Protecting Your Loved Ones From Unnecessarily High Funeral Expenses

By Rick Law, Senior Advocate and Estate Planning Attorney of Law Elder Law in Aurora, IL.

A family friend once told me about the trouble he was having with his mother-in-law’s funeral and subsequent burial expenses. Though the couple had long ago purchased a burial plot, and the husband had been laid to rest there years earlier, the mother-in-law had been personally and financially drained by the whole process.

When a family experiences the loss of a loved one, the worst thing that can happen is to be burdened by unforeseen costs and red tape that went unprepared for. I know that most of my clients want their family to have the easiest transition possible when they pass away, and remove any additional burdens that they possibly can from their surviving spouse and/or children.

The couple I mentioned above had been a typical, frugal couple, and had planned accordingly.

Very often, people have traditional life insurance policies that they are planning to use to provide funds for their funeral.

Some clients will even tell us that they have a small savings account that they have set aside for funeral expenses. So what happens if an unforeseen illness causes almost all of your savings to be spent on your care?

At least 75% of seniors living today will spend at least some time in a nursing home. At $5,000-$9,000 per month, how long would your savings last?

Unfortunately, Medicaid does not allow for either a savings or traditional life insurance policies, unless they’re valued at no more than $1,500. The problem with the traditional life insurance is that it has “cash value” and therefore, Medicaid would require that it be cashed in and spent on care.

You can, however, have a prepaid funeral plan at a local funeral home or a prepaid burial trust that funded by a life insurance policy. The prepaid funeral policy goes to the funeral home at the time of the person’s death and is used to cover all final expenses. If a client has a life insurance policy with a large cash value, this can be converted to a burial trust – and the money is now protected for final expenses.

Too many families needlessly lose everything they have. Don’t let that be you. If you need help paying the overwhelming cost of long term care, give our office a call at 800-310-3100. Your first consultation is absolutely free. We’ll let you know what steps you need to take, right now, to protect yourself and your family. Call now, because when you’re out of money, you’re out of options!

Sincerely,

Rick L. Law, Attorney, Estate Planner for Retirees

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