Pre Planning

With so much advertising to be seen these days about ‘funeral planning’ it’s little wonder why so many of us get a bit confused about the best option to take.

Funeral planning is a highly emotional and personal matter, and let’s not forget the financial commitment that comes with such a decision.

When planning ahead there are so many aspects to consider, and what may seem simple and cheap on the surface may in the long run prove to be very expensive option for you and your Estate.

This information provides a summary of the three main funeral options and we hopes it helps remove some of the confusion surrounding each of them.

Option One:

Funeral Insurance

As harsh as it may sound there is no doubt that funeral insurance is the best option for people who expect to pass away in a short period of time. Unfortunately research shows that after only 7 years you will pay more in premiums than the actual cost of your funeral.

When considering funeral insurance the main points to remember are:

  You must continue to make monthly payments generally up to age 90;

  Failure to make one monthly payment and the Insurance Underwriter can cancel your insurance;

  You receive nothing back if you stop making payments or if your policy is cancelled;

  There are no pension advantages;

  You have limited cover in the first year – accidental cover only;

  You cannot select your preferred funeral director;

  You cannot specify what you want in your funeral;

  You cannot guarantee that your insurance claim payment will even be used to meet your funeral expenses.

Option Two:

Funeral Bonds

A funeral bond is a capital guaranteed investment whose specific purpose is to meet future funeral expenses. When considering a funeral bond the main points to remember are:

  It is a secure investment in your name;

  It helps relieve the stress and the financial burden of funeral expenses;

  You can invest up to $13,250 (indexed annually);

  The bond grows in value as it enjoys annual bonuses;

  Monies invested are not deemed part of your assets nor bonus payments part of your income for pension purposes;

  You can invest as little as $25 per month when making regular contributions;

  You can stop making payments at any time and the money is still there in your name;