Life Insurance versus Pre-paid Burial

[GAKKIEZ]

  I hear commercials all the time pushing Life Insurance for seniors.  I do have Life Insurance but I also have a pre-paid burial plan.  I usually tell other family members that if they don't have a spouse/family member counting on a Life Insurance payout or a large amount of debt, they should focus on pre-paid burial plan. (Let family members know you have this and that your wishes have been made in advance.)

So many families seem to stress that they don't have Life Insurance.

[Winter2025VA]

@GAKKIEZ , in your opinion, is it TOO LATE for me at age 66 to get Life Insurance?

Dirk's @DirkB349973 post mentions $10 a month for Life Insurance is too high.

Hmmm, maybe I should just skip it.

Thanks,

Nicole

[GAKKIEZ]

  I don't believe it's too late but I'm not an expert on Life Insurance products.  You should ask yourself several questions.  Why do I need Life Insurance? What are my obligations? What is a realistic amount that I need?  I'm sure you may come up with additional questions.

  I took out my Life Insurance when I was a single mother of 2 and needed to look out for them. After they left home, I converted that policy to one with a money market account. (Good decision for me. The money market account is now far more than the basic life insurance I took out.)

[Winter2025VA]

@GAKKIEZ , my main concern at age 66 is NOT burdening my only child with my Cremation Expense. She is the ONLY family who cares. I saw what she went through when her dad died unexpectedly.  Thanks, Nicole

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[*** GAKKIEZ wrote:  I don't believe it's too late but I'm not an expert on Life Insurance products.  You should ask yourself several questions.  Why do I need Life Insurance? What are my obligations? What is a realistic amount that I need?  I'm sure you may come up with additional questions.

  I took out my Life Insurance when I was a single mother of 2 and needed to look out for them. After they left home, I converted that policy to one with a money market account. (Good decision for me. The money market account is now far more than the basic life insurance I took out.) ***]

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[Winter2025VA]

@GAKKIEZ , I just wanted say how much I appreciate this discussion.

Thanks for creating it.

HAPPY Monday!!!

Nicole  🙃🙃🙃

[GAKKIEZ]

  Thank you Nicole!  I talk with family about this often (even young ones starting out).

[DirkB349973]

A pre-paid burial makes a lot of sense to me. Life Insurance is also a way to leave an "estate" to your loved ones when you don't actually have an estate. If you are older and you haven't already purchased life insurance, you may end up paying a lot for a very small amount of coverage. These $10/month plans you see on TV are overpriced.

[Winter2025VA]

Dirk @DirkB349973 , I donot have an "estate" - in your opinion, what should Life Insurance cost for me at age 66 now IF I got some. Thanks, Nicole

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[*** DIRK wrote: A pre-paid burial makes a lot of sense to me. Life Insurance is also a way to leave an "estate" to your loved ones when you don't actually have an estate. If you are older and you haven't already purchased life insurance, you may end up paying a lot for a very small amount of coverage. These $10/month plans you see on TV are overpriced. ***]

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[DirkB349973]

@Winter2025VA,

My first question would be, why do you need an "estate"? Do you have children or grandchildren you are caring for? I think for most people of average means, 66 is a little late to be purchasing life insurance. 

[Winter2025VA]

No grandchildren as yet and my only child is self sufficient and on her own. Just concerned about Cremation Expense for my only child. Only family who cares. Thanks for responding Dirk @DirkB349973  👍

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[*** DIRK  wrote: My first question would be, why do you need an "estate"? Do you have children or grandchildren you are caring for? I think for most people of average means, 66 is a little late to be purchasing life insurance. ***]

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[DirkB349973]

You could lock down your cremation expense with one of the prepaid options. Last time I checked, a prepaid cremation in my area ran around $2500. The company I talked with was willing to take monthly payments. It sounded like all you had to do when someone passed was notify them and they picked up the body and took care of things.

[Winter2025VA]

Thanks Dirk @DirkB349973  👍

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[*** DIRK wrote: You could lock down your cremation expense with one of the prepaid options. Last time I checked, a prepaid cremation in my area ran around $2500. The company I talked with was willing to take monthly payments. It sounded like all you had to do when someone passed was notify them and they picked up the body and took care of things. ***]

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[Winter2025VA]

@GAKKIEZ  , I am assuming it is prepaid to a certain funeral home? IF yes, what happens IF place goes out of business or price increases?

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[*** GAKKIEZ wrote: I hear commercials all the time pushing Life Insurance for seniors.  I do have Life Insurance but I also have a pre-paid burial plan.  I usually tell other family members that if they don't have a spouse/family member counting on a Life Insurance payout or a large amount of debt, they should focus on pre-paid burial plan. (Let family members know you have this and that your wishes have been made in advance.)

So many families seem to stress that they don't have Life Insurance. ***]

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[GAKKIEZ]

  Yes, to a specific reputable funeral home.  Most funeral homes that offer this service have plans that are underwritten by insurance and many are protected from price increases.

  Also, check/update your will to include this info and to ensure the pre-paid burial cannot be attached should you need to go into a state/federal subsidized nursing home.

[Winter2025VA]

Thanks @GAKKIEZ 👍

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[*** GAKKIEZ wrote: Yes, to a specific reputable funeral home.  Most funeral homes that offer this service have plans that are underwritten by insurance and many are protected from price increases.

  Also, check/update your will to include this info and to ensure the pre-paid burial cannot be attached should you need to go into a state/federal subsidized nursing home. ***]

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[GailL1]

@Winter2025VA 

You can go thru a funeral home that offers this service or you can go thru a burial society.  

With either of these the parties come up with the price of the funeral that you want - they also look at your age in the cost - you then buy a financial instrument like a Certificate of Dposit that earns interest - it is in your name for the specific purpose of burying you in the the specified manner you want.  Any price increase is offset by the interest it earns.  The funeral home or the burial society is the beneficiary of the policy - if they don’t exist for some reason it goes back to your estate for the specific purpose.

You can also do it the same way on your own.  Buy a CD with the cost of the burial (plot included if necessary), set it up in your Will that it is specifically for this purpose and let any interest earned go towards any increase in price.  Then all you do in your will is outline your wishes - the how and the plot for your executor to follow thru on.  

If people don’t have the money to pay for this type of investment or they can’t begin to save for it - then some people buy a life insurance product that will cover it.  The older you are, the more it will cost per month; the more elaborate your wishes, the more it will cost to cover.  

But if you are gonna be paying monthly money for an insurance product for this purpose, you can accomplish pretty much the same thing by paying that monthly money into a savings account and letting it begin to grow.

It just has to be a consistent funding - or consistent payment each month.  A credit union will open an investment savings account for as little $ 50 - then one just keeps adding to it month after month.

[Winter2025VA]

Gail @GailL1 , cremation for me. Thanks for info.

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[*** GAIL wrote: You can go thru a funeral home that offers this service or you can go thru a burial society.  

With either of these the parties come up with the price of the funeral that you want - they also look at your age in the cost - you then buy a financial instrument like a Certificate of Dposit that earns interest - it is in your name for the specific purpose of burying you in the the specified manner you want.  Any price increase is offset by the interest it earns.  The funeral home or the burial society is the beneficiary of the policy - if they don’t exist for some reason it goes back to your estate for the specific purpose.

You can also do it the same way on your own.  Buy a CD with the cost of the burial (plot included if necessary), set it up in your Will that it is specifically for this purpose and let any interest earned go towards any increase in price.  Then all you do in your will is outline your wishes - the how and the plot for your executor to follow thru on.  

If people don’t have the money to pay for this type of investment or they can’t begin to save for it - then some people buy a life insurance product that will cover it.  The older you are, the more it will cost per month; the more elaborate your wishes, the more it will cost to cover.  ***]

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[GAKKIEZ]

 Even with cremation you have to find a way to pay for it and how to inter/dispose of the ashes.

[Winter2025VA]

Hi @GAKKIEZ , when I first retired in 2020, I finally sat down and made a list of End Of Life stuff.

Will, cremation and so on.

I did get a QUOTE from a Funeral Home not far from me in Virginia. At the time I was "suppose" to move back to Florida where my only child lives. She hated Virginia, I luv it. Lol, she luvs Florida, I hate it.

COVID arrived. Prices in Florida became ridiculous.  😱

Virginia where I am is 3 times CHEAPER than the CHEAPEST place in Florida.

But I know IF and when I cannot drive or live alone I MAY have to return to Florida IF she is still there.

I keep hoping she will return to Virginia as she has been laid off (along with hundreds) from her engineering job at Harris L3 since 4/11/24. Doing seasonal work as she seeks another position.

So, I am kind of NOT committing to either Virginia or Florida.

But you are correct - stuff has to be paid.

Again thanks for this topic and advice.

Nicole

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[*** GAKKIEZ wrote: Even with cremation you have to find a way to pay for it and how to inter/dispose of the ashes. ***]

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[GAKKIEZ]

  You can check pre-paid burial/cremation to see if it includes return of remains to your home location.  This would cover it IF you pass away while traveling.

[Winter2025VA]

Thanks @GAKKIEZ  👍

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[*** GAKKIEZ wrote: You can check pre-paid burial/cremation to see if it includes return of remains to your home location.  This would cover it IF you pass away while traveling. ***]

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[GailL1]

Cremation can be economical or expensive - because it just depends on what you want and where you want to be put afterwards.  

The Neptune Society has been around a very long time and they specialize in cremation- preplanning but they are also a good source of info on it. 

[Winter2025VA]

Thanks Gail @GailL1 . Just a simple cremation and my ashes spread here in the Virginia mountains. I will check them out.

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[*** GAIL wrote: Cremation can be economical or expensive - because it just depends on what you want and where you want to be put afterwards.  

The Neptune Society has been around a very long time and they specialize in cremation- preplanning but they are also a good source of info on it. ***]

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