Comments on: The Prepaid Funeral: Advantages & Disadvantages http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm Building Wealth through Saving and Investing Sun, 12 Feb 2012 23:42:26 -0330 http://wordpress.org/?v=abc hourly 1 By: Charlie http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-120831 Charlie Sat, 02 Jul 2011 15:44:58 +0000 http://www.milliondollarjourney.com/?p=900#comment-120831 I think the biggest bonus of a prepaid funeral is the guarantee of the cost of services that most funeral homes offer as a standard to their client families. I have seen what my TFSA has done for 7 years and I also see what a funeral has increased by over the past 10 years. I think I'm happy with the prepaid funeral decision. I also have to express my pleasure with someone finally pointing out that the CPP death benefit isn't automatic the one thing I would have mentioned is that when a couple is splitting CPP credits because the one spouse is getting very little doesn't mean that the spouse who was being increased is going to get more of a death benefit. Did you know what cost of a funeral will roughly double every 10 years so if you can afford it you should be starting a plan with your funeral home most offer programs that allow you X number of years to pay for the funeral with the added benefit that should you die before the balance is paid you or your family isn't responsible for any difference between deposits paid and the total funeral cost. i would also take the thought above a little further... tomorrow go into Future Shop and tell the associate that you need a new TV but you don't need it for 25 years but you will give them todays price and pick it up in 25 years and see what they say. when the local funeral home is encouraging you to do what i just suggested and a lot of people don't think for some reason it is worth it to do. I think the biggest bonus of a prepaid funeral is the guarantee of the cost of services that most funeral homes offer as a standard to their client families. I have seen what my TFSA has done for 7 years and I also see what a funeral has increased by over the past 10 years. I think I’m happy with the prepaid funeral decision. I also have to express my pleasure with someone finally pointing out that the CPP death benefit isn’t automatic the one thing I would have mentioned is that when a couple is splitting CPP credits because the one spouse is getting very little doesn’t mean that the spouse who was being increased is going to get more of a death benefit.
Did you know what cost of a funeral will roughly double every 10 years so if you can afford it you should be starting a plan with your funeral home most offer programs that allow you X number of years to pay for the funeral with the added benefit that should you die before the balance is paid you or your family isn’t responsible for any difference between deposits paid and the total funeral cost.
i would also take the thought above a little further… tomorrow go into Future Shop and tell the associate that you need a new TV but you don’t need it for 25 years but you will give them todays price and pick it up in 25 years and see what they say. when the local funeral home is encouraging you to do what i just suggested and a lot of people don’t think for some reason it is worth it to do.

]]> By: Daniel Wybo http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-114794 Daniel Wybo Wed, 18 Aug 2010 01:56:14 +0000 http://www.milliondollarjourney.com/?p=900#comment-114794 Re: Bill Sheilds is correct so BEWARE in regards to the CPP Death Benefit: It is my understanding that the CPP Death Benefit maximum is based on a multiple of 6. In other words if the CPP recipient receives only a $100 a month in income, their death benefit will only be $600 ( 6x$100=$600.Death Benefit $200 a month x6 = $1200 Death Benefit $300 a month x6= $1800 Death Benefit $400 a month x6=$2400 Death Benefit $416.66 a month x6= $2500 Max Therefore its possible to calculate the actual amount of death benefit based on whether you get more than $416.66 per month on CPP. If you get more than $416.66 per month you qualify for the maximum Death Benefit of $2500. If you get less than $416.66 per month you qualify for the Death Benefit however it will only be a multiple of 6 times your actual CPP income benefit. People who don't get any CPP will not be eligible for the Death Benefit. There is a lot of misinformation and one should consult SERVICE CANADA for clarification. One thing is for sure , the CPP Death Benefit will not be even close enough to pay for ones final expenses. A preneed supplemental plan , like the one offered by The Canada Purple Shield will cover those expenses not paid by CPP Death Benefit. The Purple Shield Plan is low cost and offers $1000 to $15000. The plan grows tax free and is accepted by Funeral Homes throughout Canada . Re: Bill Sheilds is correct so BEWARE in regards to the CPP Death Benefit:

It is my understanding that the CPP Death Benefit maximum is based on a multiple of 6.

In other words if the CPP recipient receives only a $100 a month in income, their death benefit will only be $600 ( 6x$100=$600.Death Benefit
$200 a month x6 = $1200 Death Benefit
$300 a month x6= $1800 Death Benefit
$400 a month x6=$2400 Death Benefit
$416.66 a month x6= $2500 Max

Therefore its possible to calculate the actual amount of death benefit based on whether you get more than $416.66 per month on CPP.
If you get more than $416.66 per month you qualify for the maximum Death Benefit of $2500.
If you get less than $416.66 per month you qualify for the Death Benefit however it will only be a multiple of 6 times your actual CPP income benefit.
People who don’t get any CPP will not be eligible for the Death Benefit.
There is a lot of misinformation and one should consult SERVICE CANADA for clarification.

One thing is for sure , the CPP Death Benefit will not be even close enough to pay for ones final expenses.
A preneed supplemental plan , like the one offered by The Canada Purple Shield will cover those expenses not paid by CPP Death Benefit.
The Purple Shield Plan is low cost and offers $1000 to $15000. The plan grows tax free and is accepted by Funeral Homes throughout Canada .

]]> By: Camille http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-114789 Camille Tue, 17 Aug 2010 20:31:44 +0000 http://www.milliondollarjourney.com/?p=900#comment-114789 Re: Bill Sheilds is correct so BEWARE in regards to the CPP Death Benefit: The deceased had to contribute into the fund for 11 years MINIMUM( I have seen people declined who missed the mark by one week or even a few days as the law is the law). So, for example those who were stay at home Mom's will not qualify if they did not contribute to CPP for 11 years and again 2500 is the max; Odds are you will probably receive alot less.Therefore, you cannot depend on CPP Death Benefit.Plus, being that it will take 8 to 10 weeks to receive anything youor your family will need to pay the funeral home as they will not wait 8 to 10 weeks for payment. After all you don't go to McDonalds order a meal and tell them you will pay them 8 to 10 weeks from now. Shockingly, they don't go for that. Re: Bill Sheilds is correct so BEWARE in regards to the CPP Death Benefit:

The deceased had to contribute into the fund for 11 years MINIMUM( I have seen people declined who missed the mark by one week or even a few days as the law is the law). So, for example those who were stay at home Mom’s will not qualify if they did not contribute to CPP for 11 years and again 2500 is the max; Odds are you will probably receive alot less.Therefore, you cannot depend on CPP Death Benefit.Plus, being that it will take 8 to 10 weeks to receive anything youor your family will need to pay the funeral home as they will not wait 8 to 10 weeks for payment. After all you don’t go to McDonalds order a meal and tell them you will pay them 8 to 10 weeks from now. Shockingly, they don’t go for that.

]]> By: Bill Shields http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-114172 Bill Shields Wed, 14 Jul 2010 00:42:56 +0000 http://www.milliondollarjourney.com/?p=900#comment-114172 Second Note to all readers re: CPP Death Benefit The lump sum death benefit from CPP is only available to someone who has contributed to CPP and is based on their contributions through their working life, not to everyone as many expect it to be. The maximum benefit is $2500. The eligable person may receive a benefit UP TO $2500 The benefit is payable to the Estate of the person who has passed away and contributed. With the benefit being paid to the estate is therefore a taxable income to the estate, therefore, the full benefit is seldom realized. The time of return is approx. 8 - 10 weeks on average from time of placing the application. Bill Shields Second Note to all readers re: CPP Death Benefit

The lump sum death benefit from CPP is only available to someone who has contributed to CPP and is based on their contributions through their working life, not to everyone as many expect it to be. The maximum benefit is $2500. The eligable person may receive a benefit UP TO $2500 The benefit is payable to the Estate of the person who has passed away and contributed. With the benefit being paid to the estate is therefore a taxable income to the estate, therefore, the full benefit is seldom realized. The time of return is approx. 8 – 10 weeks on average from time of placing the application.

Bill Shields

]]> By: Bill Shields http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-114170 Bill Shields Tue, 13 Jul 2010 22:37:40 +0000 http://www.milliondollarjourney.com/?p=900#comment-114170 Hello Kathryn: i appreciate most of your blog on prepaid funeral issues. You have made some good points and have addressed several of the key issues. I have been a funeral director for over 20 years, taking 2 of those years to work in the investment and insurance industry. It does bother me that one again, as I repeatedly witnessesd in my two year stint, the investment advisors are NOT completely arware of the products and benefits available. I liked how you have encouraged people to make sure they are dealing with the right people and companies, but your advice on the TFSA I feel is poor at best, and if the right preplanned product was used, the TFSA would NOT be a better choice for several reasons, too difficult to answer in this small spot. I can tell you in the almost 25 years of my career, the preplanning process has never hurt anyone...that is a pretty good track record and reason to consider it. Thank you for your input and for the opportunity to comment. I am pleased to see you are becoming more "preplanning friendly." Bill Shields Hello Kathryn: i appreciate most of your blog on prepaid funeral issues. You have made some good points and have addressed several of the key issues. I have been a funeral director for over 20 years, taking 2 of those years to work in the investment and insurance industry. It does bother me that one again, as I repeatedly witnessesd in my two year stint, the investment advisors are NOT completely arware of the products and benefits available. I liked how you have encouraged people to make sure they are dealing with the right people and companies, but your advice on the TFSA I feel is poor at best, and if the right preplanned product was used, the TFSA would NOT be a better choice for several reasons, too difficult to answer in this small spot. I can tell you in the almost 25 years of my career, the preplanning process has never hurt anyone…that is a pretty good track record and reason to consider it. Thank you for your input and for the opportunity to comment. I am pleased to see you are becoming more “preplanning friendly.” Bill Shields

]]> By: DW http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-112335 DW Thu, 15 Apr 2010 17:52:51 +0000 http://www.milliondollarjourney.com/?p=900#comment-112335 bought a life policy from assumption life called golden protection plus it pays 3% a year on amount insured, this is better than the TFSA because it grows on a principal I did not have to provide. When death occurs it pays out the principal amount insured plus the 3% for every year it was in force tax free. I have not seen a better one than this, especially since its what they call imeadiate issue with no medical. The one's you see on tv make you wait 24 months before you can get the full amount. bought a life policy from assumption life called golden protection plus
it pays 3% a year on amount insured, this is better than the TFSA because it grows on a principal I did not have to provide.
When death occurs it pays out the principal amount insured plus the 3% for every year it was in force tax free.
I have not seen a better one than this, especially since its what they call imeadiate issue with no medical. The one’s you see on tv make you wait 24 months before you can get the full amount.

]]> By: Rick http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-110275 Rick Tue, 02 Feb 2010 14:20:35 +0000 http://www.milliondollarjourney.com/?p=900#comment-110275 In my case my parents are both over 80. The impact of the HST which is effective July 1/10 adds several hundred dollars in cost to even the most modest funeral. I am considering whether to beat Dalton out of a few bucks because the return in my situation is pretty good. Not sure if its true but the guy on CBC recently stated that an "average $5,000 funeral" will get an $800 wack courtesy of Dalton and the HST. In my case my parents are both over 80. The impact of the HST which is effective July 1/10 adds several hundred dollars in cost to even the most modest funeral. I am considering whether to beat Dalton out of a few bucks because the return in my situation is pretty good.

Not sure if its true but the guy on CBC recently stated that an “average $5,000 funeral” will get an $800 wack courtesy of Dalton and the HST.

]]> By: Sara http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-110213 Sara Mon, 01 Feb 2010 03:16:07 +0000 http://www.milliondollarjourney.com/?p=900#comment-110213 Donating your whole body to science is a NO cost, pre-plan option, that takes all the stress and cost out of making arrangements following a death. The companies that offer this also encourage a 'pre-death donation' agreement. Another benefit is the 'eco' agenda - as with body donation (to Science) you are actually giving a gift back to humanity. Although I believe this is only available in the US at present and not Canada. Donating your whole body to science is a NO cost, pre-plan option, that takes all the stress and cost out of making arrangements following a death. The companies that offer this also encourage a ‘pre-death donation’ agreement. Another benefit is the ‘eco’ agenda – as with body donation (to Science) you are actually giving a gift back to humanity.

Although I believe this is only available in the US at present and not Canada.

]]> By: Kathryn http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-88929 Kathryn Thu, 25 Jun 2009 01:35:54 +0000 http://www.milliondollarjourney.com/?p=900#comment-88929 I have to agree with you Ian. It's the most common thing I've heard from families that have dealt with prepaid funerals. The decisions are easy and guilt free with they've already been made. The money saved from 'up-selling' during an emotionally fraught time may well be worth the other costs lost. I have to agree with you Ian. It’s the most common thing I’ve heard from families that have dealt with prepaid funerals. The decisions are easy and guilt free with they’ve already been made. The money saved from ‘up-selling’ during an emotionally fraught time may well be worth the other costs lost.

]]> By: ian calderwood http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-88922 ian calderwood Thu, 25 Jun 2009 00:00:29 +0000 http://www.milliondollarjourney.com/?p=900#comment-88922 I recently went thru the process of arranging a funeral that had a prepaid service, cremation, etc. There is another side to prepaid funerals that one should not overlook. In my case, the deceased was very specific-low cost with as many assets as possible going to the estate. The process was interesting. The funeral director walked me thru the sales room to view caskets. I declined, thinking very much that the deceased had selected carefully-budget was not the issue. Next, it was a conversation about a very expensive urn. No sale. Pre-arrangement took all the the 'potential guilt' and pressure away from me for selecting the options that I did-essentially the thank you card, minister, etc. Looking back, it was a snap, I was out of there in 30 minutes. We have decided to do this for ourselves-notwithstanding the ROR on our money because ultimately we believe it will save our estate upsells/money at 'that' time and the emotional pressure of starting from the beginning of the process as it were. I recently went thru the process of arranging a funeral that had a prepaid service, cremation, etc. There is another side to prepaid funerals that one should not overlook. In my case, the deceased was very specific-low cost with as many assets as possible going to the estate. The process was interesting. The funeral director walked me thru the sales room to view caskets. I declined, thinking very much that the deceased had selected carefully-budget was not the issue. Next, it was a conversation about a very expensive urn. No sale. Pre-arrangement took all the the ‘potential guilt’ and pressure away from me for selecting the options that I did-essentially the thank you card, minister, etc. Looking back, it was a snap, I was out of there in 30 minutes. We have decided to do this for ourselves-notwithstanding the ROR on our money because ultimately we believe it will save our estate upsells/money at ‘that’ time and the emotional pressure of starting from the beginning of the process as it were.

]]> By: cannon_fodder http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-87040 cannon_fodder Sat, 13 Jun 2009 12:19:19 +0000 http://www.milliondollarjourney.com/?p=900#comment-87040 Charles, Thanks for the link. Quite illuminating. Another example of what happens when the government is lax how too many people will let greed take over and prey on others. Charles,

Thanks for the link. Quite illuminating. Another example of what happens when the government is lax how too many people will let greed take over and prey on others.

]]> By: Charles Pedley http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86998 Charles Pedley Sat, 13 Jun 2009 04:34:26 +0000 http://www.milliondollarjourney.com/?p=900#comment-86998 There is a clause in any prepaid funeral that I am aware of that says in legalese terms to make it confusing that the funeral home may increase the fee cost at the time of the funeral if not enough money in the plan to provide for the requested funeral. That leaves it so open-ended that it is NO gift to your family because your family may be stuck paying the extra. Much smarter is to get a term life insurance policy when you are young enough that will bury you when you die. Consumer reports has researched pre-paid funerals and are dead-set against them because of many drawbacks like the one I described. If you are too old to afford a term life insurance policy to provide death benefits, then buy an escalator GIC which will give you more money if kept to 3, 5 or 7 years and give orders to keep rolling it over into another one to keep it growing. IN your will, you designate that GIC or whatever to cover funeral costs. Amazon.com has some books about the horrendous troubles people have ended up with due to prepaid funerals. I would not touch one with a ten-foot pole [or even a ten foot Canadian! (:-) Here the AARP, similar to our CARP warns against prepaid as a scam. http://www.aarpmagazine.org/money/funeral_rip_off.html There is a clause in any prepaid funeral that I am aware of that says in legalese terms to make it confusing that the funeral home may increase the fee cost at the time of the funeral if not enough money in the plan to provide for the requested funeral. That leaves it so open-ended that it is NO gift to your family because your family may be stuck paying the extra.

Much smarter is to get a term life insurance policy when you are young enough that will bury you when you die.

Consumer reports has researched pre-paid funerals and are dead-set against them because of many drawbacks like the one I described.

If you are too old to afford a term life insurance policy to provide death benefits, then buy an escalator GIC which will give you more money if kept to 3, 5 or 7 years and give orders to keep rolling it over into another one to keep it growing.

IN your will, you designate that GIC or whatever to cover funeral costs.

Amazon.com has some books about the horrendous troubles people have ended up with due to prepaid funerals. I would not touch one with a ten-foot pole [or even a ten foot Canadian! (:-)

Here the AARP, similar to our CARP warns against prepaid as a scam.

http://www.aarpmagazine.org/money/funeral_rip_off.html

]]> By: Madame X http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86926 Madame X Fri, 12 Jun 2009 15:44:13 +0000 http://www.milliondollarjourney.com/?p=900#comment-86926 I've been looking into this at the request of my parents. I think it's best not to pre-pay, but to leave instructions about what you want so loved ones will be able to take care of it. Also look into Funeral Consumers Alliances that exist regionally-- they survey funeral homes and provide transparency on pricing. I’ve been looking into this at the request of my parents. I think it’s best not to pre-pay, but to leave instructions about what you want so loved ones will be able to take care of it. Also look into Funeral Consumers Alliances that exist regionally– they survey funeral homes and provide transparency on pricing.

]]> By: Annuity Quotes http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86823 Annuity Quotes Thu, 11 Jun 2009 21:15:07 +0000 http://www.milliondollarjourney.com/?p=900#comment-86823 If ever you were to be on Medicaid - they will only allow so much toward funeral expenses depending on the state. It is a good idea then to have a fully funded irrevocable funeral trust then. If ever you were to be on Medicaid – they will only allow so much toward funeral expenses depending on the state. It is a good idea then to have a fully funded irrevocable funeral trust then.

]]> By: Julie http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86753 Julie Thu, 11 Jun 2009 13:41:33 +0000 http://www.milliondollarjourney.com/?p=900#comment-86753 One aspect I don't think has been touched on is that you freeze the cost of the funeral.. My mom who has chronic cancer pre-paid her funeral and it has given her tremendous peace of mind to know that arrangements are in place. One aspect I don’t think has been touched on is that you freeze the cost of the funeral.. My mom who has chronic cancer pre-paid her funeral and it has given her tremendous peace of mind to know that arrangements are in place.

]]> By: Blogging Banks http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86752 Blogging Banks Thu, 11 Jun 2009 13:34:02 +0000 http://www.milliondollarjourney.com/?p=900#comment-86752 Hmm, wouldn't it be easier simply to invest in a funeral home? With the rapid ageing of the population in the western world, investing in funeral homes sounds like a growth investment to me.. Hmm, wouldn’t it be easier simply to invest in a funeral home? With the rapid ageing of the population in the western world, investing in funeral homes sounds like a growth investment to me..

]]> By: Kathryn http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86731 Kathryn Thu, 11 Jun 2009 11:12:56 +0000 http://www.milliondollarjourney.com/?p=900#comment-86731 Tom: I agree. I would only consider this if I had a terminal illness or was over 70 and even then I might just make my wishes known to my family. MoneyEnergy: Great points on the eco-friendly funeral. I've noticed eco-friendly options are becoming more popular in the funeral industry. Jas: You're right. There is a lot of money to be made in the funeral industry or in the retirement / aging business in the next three few decades. It's not the line of work I'd want to work in but for those who would enjoy it, it would be a profitable business in the years to come. Novice: The best use of your remains! Sounds like a great way to celebrate your life. Dave: There is very little information on the prepaid funeral in Canada that isn't written by a funeral home which creates obvious bias. Lots of different demographics read MDJ. So, no, we're not even close to running out of things to write about. Tom: I agree. I would only consider this if I had a terminal illness or was over 70 and even then I might just make my wishes known to my family.

MoneyEnergy: Great points on the eco-friendly funeral. I’ve noticed eco-friendly options are becoming more popular in the funeral industry.

Jas: You’re right. There is a lot of money to be made in the funeral industry or in the retirement / aging business in the next three few decades. It’s not the line of work I’d want to work in but for those who would enjoy it, it would be a profitable business in the years to come.

Novice: The best use of your remains! Sounds like a great way to celebrate your life.

Dave: There is very little information on the prepaid funeral in Canada that isn’t written by a funeral home which creates obvious bias. Lots of different demographics read MDJ. So, no, we’re not even close to running out of things to write about.

]]> By: MoneyEnergy http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86706 MoneyEnergy Thu, 11 Jun 2009 04:39:11 +0000 http://www.milliondollarjourney.com/?p=900#comment-86706 Nice, original post - what Craig said; tough subject, but everyone will need to think about it or still be affected by it. Personally, I think about ecological things - is there even enough space on the planet to bury everyone in their own plot if we all died today? At this point I'm still on the fence about all these issues. Eventually I'll have to think some more about them, though. I know my parents have started paying for some things. I also wrote a piece about how one would/should spend any money that one's parents might leave behind in an estate. Nice, original post – what Craig said; tough subject, but everyone will need to think about it or still be affected by it. Personally, I think about ecological things – is there even enough space on the planet to bury everyone in their own plot if we all died today? At this point I’m still on the fence about all these issues. Eventually I’ll have to think some more about them, though. I know my parents have started paying for some things. I also wrote a piece about how one would/should spend any money that one’s parents might leave behind in an estate.

]]> By: Ms Save Money http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86686 Ms Save Money Thu, 11 Jun 2009 00:42:56 +0000 http://www.milliondollarjourney.com/?p=900#comment-86686 This is an interesting topic - the Funeral Industry does bank a lot of money on this and you'd be surprised. I heard somewhere that a lot of this is owned by the Church. There's a portion of the pie for you. This is an interesting topic – the Funeral Industry does bank a lot of money on this and you’d be surprised.

I heard somewhere that a lot of this is owned by the Church. There’s a portion of the pie for you.

]]> By: dave http://www.milliondollarjourney.com/the-prepaid-funeral-advantages-disadvantages.htm/comment-page-1#comment-86679 dave Wed, 10 Jun 2009 23:36:06 +0000 http://www.milliondollarjourney.com/?p=900#comment-86679 running out of things to talk about? running out of things to talk about?

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