funeral expenses - question and opinions needed

[wardf]

Hello,

My parents are in their mid-80's and purchased funeral services (plot, stone...etc) 12 years ago - to be used when they passed.

They recently wanted to to change some of the services (move from indoor to outdoor...etc) and spoke with the funeral place to assess the cost. The services they wanted to change were essentially the same cost (not a upgrade or downgrade - just a shift from one service to another).

What they quoted surprised me - they credited the cost of what they wanted removed ($1700 from their original payment) and charged for the services they desired ($4900 which is the current cost of the new services), so a $3200 bill just to change some services. The point here is that they bought services 12 years ago, and those services in today's pricing have increased dramatically due to inflation...etc.

I can see an incremental cost of approx $500 to process the changes, but to essentially refund their original price and charge for new services at current prices seems very unfair - opinions???

Thank you

[Like2Plan]

Sounds like a rip off to me.
What if it is raining on the day services are to be held and services have to move indoors? Are they going to do the same thing?

[disneysteve]

I'm not so sure I see a problem with this (though I'm still juggling it in my mind). They prepaid for services 12 years ago in order to lock in the prices at that time. Now, they are essentially changing the deal. They are cancelling what they prepaid for 12 years ago and signing a new contract today to prepay for different services. Why should the place have to honor 12 year old prices? Even if the new services are the same price as the former services, it is a new deal, a new agreement.

[Like2Plan]

Why should the place have to honor 12 year old prices? Even if the new services are the same price as the former services, it is a new deal, a new agreement.

Disneysteve,
They should at least bridge the difference. In other words, they should give them credit for what the former services cost today (which is what they would have had to do to honor the agreement) and then charge them the difference for what the revised services would cost.
But, knowing what they know now it would say to me they would be better off not prepaying for services--because if anyone decides to make any kind of changes at the time of passing (which sounds like it is possible--they have already changed their minds once) they won't get any real benefit for prepaying.

[disneysteve]

They should at least bridge the difference. In other words, they should give them credit for what the former services cost today (which is what they would have had to do to honor the agreement) and then charge them the difference for what the revised services would cost.

That would certainly be nice of them to do but I'm willing to bet the original contract said nothing of the sort. It probably says something to the effect that any changes or additional services purchased in the future will be at the going rate.

OP, I'd have them pull out the original paperwork and read the contract. See what it says about changes.

[Like2Plan]

That would certainly be nice of them to do but I'm willing to bet the original contract said nothing of the sort. It probably says something to the effect that any changes or additional services purchased in the future will be at the going rate.

OP, I'd have them pull out the original paperwork and read the contract. See what it says about changes.

Of course you are right, there should be terms stated in the contract they signed. They should have a copy of it (and so should the kids-when it comes time to use it). But, I can't see the benefit to having such an agreement if they don't have a reasonable provision for changes. Over time, people can change their minds. Also, the person who passes away will not be implementing the arrangements so there could be changes as a result of that. Perfect example--they have outdoor services planned and it's raining....

[disneysteve]

Also, the person who passes away will not be implementing the arrangements so there could be changes as a result of that. Perfect example--they have outdoor services planned and it's raining....

And that's a good reason not to prepay years or decades in advance for things like this.

[dontgopoor]

If the funeral home has or will honor the terms of the original agreement, the situation seems perfectly fair.

The issue is that you (or your parents) want to buy something today and the price is higher than it was twelve years ago You can either not pay the current price (keep what you originally bought) or pay the current price.

[JoeP]

They should have been refunded at today's rate if they are going to be charged at today's rate.

[disneysteve]

They should have been refunded at today's rate

No they shouldn't. From the business owner's perspective, the point of offering these pre-paid plans is that they get the use of that money for years or decades. If they had to refund it on demand at current market value, it would totally defeat the purpose of offering the plan.

[JoeP]

No they shouldn't. From the business owner's perspective, the point of offering these pre-paid plans is that they get the use of that money for years or decades. If they had to refund it on demand at current market value, it would totally defeat the purpose of offering the plan.

I was kind of half-joking. Just seems to be kind of heartless to sit on that money for so long, using it as you said, and then turn around and give it back without at least accounting for inflation. I hope they gave a break to their clients on the change.

We won't be pre-paying this. It will be a simple cremation and a party somewhere like a town park.

[dontgopoor]

We won't be pre-paying this. It will be a simple cremation and a party somewhere like a town park.

Agree with you completely. I recently helped someone deal with funeral arrangements - my first experience with that industry. While the funeral director, aka sales rep, was very polite and respectful, the sales pitches were expertly made.

[breathemusic]

While I don't necessarily think the funeral home should have to refund the services at today's price... shouldn't they at least have to provide a credit for the amount of the previous payment plus whatever interest they've earned on it over 12 years? Prices for services can increase more or less than interest rates, but by pre-paying, they were basically able to earn money off of that payment.

That's usually the standard for things like security deposits on apartments as well. Often you get that back plus the interest. That only seems fair to me. Though maybe that has to be in the contract as well.