What Final Expense Life Insurance Is?
While most people hate talking about end-of-life issues, it is necessary to plan for them. Getting a good final expense insurance package can zap that anxiety away. Expenses associated with the death of a loved one, like caskets, hearse, headstone, embalming, etc. can have a major financial impact on those you love. Final expense life insurance can protect your loved ones from having to pay this cost out of pocket. Your family might be overwhelmed with all the thought, time, and trouble that go into coming up with the money to cover your funeral and related costs. Don’t do that to them. Give them the resources they need to take care of your end-of-life expenses without worry.
If you’re worried about how you’re going to pay for final expense insurance, just think about how much your family is going to worry when they’re looking at a total cost of $10,000 or more to handle all your end-of-life expenses. That just isn’t right for them to have to worry about right after you died. It’s not fair to them.
Three Important Things To Keep In Mind
Everyone will die someday. Everyone knows someone who has died, whether it was sudden or expected. And, we all need to cover the cost of funerals and other death-related items.
A lot of people die sooner than expected. Everyone knows a story about someone who died before their time or died in an unpredictable and strange way.
We all need to plan for our funeral. At some point in our life, whether directly or indirectly, we will have to confront the difficult financial and emotional decisions of having a funeral planned.
You Have Two Options. Do absolutely nothing. Just let time pass, and let it take care of itself. That is a terrible idea. Someone is going to have to pay for it. Your loved ones are going to have to foot the bill if you don’t have a good final expense or life insurance policy in place ahead of time.Get some form of life insurance. Final expense insurance is an excellent option. It will take care of all your immediate end-of-life expenses.Set up a pre-arranged burial plan with a funeral home.
Option one isn’t really an option. That’s not a good thing to do to the people you leave behind. Is that really what you want them worrying about when they should be trying to come together and heal?
Option two is the best choice by far. Your family will have a lot of options and plenty of money to handle your funeral and burial expenses. They will have the flexibility and options available to them to handle your end-of-life experience in the way they see fit.
Option three is not a great option. It is probably going to be cheaper to just get final expense insurance if you’re already very old. You can go down to a funeral home and purchase your whole funeral and burial in advance. This can be very expensive. A funeral can easily cost someone over $10,000, and depending upon the reception, gravesite, casket, and the cost to facilitate everything expenses can go much higher.
Final Expense Completely Taken Care Of – A policy that can pay $25,000 or more in cash, tax free, to help provide for your final, as well as any other, expenses.
Protect Your Family – No more worrying on the part of your family about expenses associated with your death, like caskets, cremation, embalming, funerary services, etc.
Final expense insurance can take a big load off your loved ones’ backs by protecting them from having to pay these expenses out of pocket.No Family Drama – The emotional toll on those you leave behind will already be high. There is no reason they should have to worry about financial things, too. Why add to the stress and sadness they’re already feeling? Knowing that all your final expenses are taken care of will make the whole process a lot smoother. Financial worries can cause infighting in the family, too. Who will pay for what?
Peace Of Mind – The average cost of a funeral is nearly $10,000. It might be more, though. If you get a policy that covers much more than that, you can take care of almost anything associated with the death of a loved one. Final expenses can quickly spiral out of control. It helps to have a solid, high-paying policy in place. If you don’t have final expense insurance, your family could be suffering needlessly.Worry-Free Family – Your family won’t have to worry about money at all when you pass. There won’t be sibling rivalry, scrambling for money, or infighting. The focus will be on the family, not on money.
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How Life Insurance Can Provide Support For Final Expenses.
Planning for the end of your life is not pleasant. No one wants to do it. But, the thought of leaving your loved ones to take care of your final expenses isn’t pleasant, either. In some cases, financial obligations can delay settling up on your estate. Think about these five points about final expenses and how final expense insurance can help pay for them.
Funeral Costs Can Be Very Expensive:
Funeral costs are always going up. Caskets and headstones are just part of the expense outlay. You can read more about the complete expense outlay in the table below. There are transportation costs, clergy donations, ceremony fees, and a whole lot more.Funerals Are Just One Of Many Final Expenses:
Funerals may be the biggest final expense, but they’re certainly not the only one. Household bills, unpaid medical bills, and outstanding home loans all have to be paid. Credit card balances and utility bills are just some of what you have to think about. There are many unplanned financial expenses and other things you have to think about. There’s a whole lot that’s going to come up when someone dies.Final Expenses Can Have An Impact On Your Will Planning:
You may have come up with a will or estate plan without thinking about the final expense costs. It might just be now becoming clear that final expenses can take a toll on the bank accounts of loved ones. A final expense policy may make sense and the cash payout can help your beneficiary with some of the financial costs left behind like every day costs or estate taxes.You Might Be Able To Use Final Expense Funds In Advance:
There are lots of medical costs in the last months or years of life that might not be covered by health insurance. If your life insurance is a permanent policy, also called whole life insurance, that accumulates cash value over time, you might be able to access this cash value to help pay the medical bills.No Medical Exam Final.
We came up with this handy chart to help you see just how expensive death expenses can be. If you think you and your siblings will just be able to come up with money easily, you’re probably in for a surprise. Once you take a look at this chart, you’ll see why final expense insurance makes a whole lot of sense.
Casket and Vault
Basic Funeral Services Fee
Funeral Facilities Fee
Transfer of the Deceased
Other payments, e.g., cemetery plot, headstone, etc.
Who Qualifies For Final Expense Life?
Almost anyone can qualify. Since there’s usually no medical exam, the cost can be quite high. It might be better to wait until you’re older to get a final expense policy. However, there are some people who just won’t qualify. While admittance is easy for most people, there are some that just won’t be able to get coverage. Read below to learn more.
Who Doesn’t Usually Qualify?
Some people might not qualify for final expense insurance. People in hospice care, those who are hospitalized, some in a nursing home, those 90 or older, and other vulnerable people might not qualify. Sometimes, a policy will disqualify anyone over 80 or 82. Different companies have different policies and age thresholds, so be sure to check out a number of different companies to get the best deal. Some might cater to very old people who can’t get coverage at a good price elsewhere. That’s the company you want to work with if you’re very old.
If you’re employed in a dangerous vocation, have risky hobbies, or have a serious medical condition or ailment, you could be disqualified.
If you’re currently in the hospital for something serious, or you’ve been hospitalized for a number of weeks in the past year, or you’re living in assisted living or retirement home, you might be disqualified from getting coverage. Shop around so you can get the best policy for your age, health, and final expense plan.
Watch out for special clauses in the contract. It seems smart to just rush into a policy if you think you might die in the next year, but some companies have contestability clauses in their contracts. What that means is that a company or insurance agent has the right to contest the payment of a death benefit and void the payout if the policyholder dies within the first two years of coverage.
Who Should Buy Final Expense Insurance?
Who usually purchases a final expense policy? Even though people of all ages can typically buy final expense insurance, this type of coverage is mostly sold to senior citizens. Due to this, a final expense policy can be an excellent alternative for more traditional types of coverage – especially if a senior citizen has already been denied coverage elsewhere.
The short answer is that anyone and everyone should buy final expense insurance. Everyone is going to die, and final expense insurance can take care of something that every family will have to deal with.
If you want to save your family the trouble of dealing with your end-of-life costs, go ahead and purchase final expense insurance.
How Much Will Final Expense Insurance Cost?
The cost of a funeral and related expenses continues to rise, and that means final expense insurance is more than it used to be.
The average funeral cost now is around $8,500. But, $10,000 might be a better estimate. However, if you add in additional fees for cemetery, flowers, obituaries, headstones, monuments, etc., the cost can rise to $14,800. If you project out at about 5% inflation per year, the average cost by 2030 would be about $18,200. So, better be safe than sorry and get about $25,000 worth of coverage.
Speed Of Policy Issuance
Coverage can be gotten relatively quickly. A lot of the time, there is no medical exam required. Almost anyone in a certain age bracket with no serious medical conditions can qualify.
How Long Will You Need To Make Payments?
You will usually need to make premium payments for as long as you want the policy to stay in full force. If you stop making payments, you could lose your coverage. If you let your coverage lapse, they can cancel your policy, and you’ll be out of luck. If you purchase final expense life insurance early enough in life, and your dividend payments are high enough, you may be able to have your dividend payments cover your cost of insurance and you may not need to make additional payments.
Final expense insurance is a must-buy item for you and your family. Do you really want to leave them hanging after you’re gone? You want them to come together for a time of grieving, healing, and love. You don’t want to complicate that with a lot of financial infighting and negotiating. It can really ruin your funeral and mar your memorialization.