Category Archives for Retirement

The Best Of…Many Opting to Pre-Plan, Pre-Pay for Funerals

Published on February 1, 2003

             For me, it was stressful attempting to get my elderly father and my mother with dementia to enter into a pre-need agreement funeral arrangement.  After all, my three siblings and I were only trying to give our parents the opportunity to have a say in their minute details of their final arrangements.

            With my confused mother at his side, my father choose their caskets like he was purchasing a new car.  He checked under the lid, throughly examined the lining and the wood.  Ultimately, he would not buy the cheaper model, but he chose a nice one, a little higher on the price list.

            Of course, my father told the funeral director their services would be held at Temple Emanuel  with the family Rabbi presiding.  But what type of music, vocal or instrumental did they want played?  Or did they want a visitation or to name their  pallbearers.  Closed or open casket?  All these decisions might have been made right there on the spot, but in the end my father backed out.

           A little technicality over paper work derailed the process, causing my father to not sign on the dotted line and walking out of the funeral home in a huff.

           My father’s experience was not the norm because most aging baby boomers make it through the most stressful process of pre-planning and pre-paying in advance.

           According to a 1998 AARP survey, two in five people age 50 and older reported that they were contacted about the advance purchase of funerals.

           About one-third of those responding said that they had prepaid, or were in the process of prepaying, for funerals or burials.  Of this group, 86 percent had prepaid for cemetery plots, mausoleums, or niches, 58 percent had paid for other burial goods or services and 40 percent had prepaid for funeral services.

          For those prepaying for funerals, 30 percent had funds in trust and 30 percent had funds in life insurance policies.  Sixty percent held title to a cemetery plot, and 15 percent said they had that money in a life insurance policy.

         Ted Wynne, funeral director of Pawtucket-based Manning-Heffern Funeral Home, sees a transient society where children are living in different states, fueling the demand for pre-planning and prepayment.  “Seniors want to take the pressure off their children who live thousands of miles away from making the burial arrangement,” Wynne says.  “Thus, they pay up front or set aside money for future funeral and burial payments.”

        Bradford Bellows, funeral director of D.W. Bellows & Sons, Pawtucket and Bellows-Falso Funeral Chapel in Lincoln, says the seniors in nursing  homes are also good candidates for prepaying a funeral.

        “The family watches their parents’ funds dwindle to a point where they are forced to go on Medicaid.”  Prior to being eligible for Medicaid, the senior or their children should prepay the funeral costs.  Assets given the funeral home are allowed under Medicaid eligibility guidelines prior to going on Medicaid.

           “Consumers must understand that pre-arranging a funeral is not the same as pre-paying one,” Bellows adds.

            By pre-paying a funeral you are actually paying  for a funeral at today’s prices, not tomorrow’s, Bellow says.  “If the funeral occurs in the future, the funds will earn interest which will be used to pay for the cost of the funeral at the time of the death.”

           Bellows offers these tips when pre-paying your funeral.

           1.  Make sure that your social security number is indicated on your savings account or insurance policy where the monies are placed to prepay your funeral.  If the funeral home ever goes out of business or goes bankrupt, the funds are still yours and are safe, and can be easily be transferred to another funeral home.

          2.  When you enroll in the Medicaid program, all the funds in your prepayment account must be used.  Any excess funds will be returned by the  funeral home to the State of Rhode Island, to defray health costs incurred by the state of Rhode Island’s Medicaid program.

         3.  Once the funeral home opens the account or insurance policy, don’t forget to get a copy of the Irrevocable Funeral Trust Agreement, showing the bank or credit union account or the original insurance policy that was issued.  This will give you proof that your advance payment has been set up for your funeral needs.

          Herb Weiss is a Pawtucket-based freelance writer who covers, aging, health care and medical issues.

The Best Of…Invest Wisely With Hard-Earned Income

Published October 8, 2001, Pawtucket Times

             With the news of the latest Federal Reserve rate cuts, stocks soared with investors showing new optimism in the stock market.  The Dow Jones industrial average has spiraled up above 9,000 for the first time since the horrific terrorist attack more than three weeks ago.  With this latest rally on Wall Street, elderly investors might be more easily influenced by scam artists to invest their hard-earned income in buying stocks, bonds, and other securities.

             According to the state’s Securities Division of the Department of Business Regulation (DBR), charged with investigating financial scams, its staff has examined hundreds of complaints filed against stockbrokers and investment advisors.

           Some complaints can be resolved quickly, others are more complicated to tackle and take more time to resolve,states David Briden, DBR’s chief securities examiner.  For instance last April DBR entered a consent order against Alpha Telecom, Inc. and ATC, Inc.

             These two companies promoted the sale of pay telephone investments to Rhode Island residents.  State regulators noted that the  high risks of this investment were not fully disclosed to the 50 Rhode Islanders, some of them elderly, who had invested approximately $960,000.  Under the terms of the order the two companies paid a penalty of $50,000 to the state.  This represented the largest administrative penalty in a pay telephone case nationwide.

           Additionally, Alpha Telecom, Inc. and ATC, Inc. were ordered to offer a full refund to the Rhode Island investors.  DBR went to Superior Court to enforce the terms of the consent order.

          In August 2001 the U.S. Securities and Exchange Commission announced that the U.S. District Court of Oregon granted a temporary restraining order and froze the assets of the two companies.  Meanwhile, in that month these companies had filed for bankruptcy in the U.S. District Court for the Southern District of Florida.  At press time, the investors are still waiting for their money to be returned.

           So how can you protect yourself against financial scams?   Don’t get reeled in by a “cold call,” touting an investment that is guaranteed to make you lots of money, warns Briden.  Especially if you have never dealt with the caller, “simply tell them you are not interested and hang up,” he says.

           “Always get written information before making any investment decision,” Briden says.  Even meet with the broker at his or her office so you get to know them and to see the firm, he suggests.

           There’s a problem if the caller can’t produce written material. According to Briden, the old adage there is no free lunch really applies to making investments, too. Don’t be conned into making a quick investment decision when high pressure sales tactics are used, Briden says, adding that any investor should “Beware of any promise made that the investment will result in quick profits or extremely high returns.  Be concerned if your told ‘Act on it now or it will be too late,” he says.

           Meanwhile, a check can be a receipt of your investment. “Never invest cash,” Briden adds, stressing that a person should never send a check to someone at a firm you know nothing about.

            Become an educated investor when considering the investment of your money. “It is important that you understand the costs (commissions, fees and penalties) to the investment,” Briden says.  “Always find out the risk involved in your investment.  Never make an assumption that the investment is federally insured or guaranteed.”

              If you suspect that you have been a victim of investment fraud, contact the State of Rhode island, Department of Business Regulation Securities Division, Suite 232, 233 Richmond Street, Providence, RI 02903, or call (401) 222-3048.

            Herb Weiss is a Pawtucket-based freelance writer who writes about aging, health care and medical issues.