The death of a loved one is never easy, but there are ways to lighten to burden.
By setting aside funds for your funeral now, your family will have one less thing to worry about and you can have the send-off you deserve.
Why pay now?
The cost of a funeral can run into the thousands. So paying in advance can help take a burden off your loved one’s shoulders.
Funeral Trusts are currently exempt from asset testing, so you can set aside up to $10,000 in a Funeral Trust without it being taken into account when working out if you qualify for a Residential Care Subsidy.
How does it work?
To ensure you get the funeral you want, it’s important the funds you set aside grow to accommodate for potential increases in funeral costs. That’s why Funeral Trust funds are invested in low-risk, short-term money market investments.
Then, when you die, your Funeral Trust funds will be immediately available to settle the burial expenses. This means that you access early payment discounts for funeral costs. Any remaining balance will be paid to your executor for the benefit of your estate.
What are the costs?
Setting up a Funeral Trust costs $150. You’ll also need to fill out an application and make an initial minimum contribution of $3,000.
A management fee will be charged on the funds invested. There are no other fees to operate your Funeral Trust and no fee is charged when the funds are paid out. You’ll receive annual statements giving details of all the transactions over the previous year.
Income earned on your Funeral Trust is taxed, like any other investment, at 33% as Trustee income. These earnings don’t need to be declared in your tax return as income.