Helpful Links for Preplanning and Prefunding a Funeral

Preplanning and prefunding a funeral are two of the best ways to take the stress out of making arrangements when a family member or friend dies.

By preplanning a funeral, you are taking the guesswork out of what someone wants in the way of services and disposition of the decedent. Is a traditional, religious service desired or a more contemporary celebration of life? Should the decedent be cremated or buried?

These are questions that can be answered during the preplanning process, and there are avenues for setting aside money for funeral-related expenses as well. One of the most advantageous for consumers is Funeral Planning CHOICES, a federally insured trust fund that allows those preplanning funerals to set aside funds in an interest-bearing account that is fully refundable.

The New Jersey State Funeral Directors Association’s website contains information to help you through the process of both preplanning and prefunding and explains the advantages of both. Here are some links to get you started:

Preplanning Your Funeral. This section takes you through the basics of preplanning, covering the initial meeting with a funeral director, the benefits of preplanning and the documents that will be presented to you when you discuss prearrangements with a funeral director.

The section also explains that when you preplan you are not “locking in” to a particular set of arrangements. Whatever you decide can be changed when the intended funeral recipient dies.

Prepaying Your Funeral. This section provides descriptions of the three ways consumers can prepay for funeral arrangements. Information is given concerning establishing a prepaid funeral trust fund account, assigning an existing life insurance policy to the funeral home and purchasing funeral insurance or an annuity.

Prepaid Agreements. This page gives brief descriptions of irrevocable and revocable prepaid agreements. Irrevocable arrangements are made only when the intended funeral recipient is establishing eligibility for SSI/Medicaid benefits or other means-based public assistance. There are also links to sample agreements. What happens with any excess funds after a funeral is paid for is also addressed.

SSI/Medicaid. The circumstances under which an irrevocable funeral prearrangement is allowed are described in this section. Persons who may be going on SSI/Medicaid within the next six months are eligible to establish irrevocable arrangements as part of the application process.

Funeral Planning CHOICES. This page introduces the New Jersey Prepaid Funeral Trust Fund, known to consumers as Funeral Planning CHOICES. This trust fund gives those preplanning funerals the option of opening an account where money can be set aside for future funeral costs. When funds are deposited into an FDIC-insured CHOICES account, the money earns interest at competitive rates. If the account is opened as revocable, the money can be withdrawn at any time.

Funeral Matters. Funeral Matters is a pricing tool that allows consumers to choose their funeral preferences online, price their options and then pick a funeral home to send their choices to. The build-and-price tool includes options for preplanning a funeral and whether the funeral would be funded with an irrevocable or revocable agreement.

Preplanning Brochures. Several helpful brochures, all of which can be downloaded and printed out, are available on this page. The brochures describe Funeral Planning CHOICES and irrevocable prepaid agreements. They are available in both English and Spanish. Sample trust agreements are also linked on this page.

Here are several other links to information you may find helpful: