We all die — might as well plan for it, financial experts say – National

If you’ve been thinking about what kind of funeral you want, you might be interested in planning it yourself and paying for it while you’re still alive. In fact, experts say it could be a smart financial decision.

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This is what Janet Gray, an advice-only financial planner at Money Coaches Canada, recently did. In total, she and her husband prepaid the cremation costs of about $3,000. I hope this makes it clear that you don’t want to go through an expensive funeral and that things will be easier for your loved ones in the future.

“Paying now means paying in today’s dollars,” Gray said.

Gray is one of many Canadians who plan ahead to keep post-mortem expenses in check.

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With the exception of some religions and cultures that follow specific burial practices, one of the big decisions you may make yourself is choosing between cremation and burial.

Cremation is much more popular than burial in Canada, partly because it costs less.

Nearly three-quarters of all deaths in Canada in 2021 will be cremated, according to the North American Cremation Society. This percentage has risen steadily over the years, starting at 48% in 2000.

According to Mallory Greene, CEO of online cremation service Eirene, burials often cost thousands of dollars more than cremation, so it’s no surprise that cremation has grown in popularity over the years.

The difference is partly due to all the trinkets that accompany the burial, from the coffin to the embalming of the body. A lot of people don’t realize how much extra it costs. Greene said if you ask for a breakdown of prices, you might be able to leave some of those costs behind unless legally required to do so. , you may be able to opt out of embalming.

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But the actual funeral costs can also skyrocket, Green said. Part of the reason is that some people are moving away from traditional funerals for more unique and personal celebrations of life.

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“I think the biggest key here is to decide on a budget and work from there,” she said. It doesn’t have to cost a lot.”

Green added that not much information exists about the actual costs of funerals, burials and cremations.

People may also have difficulty asking questions and making financial decisions while dealing with grief, and may end up paying more than they need to as a result.

“With so little information available, it makes sense why people spend so much money.”

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Affordable funeral planning

There are also many options to help cover some or all of the funeral costs, depending on your circumstances.

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If the deceased received social assistance, Green said, the state could pay for it. There are also government aids available for Indigenous Peoples, Veterans and other groups.

Funerals and burial or cremation are the most obvious costs of death, but Gray said you should expect up to about $10,000 in other short-term costs, from vacations to childcare to flights and hotels.

Without the will, Gray said, he might have to hire a lawyer or an accountant.

In many cases, whether there is a will or not, the estate may be able to cover funeral expenses, but the funds are not always released immediately.

According to Maria Tanel, a real estate expert at Objective Financial Partners, real estate can free up funds to help with funeral costs in as little as two weeks.

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If the deceased had life insurance, it will take time to pay out, so you cannot rely on it to cover the initial cost.

There is also a death benefit provided through the Canada Pension Plan. This allows an executor, spouse, or family member to apply for her $2,500 if the deceased has made CPP contributions for a period of time.

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If you choose to prepay for your funeral, your money will be placed in trust so that even if the funeral home goes out of business or moves to another location, your payments are safe and paid directly to the funeral home when the funeral is over. is stored in The time will come, explained Greene.

“It takes a lot of both the emotional and financial burden off,” she said.

You can also get funeral insurance, which pays directly to the funeral home when you die, Green said.

Erin Bury, co-founder and CEO of online estate planning platform Willful, recommends putting your funeral wishes in writing in your will if you’ve prepaid for services, burial or cremation costs. .

Talking about these topics with loved ones can be difficult, Berry said, but it usually makes things easier in the long run.

“I said at Christmas, ‘Mommy, Dad, what do you want your legacy to be?

“I feel like when I confided in this topic with my parents, it didn’t turn out to be this depressing conversation.”

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