Planning out your later years is what the majority of estate planning focuses on. This includes powers of attorney, medical arrangements and trusts to help protect your assets after your death. However, trusts that help pay for your death are useful as well.
Having your funeral paid for in advance may help your family navigate their feelings of grief and loss by removing that financial concern.
Preneed contracts and funeral trusts
As Funeralwise.com details, there are a few options to help pay for your funeral and plenty of consideration to give to each.
A funeral trust is an arrangement you make with a cemetery or funeral home. By arranging a preneed contract that details your funeral services, a funeral home may have you set up a funeral trust to finance it.
Totten trusts, or payable on death accounts, are another option that you arrange with your bank. This money shifts to a beneficiary of your choice upon your death.
Revocable and irrevocable trusts
A major detail to consider is whether your trust still lets you access any funds you put in. Revocable trusts have the advantage of remaining accessible if you need the money in an emergency. However, when considering benefits like Medicaid, revocable trusts often count as your asset. Irrevocable trusts are a lot harder to access but do not count as an asset for those purposes.
No matter what agreement you make, it is important to communicate with your family. You may lean on other resources to make sure that any contract you sign expresses your wishes in a way that suits your situation.