Financial Poise
Share this...

Does “Planning in Advance of Need” Really Save You Money? 


The death care industry is alive and well; after all, there is never a shortage of clients.

If you are over 50, you probably receive phone calls or mailers attempting to sell you a burial plot or mausoleum crypt. In the industry, this is known as planning in advance of need – as opposed to waiting for a person to pass away before making arrangements.

There Are Benefits to Planning in Advance of Need

The typical cemetery sales pitch goes like this: You should prepare for your death and relieve the financial burden from your loved ones. Doing this for your family can be a great advantage, as the typical cemetery plot or crypt doubles in price every 10 years. So, if grandma bought a family plot 50 years ago, it is likely that she saved everyone a pretty penny.

Another selling point is that you are helping your family by making decisions for them so they won’t be subjected to the prospect of emotional overspending. For example, if you know you want a simple cremation but don’t tell your family, or make arrangements for it, it is possible you will end up with $10,000 in final expenses that will come out of your estate or life insurance benefits. Cremations run anywhere between $800-$2000, depending on where you go, so the difference in cost is enormous. Think about it. Wouldn’t you rather that money go to your grandchildren’s college education?

The Disadvantages of Pre-Need Purchases

Plots, niches and crypts are sold for the “enjoyment” and use of the person who purchases them; people who buy these properties do not actually own them. Technically, it is more like leasing, because the property is still owned by the cemetery. However, if you own rights to this property and it is not being occupied, you may be subject to a capital gains tax if it has increased in value over time.

And what happens if you don’t need the space anymore because you have decided to relocate? Purchasing a plot in California, then moving to New York, is not practical because the decedent will have to be transported to the location. If everyone else in your family is in California, this may be most practical for the family to attend services, but the costs and legalities of shipping a body are a major point to bear in mind.

Final Considerations

Regardless of whether you decide to buy in advance, or simply purchase a life insurance policy to cover the costs, make sure to discuss your intentions with your family. Informing them of your final wishes is one of the most important things you can ever do. Having a plan in place not only gives you a peace of mind, it will help your family understand what you really want when the time comes to say your last goodbyes.


Want to learn more about financial planning? Read Get Ready to Work for a Long Time if You Don’t Plan Your Retirement Well

About Michele Schechter

Michele has been a director with Financial Poise since 2012. View her LinkedIn profile here:

View all articles by Michele »