A Funeral Expense Trusts Offer Many Advantages

[Dale M Krause]

Unity Financial offers an irrevocable funeral trust (IFT), an excellent option for individuals who want to prepare for their final expenses and protect their legacy. The IFT provides several benefits, including asset protection, Medicaid eligibility, avoiding probate, customization, and peace of mind.

When you establish an IFT, the funds you contribute are exclusively reserved for funeral and burial expenses and protected from creditors. This protection ensures that the funds you intend to use for funeral expenses remain intact and can't be accessed for other purposes.

An IFT also helps you qualify for Medicaid while having funds available for funeral costs. Medicaid has strict asset limits, but an IFT enables you to meet those requirements by excluding trust assets from your countable resources.

Assets held in an IFT bypass the probate process, so your loved ones can access the funds directly without going through the court system. Additionally, you have control over how the IFT is structured, and you can choose beneficiaries, specify funeral preferences, and even select funeral service providers. This customization ensures that your wishes are followed.

Finally, an IFT provides peace of mind, knowing that your funeral expenses are covered and your loved ones won't face financial strain during a difficult time. It allows you to focus on other aspects of life without worrying about these practical matters.

Remember that an IFT is irrevocable, meaning you cannot change or revoke it once established. It's essential to consult with a financial advisor or estate planning professional to determine if an IFT aligns with your goals and circumstances. They can guide you through the process and help you make informed decisions.

 

[titeye]

Your sales pitch is targeting the wrong market. Final Expense targets the impoverished population, not the affluent. The individual would need to pay an attorney simply to draft the Trust, only to be told afterwards that they need to fund the trust with a life insurance policy. I don't know of any attorney whose fees are less than $250/hr. It's challenging enough getting the FE population to pay $50 every month on a policy. The costs associated with hiring an attorney to create the trust far outweigh any of its benefits that are not duplicated within the policy itself.

The prospect doesn't need to hire a financial advisor to fund a FE policy. Even if they did take your advice and sought one out, they would be politely turned away as soon as the financial advisor completed his fact finder and realized these individuals have no money to invest.

 

[Newby]

Your sales pitch is targeting the wrong market. Final Expense targets the impoverished population, not the affluent. The individual would need to pay an attorney simply to draft the Trust, only to be told afterwards that they need to fund the trust with a life insurance policy. I don't know of any attorney whose fees are less than $250/hr. It's challenging enough getting the FE population to pay $50 every month on a policy. The costs associated with hiring an attorney to create the trust far outweigh any of its benefits that are not duplicated within the policy itself.

The prospect doesn't need to hire a financial advisor to fund a FE policy. Even if they did take your advice and sought one out, they would be politely turned away as soon as the financial advisor completed his fact finder and realized these individuals have no money to invest.

The trusts he’s talking about don’t require an attorney. They are just a standard form. You are just giving up ownership to the trust to make it exempt from Medicaid and to be used to cover funeral and burial costs. Same as assigning a policy to a funeral home.

 

[jdeasy]

Your sales pitch is targeting the wrong market. Final Expense targets the impoverished population, not the affluent. The individual would need to pay an attorney simply to draft the Trust, only to be told afterwards that they need to fund the trust with a life insurance policy. I don't know of any attorney whose fees are less than $250/hr. It's challenging enough getting the FE population to pay $50 every month on a policy. The costs associated with hiring an attorney to create the trust far outweigh any of its benefits that are not duplicated within the policy itself.

The prospect doesn't need to hire a financial advisor to fund a FE policy. Even if they did take your advice and sought one out, they would be politely turned away as soon as the financial advisor completed his fact finder and realized these individuals have no money to invest.

This is just the latest gimmick, ie; FCGS, Legacy, Settlers crap, Concierge and on and on, to play on the fears put forth by the idiots at the funeral homes, nursing homes and welfare centers.

It's never the issue with life insurance that it's made out to be by the fear mongers. The funeral homes are the worst because they are afraid their cheese will get moved.

The cash value is simply a countable asset. Just stay on top of reporting and it will not become an issue. If they have too many assets combined then they might lose their welfare. But they are not deserving of welfare if they have the assets.

This might be something of use in a financial planning portfolio? But it just muddies the water for the FE demographic that only has one question; what's in it for me??

 

[DonP]

This is just the latest gimmick, ie; FCGS, Legacy, Settlers crap, Concierge and on and on, to play on the fears put forth by the idiots at the funeral homes, nursing homes and welfare centers.

It's never the issue with life insurance that it's made out to be by the fear mongers. The funeral homes are the worst because they are afraid their cheese will get moved.

The cash value is simply a countable asset. Just stay on top of reporting and it will not become an issue. If they have too many assets combined then they might lose their welfare. But they are not deserving of welfare if they have the assets.

This might be something of use in a financial planning portfolio? But it just muddies the water for the FE demographic that only has one question; what's in it for me??

I’ve always wondered does medicad have a way to see how much cash value you have in your life policy ? These peeps aren’t going to report it and I’m pretty sure mediciad has no way to see how much you have .

 

[jdeasy]

I’ve always wondered does medicad have a way to see how much cash value you have in your life policy ? These peeps aren’t going to report it and I’m pretty sure mediciad has no way to see how much you have .

They don’t have a way to know unless the person reports it. They are required to report it.

One of the questions on the welfare application is “do you own any cash value life insurance?”

Of course they can say no.

But they do have access to their bank account. That’s also a requirement. They take a “snapshot” the first of every month.

If they see they are paying on life insurance they will demand they show them what it is. And the demand is met because they can cut off their benefits until they show it.

I provide those letters to case workers for my customers every week.

I don’t think they can figure out what they have if paying with a DE card. So that person telling them they don’t own a policy might get by with it for a while.

Today that is the number one reason someone doesn’t want to do bank drafts.

They have been lying to the welfare office and don’t want them to find out now.

 

[titeye]

This may not be the section for this question but, since were on the subject, I will start here.

My client passed away last week. His common law wife, who is also my client, has already received $12,000 from one policy. She will receive an additional $100,000 from another policy. There is a 3rd policy that he had through his employer. The insurance company will not release any specifics, until they receive a death certificate. This includes releasing names of beneficiaries, coverage amount, etc.

Prior to him passing away, they lived together in Section 8 Housing.
She receives SSI due to her disability and will remain in that home.
If she reports this windfall, she will lose all government benefits. Her goddaughter is the only person remaining in her life that she feels she can trust. "Their plan" is to deposit the proceeds in the goddaughter's bank account to avoid losing these government benefits. In addition, they are agreeing to limit my client to a maximum of $600 per month allowance.

This morning, I expressed to my client that their plan a bad idea on multiple levels. She is open to alternatives.

The client is only 43 years young. I have observed signs that lead me to believe her disability is intellectual, or at least affects her ability to learn. She truly requires protection. She has never had the responsibility of managing large sums of money, and his could go bad for her in a hurry.

If income from an immediate annuity does not push her over the maximum allowed to continue receiving SSI, would this be the solution to these foreseeable problems?

 

[Newby]

I’ve always wondered does medicad have a way to see how much cash value you have in your life policy ? These peeps aren’t going to report it and I’m pretty sure mediciad has no way to see how much you have .

They audit your financials once every year or two. Your check book shows where you pay insurance premiums. Then they require you provide a current cash value statement from the insurance companies.

I’m not sure how they would get info on debit express payers or on paid up policies.

 

[Newby]

This may not be the section for this question but, since were on the subject, I will start here.

My client passed away last week. His common law wife, who is also my client, has already received $12,000 from one policy. She will receive an additional $100,000 from another policy. There is a 3rd policy that he had through his employer. The insurance company will not release any specifics, until they receive a death certificate. This includes releasing names of beneficiaries, coverage amount, etc.

Prior to him passing away, they lived together in Section 8 Housing.
She receives SSI due to her disability and will remain in that home.
If she reports this windfall, she will lose all government benefits. Her goddaughter is the only person remaining in her life that she feels she can trust. "Their plan" is to deposit the proceeds in the goddaughter's bank account to avoid losing these government benefits. In addition, they are agreeing to limit my client to a maximum of $600 per month allowance.

This morning, I expressed to my client that their plan a bad idea on multiple levels. She is open to alternatives.

The client is only 43 years young. I have observed signs that lead me to believe her disability is intellectual, or at least affects her ability to learn. She truly requires protection. She has never had the responsibility of managing large sums of money, and his could go bad for her in a hurry.

If income from an immediate annuity does not push her over the maximum allowed to continue receiving SSI, would this be the solution to these foreseeable problems?

She is trying to commit Medicaid fraud. You don’t want to get tangled up with that. If they would have known ahead of the death to NOT make her the Benny, it would have been fine. But giving the money away so that WE the taxpayers have to pay for her needs when she has the money to pay it herself is a crime.

 

[jdeasy]

This may not be the section for this question but, since were on the subject, I will start here.

My client passed away last week. His common law wife, who is also my client, has already received $12,000 from one policy. She will receive an additional $100,000 from another policy. There is a 3rd policy that he had through his employer. The insurance company will not release any specifics, until they receive a death certificate. This includes releasing names of beneficiaries, coverage amount, etc.

Prior to him passing away, they lived together in Section 8 Housing.
She receives SSI due to her disability and will remain in that home.
If she reports this windfall, she will lose all government benefits. Her goddaughter is the only person remaining in her life that she feels she can trust. "Their plan" is to deposit the proceeds in the goddaughter's bank account to avoid losing these government benefits. In addition, they are agreeing to limit my client to a maximum of $600 per month allowance.

This morning, I expressed to my client that their plan a bad idea on multiple levels. She is open to alternatives.

The client is only 43 years young. I have observed signs that lead me to believe her disability is intellectual, or at least affects her ability to learn. She truly requires protection. She has never had the responsibility of managing large sums of money, and his could go bad for her in a hurry.

If income from an immediate annuity does not push her over the maximum allowed to continue receiving SSI, would this be the solution to these foreseeable problems?

Tell her to see an eldercare attorney. Don't give advice on committing welfare fraud. That seems to be her plan.


"My agent told me to do it this way."

Don't be the agent in that sentence. In fact, put it in writing you advice is to seek legal counsel.