If you’re thinking of planning ahead, there are two main types of funeral preplanning that involve a funeral director; Pre-Paid and Pre-Arranged. Both types of pre-planning alleviate the additional burden on your family, that is making funeral arrangements in a time of grief. Pre-paid funerals are preferred by most families, as prices are protected against inflation.

A pre-paid funeral involves planning the funeral in full with your funeral director of choice. The funeral director will quote the funeral in full, in today’s prices. The funeral is then paid for up-front or using a payment plan.

With your funeral director, you select the service type, coffin or casket, floral arrangements, hearse, music, readings, the leader of the service and the role of attendees. The cost of the funeral is then fixed, irrespective of future price changes. The funds are not held by the funeral director, but instead in a trust independent of the funeral director. The funds can only be accessed by the funeral director upon completion of the funeral service in the future.

This type of preplanning ensures your family need not worry about making funeral arrangements or finding the funds at a time when they are most vulnerable. Pre-Paid funerals are not an asset subject to income testing with regards to pension entitlements.