Wall Street Journal refered folks to NO FUNERAL PRENEED today.
5/2/09-Today the Wall Street Journal referred Americans to the no funeral preneed people, the Funeral Consumers Alliance. This is a good thing. IF YOU WANT TO COME IN UNDER THE AVERAGE COST OF A FUNERAL- It is best not to do funeral preneed or prepay a funeral.
In the article today “Planning for your Funeral here is a guide to smart shopping” the WSJ quoted Joshua Slocum.
“Go to funerals.org and click on the tab that says “find a local FCA.” Clicking on “funeral self-help — answers to frequent questions” under the main menu, then scrolling down and clicking on “funeral arrangements,” will pull up a list of publications including “Four-Step Funeral Planning: Where to Start When You Don’t Know How to Start!”
One of the biggest decisions you will face is whether to pay in advance for arrangements you make. Joshua Slocum, the alliance’s executive director, cautions against advance payments. He says many people don’t understand the fine print in their contracts, consumers could lose earnings on money being held in trust by a funeral home, and contracts can get lost.”
What has attracted people to preneed or prepaying a funeral for a generation has been the promise that one can lock in today’s prices for funeral and not have to pay more later.
In this economy this is simply not the case. It is my opinion that “any honest Funeral Director will not sell you Guaranteed Preneed” now. In this fragile economy investments can not be guaranteed now or in the near future.
They certainly cannot guarantee any investment or bank account 5-20 years out.
A Funeral is always a business contract.
As i have said before it is best for the funeral consumer to not do funeral preneed or prepay a funeral.
The two scandals mentioned at this blog the IFDA Preneed Trust mess (Illinois Funeral Directors Association) and the National Prearranged Services(NPS) scandal alone are reason enough not to prepay a funeral.
In the article the Wall Street Journal said a quiet “No” to funeral preneed.
Funeral industry|funeral blog by your funeral guy.
UPDATE: MAY 3rd 2009 This blog post encourages you to avoid guaranteed preneed, other non guaranteed approaches may be viable. Certainly reputable life insurance is an option.
Your Funeral guy is not affiliated with Joshua Slocum, and is simply pointing out here that the Wall Street Journal has quietly steered the folks away from preneed.
Wall Street Journal pic from flickr under the creative commons license from
Funeral Guy,
SIGH……………I am sooo disappointed in you. I have given you so much information on the IFDA debacle as to educate you to what happened, and you are still taking swings at the good guys. I was really in hopes that I had won you over as to how things worked out here in Illinois, and that NPS was simply pure theft by the owners of the company. Is it really our faults that these deadbeat offenders of public trust have no integrity??? Your being an Illinoisan and having first hand access to information is frustrating at best.
The regulators, more specifically, The Comptroller’s Office FAILED us licensees by not notifying us that there were in fact problems with IFDA investments. We individually are HELD ACCOUNTABLE by that office on an annual basis when we are audited by the IOC’s field auditors on accounts we hold in trust. Butts pucker when these guys come around. All of the earnings statements from IFDA show the accounts were compounding with interest. The IOC was not accountable to the very people they license (each funeral home) when they knew one of the third party independent trustee’s (IFDA Services, Inc.) portfolio was in the tank and didn’t act immediately upon its’ discovery. To repeat, As simply as I can put it, THE REGULATORS FAILED US!!! And yes, It was our own people on the IFDA Board of Directors withholding information to it’s trust participant firms and rubber stamping anything the Executive Director wanted, It’s former Executive Director, and It’s financial Adviser and Merrill Lynch(ed) that are responsible for the mess. How much more clearer can I be here? YOU, my friend, (yes, I still consider you a friend) are not paying attention.
They May 20th hearing for the money man, Ed Schainker, is soon approaching. I’m telling you, he isn’t going to lose his securities and exchange license and not squeal. Be there early as seating is limited I hear. Merrill Lynch could possibly lose it’s license to operate in Illinois if this plays out right. Can you say domino effect.
If this hearing and the lawsuits don’t clear things up maybe a FEDERAL GRAND JURY PROBE into this will. I’m not saying there is, but one wonders with all of the players, involved I think if I were a federal prosecutor, the stories would be getting my attention. I encourage everyone who has not read, to please read the derivative lawsuit filed by Calvert et. al., it gives you an accounting of the blunders leading up to the day this mess was finally revealed.
Both you and I are the most vocal outspoken critics of IFDA. Change is coming to IFDA as most of the troublemakers will soon be out. Their day of reckoning is coming, trust me. I hope the new Board members will vote to have the Boardroom fumigated, and an exorcist brought in to drive out any possible evilness that may exist causing further fraudulent practices.
I’ve told you before to wake up and smell the roses in the casket spray Funeral Guy!!! You and that self appointed “expert” Joshua Slocum from the FCA aren’t doing the consumers across this once great land of ours any favors. FEAR MONGERING is all you gent’s are doing by telling the folks not to prepay their funerals because those evil funeral directors are going to misappropriate your money, when you could in fact be doing the folks a real favor and letting them know there are other safe, viable options that funeral homes, insurance companies (and I am not talking about burial insurance Co.’s) and banks have available, and it varies state by state.
If AARP would put their minds to it, they could be / or could have been, the largest pre-need company. no merchandise, or service guarantees, selling paid up or blocks of 5, 10, 15 or 20 thousand dollars with interest /dividends to bear, call the F.H. of your choice, proceeds assignment, done and over. And I’ll bet a Wall Street firm thereof would pounce on it with CFA’s blessings because a funeral home wouldn’t be in the picture until at need. They could buy up Everest concierge service, have AARP / CFA approved seals of approvals for funeral homes (for a fee of cour$e) and all so forth. (Brilliant idea if I say so myself, I want the credit and compensation if it comes to fruit). Hell, AARP could be the Funeral Czar for O’Bama, they already shop F.H.’s for the FTC.
The vast majority of pre-need contracts held are on people in the nursing home / assisted living facilities and are on Medicaid Assistance, and are required / forced (whatever word you wish to use) to do so if they want assistance so us taxpayers aren’t paying for their funerals in part. These are the folks who have outlived their financial resources.
I can tell in your comments that both of you hate funeral service with a passion. I think you have both had bad experiences in funeral service. I wish there was something I could do to help you overcome that experience.
There have been numerous bank failures across the county. Have you and Mr. Slocum bothered to investigate to see if those institutions held prepaid funeral accounts and if consumers and funeral homes alike were injured? (FDIC ins. accounts make a difference) Hell, are Stockholder owned insurance companies a safe option? What’s to happen with all of the irrevocable / collateral assignments of policies that so many of us have?
As far as F.H.’s not wanting to guarantee a funeral here’s one for you. Go to any auto dealership. Tell them you want to select a car today, pay for it, and take delivery five years from now. They’ll laugh you out of the showroom. In fact, try it with any consumer product. It was never a good idea to guarantee, but it was a selling point, and used unwisely. Several firms are eating the buttered crow of the shortfalls guaranteed contracts are bringing in today, be it a trust or insurance agreement. As you know, the guaranteed and non-guaranteed contracts were both hit at a 34% writedown, and continue to loose ground because of the mark to market accounting principles they are exposed to in the type investment product they are invested in. Shortfalls on contract are not exclusive to IFDA or NPS, it’s nationwide as I am hearing.
I’m not sure if either of you or Mr. Slocum have ever been self employed. The fixed costs of operating a funeral home today is outrageous. Facilities, properly trained, licensed, and compensated staff, all the different taxes, insurances and compliance issues and the list goes on. And he wonders why funerals are so damned expensive? Did it ever occur to FCA that not everyone wants to care for their dead? Irregardless of what you funeral service doomsdayers say, there are those of us F.D’s out here who will continue to prosper because will and do give the consumer what they ask for, within reason, and we do it with pride and integrity on a daily basis.
As always, thanks for the opportunity to speak up on the subject matter at hand. I appreciate your blog. I just wish you would give the majority of us out here the benefit of the doubt with the IFDA and NPS collapses. I want to see you approach the matter like this from now on, What has happened has happened, what are we going to do to get on with life and move forward and take care of the folks who entrusted their monies to us. Please be more balanced in your future articles. I firmly believe that the justice system will allow the funds to be recouped.
Math problem / formula:
Merrill Lynch + Bank of America divided by TARP funds = possible recoupment of 59,000,000.00 plus, of some 40,000 IFDA accounts.
your thoughts please.
Respectfully,
MarsellusM710