Can't decide which is the best way to handle this, we would like to open up a savings account to contribute money into it every month, so when the time comes, we would have the money to pay for aging parent's burial cost. Should we open the account under parent's name with any or all of us as the benefiaries, or under any of our name with the rest siblings as benefiaries or under all of our names with parent's as the benefiary? What's the correct way to do it? We trust each other, so it's not really the issue. Thanks.
Answers
Do not open under your mother's name, or your father's name, unless some of their own money will be contributed to the account. With them on the account at best, when they pass away, you will have to deal with a POD situation. At worst the account might even have to pass through probate!!
You do not say how many children there are. If it is not too many, and if all will be contributing to the account equally, then I would just open in the names of all the kids, without naming a beneficiary. And even though there is trust you might want to stipulate that, for withdrawals, the permission of all owners is required . . . . . if such a stipulation is allowed.
I have nothing to add to my earlier comments, other than to say I think it would be risky to name a funeral home as the beneficiary. Funeral homes go out of business. Also, the funeral home would probably want to be paid right away -- they wouldn't want to deal with having to go to a bank to collect their fee.
You might want to consider a pre-paid funeral (something I am generally not in favor of, except for purposes of protecting assets from nursing homes, or in cases where family members/executors might not carry out the wishes of the deceased.)
As to Kaight's comment, which I think was well thought out -- I believe Kaight may not have considered one (probably unlikely) possibility, when he recommended that you do not name a beneficiary -- what if all the children predecease the parent? Having one or more beneficiaries on the account might be helpful in that situation.
I have no recommendation to make to you, other than that you should consider all contingencies before making your decision.
Take the situation of a parent who's 85 years old, with 3 children in their sixties. The odds of the parent outliving all the kids are quite low, but I suspect that it's more common than winning the lottery.
I'm not saying that this contingency should determine (or even be a major factor) in the decisionmaking. But it's worth considering, even if the children don't travel together.