Key Things to Remember Before Making Any Final Decision
- Celebration of life is simple
- Funerals are traditional
- Celebration of life, our personal and flexible
- You can borrow against whole life insurance
- You cannot borrow a term life insurance
- Policy loans can reduce your death benefit if unpaid
Planning for the end of life is never easy for most of the families. When someone close passes away, you’re not only dealing with stress but you also have to make important decisions. There are so many families who are thinking about the celebration of life vs funeral options, and think which option feels right. At the same time financial questions often come up in their mind, like can you borrow against life insurance to help to cover the costs?
If you understand your choices then you will have some difficulty. In this guide, we will explain everything in simple, clear language. You will learn the real differences between a celebration of life vs funeral. You will also get to know about how borrowing against the life insurance works and what you should know before making any decision.
What Is a Traditional Funeral and How Does It Work?
Funeral is a ceremony that is held after sometime when someone passes away. The funeral includes a viewing or visitation, a religious or spiritual service or cremation, and the traditional music or reading.
Funerals can often follow the cultural or the religious customs. They are usually more structured, and they can feel serious and emotional.
What Is a Celebration of Life
On the other hand, talking about celebration of life, so it is a more personal and flexible event. This focuses on remembering the person’s life rather than mourning their death. There are some of the common features that include.
- Sharing happy memories
- Playing favorite music
- Displaying photos and videos
- Casual dress and relaxed setting
Celebration of Life vs Funeral – 5 Differences You Must Know
Here are the main differences between celebration of life vs funeral. Let’s have a quick look.
Tone
The tone of funeral is formal and traditional while the celebration of life is positive and uplifting.
Timing
The funeral is usually within a few days while the celebration of life can be held later or whenever the family wants
Structure
The funeral is a religious or cultural structure. On the other hand, the celebration of life is flexible and personalized.
Location
Funerals can be held in church, funeral home or cemetery. While celebration of life can be anywhere meaningful.
Cost
The cost for both is different, but keep in mind that celebration can cost you less depending on your arrangements.
How To Borrow Against Life Insurance
Whenever families face funeral or memorial expenses, they often ask about borrowing against life insurance for celebration of life vs funeral ceremonies. The answer totally depends on the type of policy you have.
You can borrow against life insurance if you have a whole life insurance, universal life insurance, or variable life insurance. All these plans are called permanent life insurance policies because they build cash value over time. You cannot borrow against most term life insurance policies.
Can You Borrow Against Term Life Insurance? Important Facts Explained
The answer is very simple that is no. Term life insurance does not build any cash value. It only provides a death benefit. Since there is no saving portion and there is nothing to borrow from If your policy is term life, then borrowing is not an option.
How to Borrow Against Whole Life Insurance Step by Step
If you have a whole life insurance policy you can be able to borrow against whole life insurance once it builds enough cash value.
You can borrow if the policy has built, cash value, if the insurance company allows the policy loans or if you have enough available value. A whole life insurance policy slowly grows a saving component. You can use that value collateral often for a loan.
How Much Does Life Isurance Cost?
Can I Borrow Against My Life Insurance Policy? What to Check First
If you’re thinking about how to borrow against his life insurance, then he is a very basic and a simple process that you have to follow
- First, you have to contact your insurance company
- Ask how much cash value is available
- A policy loan request
- Receive funds that are often tax-free.
What Happens When You Borrow Against Your Life Insurance Policy – Important Points
Before you borrow against your life insurance policy you have to consider these points
- Policy loans usually have interest. If you do not pay the loan, then the balances will grow.
- If you pass away before reaching, then the unpaid loan is detected from the payout
- There is no credit check, this is one of the best benefit
- Most of the time you do not get any fixed repayment schedule
Borrowing Against a Life Insurance Policy: Pros and Cons Made Simple
| Pros | Cons |
| Fast access to money | Reduced death benefit |
| No loan approval process | Risk of policy lapse if loan grows too large |
| Lower interest than many personal loans | Interest accumulation |
Can You Borrow Against a Whole Life Insurance Policy for Funeral Costs?
Yes, you can borrow but in a condition If you have the permanent life insurance with cash value, you can use it to cover a funeral or celebration of life expenses.
However, there are some families who prefer to use savings, use final expense insurance and also use prepaid funeral plans. All these things totally depend on your financial situation.
Financial Planning Tips When Choosing Celebration of Life vs Funeral
Whenever you are comparing celebration of life vs funeral, the financial planning plays a very important role.
The traditional funeral can involve casket, embalming, burial plot and headstone.
Why celebration of life can include your rental, catering, printed programs and memorial videos.
Life insurance is often used to cover all these costs. Understanding if you can borrow against a life insurance policy will give families more flexibility during the difficult time.
Final Thoughts
Choosing between a celebration of life vs funeral totally depends on the personal needs, your cultural values, and your budget. Both of these options are good and the best way to say goodbye to a loved one in a meaningful way. At the same time, understanding borrowing against life insurance gives families financial options during the emotional times. Permanent life insurance can offer flexibility through policy loans, but it must be used wisely. Just make sure that you always review the terms very carefully and consider long-term effects before borrowing.
Planning ahead makes everything very easy. Talk to M-life Insurance experts today and explore the right life insurance coverage for your family and get the financial peace of mind you deserve.
FAQS
No, celebration of life vs funeral are not the same. A funeral is usually more formal and traditional. It can follow religious customs that focus on saying goodbye. While celebration of life is more relaxed and personal. It focuses on happy memories and honoring the person’s life in a positive way.
Yes, you can. This is all about what you want if you do not have to arrange a funeral, there is no need to arrange. There are so many families who are choosing celebration of life because it feels more personal and positive. But whatever you want it always depends on your loved one’s choices and the thing that you are comfortable with.
A celebration of life usually happens after the person’s death. It can replace a funeral or happen after a funeral. There is no strict rule. It can be held days, weeks or even months later after the death.
There are some other names that are used for celebration of life;
Memorial service, life memorial, remembrance gathering, and tribute service. All of these mean a special event to honor and remember someone.
You can choose a celebration of life when you want a more positive goodbye,and also when you want to prefer something simple instead of the formal traditions.
Joyce Espinoza, Expert Life Insurance Agent
Joyce Espinoza is a trusted life insurance agent at mLifeInsurance.com. She’s been in the insurance industry for over ten years, helping people, especially those with special health conditions to find the right coverage. At MLife Insurance, Joyce writes easy-to-understand articles that help readers make smart choices about life insurance. Previously, she worked directly with clients at Mlife Insurance, advising nearly 3,000 of them on life insurance options.
