Understandably, most people prefer not to spend too much time contemplating their own death. Nevertheless, including a funeral and burial planning component in your overall estate plan is highly recommended because it almost always saves surviving loved ones time and money and it ensures that your wishes will be honored. Our Phoenix estate planning attorneys at Morris Hall PLLC explain how a life insurance trust can help you.
Why Is Funeral and Burial Planning Important?
Although it is easy to understand why you might prefer not to focus on your own death, the reality is that none of us are immortal. Moreover, much of your estate plan is already focused on what happens after your death so it should be only natural to include a funeral and burial component in that plan. If you still need convincing, however, consider the following reasons:
- Dying is costly. A modest funeral and burial cost around $10,000. That figure can easily double or triple if you want specific plots, an elaborate tombstone, or a large ceremony. Planning ahead ensures the funds will be available so grieving loved ones are not stressed trying to access the money.
- Grieving survivors do not make good decisions. The people you leave behind will not be in a position to make wise choices about much of anything because they will be saddled with grief. They may completely forget any of your wishes as well.
- Grief spurs conflict. Someone has to be in charge of your funeral and burial. If it isn’t clear who that person is, conflict is likely. When two or more people think they know what you would want, it can cause the entire process to become a circus.
- Grieving loved ones make easy prey. Not surprisingly, grieving survivors often purchase services they don’t really need and spend considerably more on the funeral than was necessary because grieving loved ones make easy prey for salespeople.
What Is an Irrevocable Life Insurance Trust and How Can It Help?
Many people choose to include an Irrevocable Life Insurance Trust in their funeral and burial planning component. An Irrevocable Life Insurance Trust (ILIT) is a special type of trust that is funded by the proceeds of a life insurance policy. As the Settlor, you create the trust and appoint a Trustee to administer the trust. This should be the person you wish to be in charge of your funeral and burial after you are gone.
You then purchase or transfer in, a life insurance policy, the proceeds of which payout immediately into the trust upon your death. Those proceeds then fund your funeral service. Because trust assets are non-probate assets, your Trustee will have immediate access to the trust funds, making it simple and easy to access the funds needed for the funeral.
Along with providing the funding, however, you can also use the trust terms to ensure that your burial and funeral are carried out according to your wishes. For instance, you can use the terms to specify where you want to be buried or that you want to be cremated. You can be extremely detailed — providing a list of music, dictating the guest list, and choosing the flowers – or keep it general. Your Trustee will be legally obligated to abide by those terms once the trust activates. This all but eliminates the possibility of conflict over the details of your funeral and burial.
By including an ILIT in your funeral and burial plan you ensure that your wishes will be honored while simultaneously preventing family conflict by removing the need for loved ones to make decisions and eliminating the struggle to locate funds.
Contact Our Estate Planning Lawyers
If you have additional questions or concerns about creating a funeral trust, contact the experienced Phoenix estate planning lawyers at Morris Hall PLLC by calling 888-222-1328 or 602-249-1328 to schedule your free consultation today.
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