Serious question. Anyone here buy "final expense" insurance?

[Tallbald]

As a 55 year old man with several health problems, and not wanting to burden my family "when the time comes" , I'm considering "final expense insurance" to cover cremation, the $150 cardboard box I'll be cremated in (honestly that's what it cost my Mom in 2008), and that sort of thing. I guess I need to watch more late night TV and get the phone number of some of these outfits. Are there so many exclusions they aren't worth the trouble? Don

 

[frank n texas]

Check you local funeral homes for a pre cremation package price...
Runs about $1,000 here in the Houston area...

 

[Pierow]

I know those kinds of packages are convenient Frank but there are some drawbacks to giving a funeral home your money. Funeral homes do go out of business and so goes your money. Another drawback is whatever monies you do give to a funeral home they most always make your heirs spend it all, sometimes more. The money you give to funeral homes is not protected whereas there are plans out there which are portable, protected, irrevocable, protected against a medicaid spend-down scenario and they earn interest.

Tallbald, it has been some time since I looked into these kinds of policies but if you like I can do some research and give you a couple companies to comparison shop. I'll need until Monday to do so.

Pierow

 

[Kevin]

I'm not anywhere close to your situation but why not either give money each month to a trusted relative for such expenses or literally stuff it in your mattress. I'm speaking of cash, not a savings account which would get tangled up in any estate tax or whatever. At 150 for a cardboard box or 1000 for a cremation in Houston, you aren't talking about a great deal of money.

 

[Selena]

I know those kinds of packages are convenient Frank but there are some drawbacks to giving a funeral home your money. Funeral homes do go out of business and so goes your money. Another drawback is whatever monies you do give to a funeral home they most always make your heirs spend it all, sometimes more. The money you give to funeral homes is not protected whereas there are plans out there which are portable, protected, irrevocable, protected against a medicaid spend-down scenario and they earn interest.

Tallbald, it has been some time since I looked into these kinds of policies but if you like I can do some research and give you a couple companies to comparison shop. I'll need until Monday to do so.

Pierow

Actually there are packages sold where the seller is the "primary." They are in reality insurance policies that pay out to whoever provides the service. The main danger isn't from the funeral home going out of business as much as having the funeral director find himself in financial distress and list you as deceased to collect the benefits. A few years after my Gramps died Dad tried to put Grams on his insurance carrier. He was visited by an irate insurance guy who informed him that Grams was dead and the company took a dim view of fraud. After a trip to town where the guy met the deceased and talked with her at length over the details of her death he was finally convince she was actually alive.

It turned out that the funeral director had a gambling problem and "killed" off a number of elderly, collected the insurance early and in four cases buried them in one case over a year after they 'died.' It is something you might want to consider if you go that particular route. On the bright side every holiday with Grams here is a Día de Muertos.

 

[RSIno1]

Neptune Society. Not sure if they are in your area. The inlaws used them. I think it was around 700 for pre paid.

 

[exavid]

Neptune Society is a good one, the one in the link below is also supposed to be reasonable. When my parents passed they didn't want any services and I had them cremated according to their wishes with a low cost cremation service. I believe it was around $600 for each of them. I wouldn't pay ahead for anything like that there are a lot of places you can check out for low cost cremation that will accept payment at time of service.

http://www.lowcostcremation.com/

 

[mishtub]

There is something called an "Irrevocable Funeral Trust" that may be viable.
http://www.funeraltrusts.com/questions.cfm

 

[exavid]

The drawback to any kind of irrevocable trust is that you most likely can't get your money out of it if a serious need comes up.

 

[gramps]

Put your money in a savings account. I have seen too many places go under with devastating results to the living!
gramps

 

[Bull Barrel]

Like banks...

 

[Selena]

Put your money in a savings account. I have seen too many places go under with devastating results to the living!
gramps

If you are going to go the savings account route be sure to make it a joint account with right to survivorship. Otherwise the account would become part of the estate and not available until the will is settled.

 

[Pierow]

If you are going to go the savings account route be sure to make it a joint account with right to survivorship. Otherwise the account would become part of the estate and not available until the will is settled.

This thread has officially scared the crap out of me. Boy am I careful when it comes to making financial/estate planning recommendations to my clients and when I do, I let them know all the angles especially what bad things might happen. Using joint accounts with rights of survivorship between husband and wife for estate planning is one thing. Using the same accounts with anyone else and you have just placed your estate at unnecessary risk. Follow this advice Tallbabld and you could lose your entire savings account.

My apologies Selena but your statement if followed could do much damage. If Tallbald places anyone else other than a spouse as joint owner on an account, Tallbald then also accepts all the other's risks so if they get sued, Tallbald's savings account becomes 100% available for that lawsuit to seek damages against.

Pierow

 

[Selena]

If you are going to go the savings account route be sure to make it a joint account with right to survivorship. Otherwise the account would become part of the estate and not available until the will is settled.

This thread has officially scared the crap out of me. Boy am I careful when it comes to making financial/estate planning recommendations to my clients and when I do, I let them know all the angles especially what bad things might happen. Using joint accounts with rights of survivorship between husband and wife for estate planning is one thing. Using the same accounts with anyone else and you have just placed your estate at unnecessary risk. Follow this advice Tallbabld and you could lose your entire savings account.

My apologies Selena but your statement if followed could do much damage. If Tallbald places anyone else other than a spouse as joint owner on an account, Tallbald then also accepts all the other's risks so if they get sued, Tallbald's savings account becomes 100% available for that lawsuit to seek damages against.

Pierow

You are quite right to point that out. Mea culpa.

 

[Pierow]

Don,

Reading your post it is obvious that you want to relieve your family of any burdens when you pass. Good for you and to do that you need more than the money to bury you. The real burden you would place on your survivors is not financial but emotional. In the business of estate planning death is easier than incapacity. Death entails no decision making whereas if you are incapacitated, someone needs to step in and not make decisions for you, but to follow the instructions you left them in your living will / health care power of attorney.

With these two documents, if you don't have them already, you are able to tell your family that if you are on life support and based on the doctors prognosis you are in a vegetative state and are alive solely based on machinery, you wish life support to be removed and allow you to die peacefully. With the same documents you can state the opposite, meaning you wish to remain on life support no matter what the prognosis is. The bottom line is that you have now relieved your loved ones from having to decide on their own whether to end your life or not. That is the true burden you or anyone else without these documents places on your survivors. No one wants to burden our loved ones with such a decision so please get these documents in order along with a power of attorney for financials. The p.o.a.'s need to be durable of course.

You stated, "Are there so many exclusions they aren't worth the trouble?" It depends on what kind of policy and coverage you are looking for. There are policies out there which are guaranteed issue meaning no underwriting. That also means those policies will be the most expensive as compared to an underwritten policy or a simplified issue whereby they do the medical check and or a set of questions. To give you an idea for 5,000.00 of coverage at age 55 your premium will be about 83.20/thousand or 416.00 per year. If you pass during the first three years your estate will receive a refund of all premiums paid plus 6,12 or 18 percent interest depending on which year you pass. If you were healthier your premiums would be approximately half with the same death benefit. From what you have stated it seems the 5,000.00 minimum face amount might be too much for your needs. There may be other policies out there with a smaller face amount but usually 5,000.00 is the minimum.

United Home Life and United Farm Family are the companies I pulled these numbers from. You might be surprised to find out that from an insurance standpoint you might be more insurable than you think. An agent could help you determine which policy gives you the most coverage per dollar of premium. Just a couple of companies to check out if you decide to go forward but be sure to get your foundation in place first by getting your legal documents in order.

Best, Pierow

 

[mohavesam]

First, make sure (that means "GET IT IN CONTRACT FORM") that your chosen funeral home endorses and will accept the coverage of your choice.
Second, JUST DO IT! Every decision you leave to a family member will sour their memory of your competence.
Third, JUST DO IT! Get it in place today, you can always change it in a month or so if/when situations change.

 

[Xsales]

Usually the final expense INS plans seem to carry a low limit payment to cost ratio

I see a better choice of higher limit whole life type life ins policy & have money set a side for your final costs

Many funeral homes will wait for the payout of a life ins policy IF they can see you have a policy and write them in for their cut from said policy - sort of like a rider or lien

 

[Mobuck]

I've been "selling" my paid up life insurance policies because I don't intend to leave any more on the table for Grouch Attack than absolutely necessary.
A local funeral director was prosecuted a few years ago for mishandling funds paid for future funeral expenses. I know some folks who "pre-paid" funerals several years ago. I can virtually guarantee the costs have increased more than the interest on that money has added to the "pre-pay" so I'm not sure how that's going to pan out.

 

[ronto]

I pre-arrange NOT pre-pay. Funeral costs in most States are high on the priority list of expenses to be paid and most funeral homes will wait for the estate to settle. Just be sure you have a will that specifies your final wishes and you have enough cash in the bank (in your name only) to cover them. If you have untrustworthy relatives, name the trust department of a local bank as executor of your estate.

 

[finesse_r]

My parents both had burial insurance and had their plots all paid for and the plans fully made. It certainly was a relief to us kids, not to have to make all those plans when they did die. My Dad went last and it was unexpected and none of us were in emotional condition to be dealing with funeral home personnel or shopping for coffins. It is a very mature and thoughful thing to do.

 

[opos]

My happiest day was when I got too old for AARP..they have bothered me since shortly before I turned 50 until a couple of years ago when I turned 75...seems they finally realized that I'm "off the charts" and they cut their coverage about 74 as I recall...so guess we will just have to figure what to do without some AARP salesman bugging us . My favorite is the Met life commercial where the grumpy looking daughter shows up and "Mom and Dad's house"....there is Mom all worried looking and Dad looking like he's loaded..got his arm in a sling like he fell out of his chair...certainly not in any "danger"...the daughter gasps "what happened"? She and Mom decide they need to take out final needs insurance on the old boy and strangely the daughter has the Met Life number in her purse.

He should grab the money ...hit the casino...pick up some young gal that's not so worried about "after" and is more interested in "right now"....Pitiful and sick ad...

 

[Colonialgirl]

I took out a $5K life insurance policy with the AAA; My spouse is the beneficiary (Secondary is my son in case the TWO us go at the same time; There is also a $5k on my spouse. Once I'm dead, as far as I'm concerned, just dead a hole in the back yard and dump me in; Plant something useful like a fruit tree or blackberry vines on top of me.

 

[exavid]

Neptune Society. Not sure if they are in your area. The inlaws used them. I think it was around 700 for pre paid.

My folks didn't want services so we used the Neptune Society and though it was a good deal. Also around $700 at the time about ten years ago.
My dad was very frugal and didn't want any stone or some such. When I went to pick up the cremains the mortuary wanted to sell me an Urn for $350. They said a cardboard box wasn't sufficient for some reason. I got griped about it so went home and cleaned out one of dad's old .50 ammo cans and got him remains put in the can. We kept him in the garage for about a year and a half until my mom passed and her remains went in the ammo can with his. We finally poured their remains in San Francisco Bay where they met in 1939. I don't think my career military father would have been insulted either.

 

[Colonialgirl]

My little brothers ashes got dumped in the streams and creeks around Prescott AZ that were his favorite fishing spots (secretly of course). He was know to stand in a snowstorm dangling a line in a creek.

 

[Precision32]

I told my adopted daughter where to find two, one ounce gold Maple Leafs. She is to have me cremated, put me in a douch bag, find some old whore and run me through one more time! She told her husband the plan and he just cracked up.

 

[speedsixman]

RonT,

"Just be sure you have a will that specifies your final wishes and you have enough cash in the bank (in your name only) to cover them."

There is a major pitfall scenario with money in any bank account. If the person depletes their money and needs to be on MEDICAID for extended care, any money in any account wills be sucked up BEFORE Madicaid wisll pay anything, and there will be nothing left for funeral expenses.

We got a pre-paid funeral for my mom and that was exempt from any Medicaid claims.

Plan carefully, and explore the legalities and liabilities of any plan you choose.

Myron

 

[Pat-inCO]

I use a variation on several of the above.

A letter in my safety deposit box with my wishes very explicitly stated,
and some cash. Only the people who should, will have access to it, and
then they will know what/how and OBTW, here's the cash to do it.

I told my daughter know about it. While it will cost her out front,
there is more money in the envelope than it will cost her.

For any that say "WHAT ABOUT THE INTEREST ON THE MONEY?"
That's not enough to pay someone else to administer it for me. :roll:

 

[speedsixman]

-TitanX,

You are correct that any accounts are frozen upon death.
Even a Power of Attorney becomes null and void at that point, and it kicks over to Probate and any Will if present.

Joint accounts that list the spouse as Mary OR Harry should still be accessible to the survivor, but an account that is listed as Mary AND harry will be locked.

Anyone have further information on this ?

Myron

 

[Colonialgirl]

-TitanX,

You are correct that any accounts are frozen upon death.
Even a Power of Attorney becomes null and void at that point, and it kicks over to Probate and any Will if present.

Joint accounts that list the spouse as Mary OR Harry should still be accessible to the survivor, but an account that is listed as Mary AND harry will be locked.

Anyone have further information on this ?

Myron

That's the way my Mom's savings accounts and safety deposit were set up with my big brother; They were
Leona OR Jim Dunn; when she passed he and I went to the bank to take care of matters and had no problems. I trusted my brother completely, he and I have always been close, thanks to life as Navy brats; matter of fact he was MORE than fair with me on the inheritance.
Love my brother Jimmy !!

 

[Pat-inCO]

My understanding and experience is that banks will freeze all activity once a person dies.

I didn't have ANY problems when my mother died. :roll: