Prepaid Cremation Services Explained: Cost, Process & Planning

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Many people want to save their family member’s time and money, even after they’re gone. If this sounds like you, then you might be considering prepaid cremation. 

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Prepaid cremation allows a person to arrange and pay for their own body disposition. It can give your family less to worry about in their time of grief and emotional loss. 

But are prepaid cremation services right for you? Find out everything you need to know about prepaid cremation, including the cost, the pros and cons, and the entire process, below. 

What’s a Prepaid Cremation?

Pre-planning and pre-paying for your own funeral, whether it’s a cremation or burial, can significantly lower your family’s stress when you pass away. However, it has to be done correctly to have that effect. 

There are also financial benefits to prepaying for cremation. A prepaid cremation can reduce the overall cost of your cremation or allow you to pay in installments over time. Some crematories and funeral homes offer a discount if you pay in advance. 

Usually, a prepaid cremation means signing a contract with a crematory or funeral home. The contract typically states the type of service you’re paying for, as well as who’s entitled to redeem the service on your behalf. 

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How Much Does Prepaid Cremation Cost?

A prepaid cremation usually costs about as much as a standard cremation. However, the cost may be lower if the company offers discounts for prepayment. 

More rural areas with lower populations also offer lower prices. If you’re prepaying for your own cremation, it’s worth taking the time to shop around for a good price. 

Below are some other factors that can affect the cost of your prepaid cremation: 

  • Direct cremation: The lowest-cost cremation option is direct cremation. A direct cremation is when a body goes directly to the crematory in the days after death. There’s no embalming and no funeral beforehand. The cost of a direct cremation is usually between $600 and $1,000. 
  • Traditional cremation: Traditional cremation is similar to traditional burial, but the body undergoes cremation rather than burial in a casket. The funeral home often embalms the body so that it can be viewed at a funeral service. The family usually rents a casket, and there are many more fees associated. Traditional cremation costs an average of about $5,000. 
  • Urn or ash box: Another consideration to take into account if you’re prepaying for cremation is what your family should do afterward. If you want your ashes to stay with a loved one, you should consider prepaying for or purchasing an urn. If you'd prefer your ashes to be scattered, there are options for that too, like this biodegradable urn. Urns and decorative ash boxes vary steeply in cost, ranging from as low as $10 to over $500. If you're looking for something more tangible, companies like Parting Stone create beautiful, handheld cremation stones to help someone grieving keep their loved one close by.

Pros and Cons of Prepaid Cremation

Prepaid cremation might seem like a no-brainer. You can save your family time and money while they’re grieving the loss of their loved one. And prepaying for cremation does have many benefits. 

However, prepaid cremation services aren’t right for everyone. In some cases, they can end up creating more stress than they help eliminate. 

Below are some of the most important pros and cons of prepaid cremation to consider.

Pros

  • Discounts. As mentioned, prepaying for cremation may or may not save you and your family money. This depends on the cremation service provider you choose, as well as the type of service you want. However, you can often negotiate a lower price on cremation by paying in advance. 
  • Avoid inflation. Paying in advance offers the benefits of investment. The cost of cremation is set to increase each year with inflation. If you pay for cremation now, and you don’t use the service for another 15 years, you’ll have saved a good bit of money. 
  • Pay in installments. Another financial benefit of prepaid cremation is that you can pay over time. The cost might be greater overall, but the financial burden upfront is lower. 
  • Stress reduction. After saving money, reducing stress is the biggest reason people choose prepaid cremation. If you’ve experienced the loss of a loved one, you might have had to arrange cremation services while you were grieving. You might want to spare your loved ones that same unpleasant task. 
  • Power of choice. Another crucial factor is that you get to decide what happens to your body after death. You can create an end-of-life plan without prepaying. But making the payment yourself ensures that your family goes with the exact service provider and options you select. 

Cons

  • Loss of agreement. The first thing that can go wrong with prepaid cremation is that you lose the agreement. There’s no guarantee that the service provider will keep a copy of your signed agreement and receipt on hand. And that means they could refuse to provide the service you paid for. 
  • Overcharging. You have to be diligent when price-shopping for prepaid cremation. Just because you’re paying ahead of time, that doesn’t mean you’ll automatically get a better price. Some cremation providers will mark up the price based on inflation or other factors.
  • Miscommunication with family members. Another common mistake with prepaid cremation is forgetting to inform your family members. It might be difficult to broach the subject of prepaid funeral arrangements with your family, but it’s important to do so. Otherwise, they won’t know which cremation provider you prepaid. 
  • Refusal to honor the agreement. The cremation provider you prepay could refuse to honor the agreement for any number of reasons. Unfortunately, there isn’t a lot your family members can do to get a refund on the money that you prepay.
  • Provider is overbooked. One example of a reason why the provider might simply refuse to honor the agreement is if they’re overbooked. If the cost of cremation has gone up since you paid, especially, they’re likely to serve higher-paying customers first. 
  • Products and services change. The services and products provided by the crematory could also change. You might have purchased a package with them that no longer exists, and there might not be a clause included for how to substitute something else. 
  • Provider goes out of business. Finally, the cremation service provider could go out of business. When this happens, it’s unlikely that you or your family will receive a notice or refund.  

How to Arrange a Prepaid Cremation

If you decide that the benefits of prepaid cremation outweigh the risks, here’s how you can get started.  

Step 1: Talk to your family members

First, discuss prepaid cremation with the family members who it will affect the most. 

Keep in mind that they’re the ones that will have to follow through with the prepaid cremation, so it’s vital to get their agreement beforehand. 

Step 2: Consider alternatives

If you want to get the benefits of prepaid cremation but avoid some of the drawbacks, you have several alternative options: 

  • Set aside cremation funds. Instead of making a payment to a cremation provider, you can create a savings account specifically for your cremation. In your will, make sure a family member can legally access the funds and use them to carry out your wishes. You may even be able to mark the account “Pay on Death” so that it automatically switches ownership. An added benefit of this method is that your account can accrue interest in the meantime.
  • Create a trust. You can also create a designated trust that can only be used for your funeral expenses. Make sure you legally set up your trust so that your beneficiary can access it quickly. They’ll need the funds to pay for your cremation sooner, rather than later. 
  • Plan but don’t pay.  Alternatively, you can create an end-of-life plan without making a payment of any kind. This route works best if you’re confident you’ll have money in your bank account at the time of your death, and your family can simply use those funds to pay your expenses. 

Step 3: Research and compare cremation providers

If you decide to prepay for your cremation with a cremation provider, do your due diligence first. There may be several cremation providers in your area, but one might have a better reputation than the rest. 

Read reviews online, and get referrals from people you know. It’s also a good idea to speak with multiple cremation providers before you decide on one. 

Step 4: Review the agreement (and make copies)

When you prepay for cremation, you and the cremation provider will both sign a contract. The contract should state the price and the services you’re paying for. 

As you look over the agreement, look out for clauses that refer to service cancelation, refunds, and anything else that might hinder your family’s ability to redeem the service. 

It’s also a good idea to make several copies of the agreement: keep one for your own records, and give a copy to one or more family members to keep on hand. 

Step 5: Create an end-of-life plan

Finally, make sure your prepaid cremation information is included in your end-of-life plan

Include the name of the cremation service provider, the service you paid for, as well as the amount you paid. You can also attach a digital scan of the agreement you signed. Once your end-of-life plan is done, make sure your family members can access it quickly and easily. 

Should You Prepay for Cremation? 

Cremation is the most popular burial alternative, and it’s one that more and more people choose every year. 

Prepaid cremation is a great way to reduce your family’s stress upon your death. However, there are quite a few things that can go wrong when you pay for end-of-life services ahead of time. 

Fortunately, the steps above can help you ensure that your prepaid cremation goes according to plan. 


Sources

  1. “Funeral Costs and Pricing Checklist.” UNT Libraries. ybercemetery.unt.edu/archive/oilspill/20130220082206/http://www.consumer.ftc.gov/articles/0301-funeral-costs-and-pricing-checklist
  2. “Should You Prepay For Your Funeral? Safer Ways to Plan Ahead.” Funeral Consumers Alliance. funerals.org/?consumers=should-you-prepay-for-your-funeral

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