What is a Funeral Bond and Why Use One?
Funeral Bonds are a financial investment which can only be used to pay for the funeral of the account holder. Bonds can be taken out before the account holders passing and cover the financial element of a funeral.
Because only the financial element is covered by a bond, Stan Crapp Funerals recommends that it be paired with pre-planning a funeral. This covers most of the funeral preparations and offers the best peace of mind.
Bonds have 3 major advantages:
- A Funeral Bond is an investment which gains interest over time
- Bonds do NOT count towards the pension Income and Assets Test
- Bonds are more flexible in terms of options
Because a Funeral Bond is locked in and cannot be withdrawn, the financial company uses the Bond to invest and accrue interest on your behalf. For up to date information on interest and returns, speak to your Funeral Director or contact our office.
The interest gained on these bonds can fluctuate and is not guaranteed to match changes in the cost of funerals or inflation however.
We recommend that you consider this before taking out a Funeral Bond. Our Team is available to assist you as well.
Aged Pension Exemption
The main appeal of a Funeral Bond is that they can be exempt from the Income and Asset Test, used by Centrelink to determine the Aged Care Pension. Independent financial advisers may recommend that you take out one of these bonds for that reason.
In order for a Bond to NOT be counted in the Aged Pension, it must be assigned to a Funeral Director, Stan Crapp Funerals, and the amount must be below the Funeral Bond Allowable Limit.
For more information on the Income and Asset Test please refer to Human Services.
The Australian Securities and Investments Commission also has more information regarding the Aged Pension and Funeral Bonds.
Paying a Funeral Bond can be quite a large investment and for that reason having appropriate security is essential. Stan Crapp Funerals will assist you in preparing the Bond, but the sum amount is entrusted to an independent financial institution. This is in order to protect you, your bond and ensure that it is invested and handled by financial experts.
Stan Crapp Funerals has partnered with the Australia financial company, Foresters Financial. Foresters Financial originated in Australia in 1849 and is currently based in Melbourne, Victoria. As an established company which operates under Australian Commonwealth financial law. This ensures that your Bond is invested securely and fairly.