can be used to cover immediate expenses related to a funeral, they are very different. With last expense insurance, the assigned beneficiary will receive death benefits upon the policyholder’s death. They can do whatever they want with the money, including paying funeral costs or hospital bills. However, the funeral home is the beneficiary of a prepaid funeral plan. They’ll use the money to cover funeral costs as directed by the deceased.

What Is Included In A Prepaid Funeral? 

All prepaid funerals are not the same. What is included will vary depending on the provider and your chosen plan. A prepaid funeral plan can be either a revocable trust, an irrevocable trust or a pre-need policy. With a revocable trust, you can control the money and make any changes, including terminating the contract. With an irrevocable trust, you cannot change the plan. Ultimately, you can choose a pre-need policy, which works like life insurance but with the funeral home as the beneficiary.

That said, what exactly is included in a prepaid funeral plan? No two prepaid funeral plans are the same. Experienced funeral directors will customize your plan according to what you need. However, this will also affect the final price you pay. Every plan will detail all services that are guaranteed. In most cases, they include:

  • Basic services like embalming, dressing and casketing the body, using the funeral home facilities for visitation and the service itself.
  • Casket or urn.
  • Facility fees for using the funeral home’s facilities and staff for the service.
  • Transfer of the body from the place of death to the funeral home.
  • Obtaining a death certificate.

What Is Not Included In A Prepaid Funeral? 

As mentioned above, prepaid funeral plans are not created equal. While the above services are guaranteed in a standard plan, the following services are not included, so you can either purchase them as add-ons or your loved ones will be responsible for them.

  • Cemetery plot
  • Flowers, catering or after-funeral gathering
  • Transportation of family and friends to and from the funeral home
  • Obituary notices

Are Prepaid Funerals Worth It? 

Whether a prepaid funeral plan is right depends on your circumstances and preferences. You need to weigh the pros and cons of prepaid funeral plans’ and consider your budget as well as your desires for your funeral. According to the experienced funeral directors at Southern Cremations & Funerals, you’ll have peace of mind knowing all agreements are taken care of with a prepaid funeral plan, and you’ll lock in rates, meaning you are protected from rising inflation costs. Conversely, you may not be able to change your wishes later unless it’s a revocable plan.


Prepaid funeral services are ideal if you want control over your funeral. However, to enjoy the benefits of these services, you need to find a reputable funeral home and discuss your options with a trusted funeral director.

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