NFDA Home > Planning a Funeral > Preplanning
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Ways to Pre-pay

There are several methods available to pre-pay for a funeral:

  • A regulated trust can be established by a licensed funeral director.

  • A life-insurance policy can be purchased, equal to the value of the funeral.

  • Individuals can establish a savings or certificate of deposit account earmarked for funeral expenses. The account can be designated as “payable on death” (POD) to the funeral home.

Each method has its advantages. To help determine which option is best for you, make sure to ask your funeral director the following questions:

    • Who receives the interest on the account?

  • Who must pay taxes on the interest?

  • Is the prepayment ever refundable, in part or in full?

  • Can the plan be used at a funeral home of your choice?

  • What happens if the funeral home goes out of business or is sold?

  • In the event that you move, is the prefunded plan transferable?

For additional information on prepaying see NFDA’s Bill of Rights for Funeral Preplanning and Tips on Prepaying for a Funeral