PreArrangement Subpage

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PreArrangements - FAQuestions

Ocean Grove Memorial Home
118 Main Avenue, Ocean Grove, New Jersey 07756

Thomas J. Saragusa, Manager
N. J. License No. 4036

VOICE 732-775-0434 - - OGMHognj@aol.com

Not sure about the safety of prearranging and prepaying?

Ask yourself these questions:

When I want to create a Prepaid Funeral Contract, with whom should I deal?

Under New Jersey State statute, the only person authorized to arrange an at-need funeral or a prepaid funeral contract is a licensee (of the New Jersey State Board of Mortuary Science which is a division of the New Jersey Division of Consumer Protection) who represents a funeral establishment licensed and approved by the same Board of Mortuary Science. Telemarketing and “Door to Door” preneed sales are prohibited in New Jersey.

Have I discussed the details of my arrangements and contract with a counsellor licensed by the state? Have I investigated the reputation of the firm with whom I am making this future service contract?

The Ocean Grove Memorial Home is an independently owned funeral home licensed by the State of New Jersey...we are NOT affiliated with a corporate funeral home holding company nor are there any undisclosed ownership ties. The funeral home was established in 1956 by William P. Walton, Jr. and now employs two funeral directors, both licensed by the State of New Jersey: William P. Walton, III - License #2875, the Senior Director, and Thomas J. Saragusa - License #4036.

“Ocean Grove Memorial Home” is a trade name owned by Farry Memorial Home, Inc. which is in turn owned by Mr. Walton, the majority stockholder and Mr. Saragusa, the only other stockowner.

Have I been provided with a detailed printed price list for all services and merchandise, before I made my selections?

The Federal Trade Commission and the State of New Jersey both require that all funeral homes and funeral directors provide a printed General Price List along with a printed Casket Price List and a printed Outer Burial Container Price List to anyone with whom they discuss (in person) prices, terms or conditions of a funeral, prior to such discussion and prior to the presentation for sale of funeral merchandise.

Have I been provided with a detailed (itemized) written statement of all services and merchandise that I have chosen to purchase?

The Federal Trade Commission and the State of New Jersey require that all funeral homes and funeral directors provide a written estimated Statement of Funeral Goods and Services to the arrangor at the conclusion of the funeral arrangement conference and prior to payment being due.

Am I being forced to purchase services or merchandise that I don’t want?

The Federal Trade Commission and the State of New Jersey prohibit tying the required purchase of (any) service or merchandise to the provision of other services or merchandise except that the Basic Services of the Funeral Home may be designated as “non-declinable.”

In addition, the State of New Jersey requires the provision of certain services (under specific conditions) which you may have to pay for if those conditions exist. You are not required to purchase services or merchandise that you don’t want, unless required by law.

What happens if I move away from the area of service of the seller?

Under New Jersey State statute, a Revocable Prepaid Funeral Contract may be terminated at any time by the owner of that contract, whereupon all trusted funds, including the principal and all accrued interest, must be returned to the payor.

Funeral directors licensed by the State of New Jersey may perform their services throughout the entire state. For services required outside of the State of New Jersey, the Ocean Grove Memorial Home belongs to several national associations and is able to contract for required services to be provided by funeral homes and funeral directors licensed by their respective states. Although we can’t always provide the service ourselves, there is no limitation to the area wherein we can arrange for services to be provided. Our “local” area is defined as covering most of Monmouth County and specifically being within 15 miles of the funeral home. Additional charges may apply for services to be provided if death or final disposition is beyond the local area.

What if the merchandise I selected is no longer available at the time of need?

If merchandise selected in a prepaid contract is not available at the time of need, we will either provide other merchandise of like quality and value or under New Jersey State statute, the person then in charge of the arrangements may change the selection and receive a direct adjustment to the final amount charged by the funeral home.

When are funds available?

Immediately upon proof of death - they are wired from the New Jersey Prepaid Funeral Trust Fund’s Cash Management Account directly to the funeral home’s operating account upon appropriate application by the funeral home and proof of death. If the decedent was a recipient of SSI or Medicaid, the funeral home must document it’s charges to the NJPFTF which will transfer the proper amounts to both the funeral home and all excess funds to the State of New Jersey. If the decedent was not a recipient of SSI or Medicaid, all the funds are transferred to the funeral home to be distributed (to the estate of the decedent).

If I choose to revoke my prepaid contract, what percentage of the principal and interest will be refunded to me?

Under New Jersey State statute, the owner/payor of a Revocable Trust may revoke the prepayment contract at any time and receive a full refund of all monies paid (the principal) and, in addition, all interest that has accrued in the trust fund.

However, if the funding trust is an Irrevocable Trust, the details and conditions of the arrangements may still be changed but the owner may not recover the principal or interest which must be used for funeral expenses. All excess funds remaining in the trust will be paid to the State of New Jersey (except if the irrevocable trust was formed prior to March of 2000 or the decedent wasn't receiving funds at the time of death, whereupon excess funds will be refunded to the payor or to the estate of the decedent if the payor is deceased).

Have I been informed of all the advantages and disadvantages of both revocable and irrevocable trusts and when each type is required or indicated?

Under New Jersey State statute, all prepaid funeral trusts must be “revocable” except for Supplemental Security Income or Medicaid recipients because Medicaid and SSI regulations require that revocably trusted funds be counted as an asset. Conversely, irrevocably trusted funds are not counted as an asset by SSI/Medicaid and therefore may be maintained for the payment of “funeral” expenses, however, at the death of the intended funeral recipient, trusted funds in excess of the amount of the final funeral statement are automatically paid to the State of New Jersey by the “trust.”

Have I been informed as to whether or not the contract may be revoked and under what conditions I can change the details and conditions of the contract if it can’t be totally revoked? Can the funds be transferred?

Under New Jersey State statute, a Revocable Trust may be terminated at any time by the payer (owner of the trusted funds) whereupon all funds in the trust will be returned to the owner and, in addition, if it is not revoked, the person in charge of the “funeral” arrangements may change the details of the services and merchandise to be provided by the funeral home either prior to or after the death occurs, and the funeral home must refund excess funds to the payor or to the estate of the decedent if the payor is deceased...the funeral home may not keep any funds to which it is not entitled.

Under New Jersey State statute, an Irrevocable Trust may only be revoked and refunded with the permission of the SSI/Medicaid authority, however, the details (including the designation of the provider...the funeral home) may be changed at any time, i.e., the arrangements may be transferred to another funeral home, either before or after the death occurs (they may not be transferred to another person, though) and no refund will be made to the payor nor to the estate of the decedent, but rather will be paid to the State of New Jersey.

Will 100% of the funds I pay be placed in trust until the time of need?

Under New Jersey State statute, all prepaid funeral funds must be placed in trust with a federally insured fiduciary and all interest must accrue to the interest of the trust. Many other states do not require 100% trusting and most don’t require that all interest accrue to the benefit of the payor.

Have I been informed where and when the funds I prepay will be invested?

Under New Jersey State statute, all funds must be forwarded for deposit within 30 days of receipt by the funeral home or funeral director. The Ocean Grove Memorial Home participates with the New Jersey Prepaid Funeral Trust Fund (NJPFTF) which is administered by the New Jersey State Funeral Directors’ Association. All funds received by the NJPFTF are immediately placed in a Cash Management Account (currently held in the Summit Bank - 2001) and ultimately placed in large value Certificates of Deposit which are purchased through a bidding process...thus, the funds are held by a variety of federally insured fiduciaries. Currently CDs valued at more than 200 million dollars are controlled by the NJPFTF.

The Ocean Grove Memorial Home never places any prepaid funeral funds in its own operating account. (Examine the endorsement on your cancelled check.)

Will I continue to be informed of the status of my funds as time goes on?

The funeral home is required to notify the owner of all trust funds of the amount of taxable interest earned by the trust by January 31st of each calendar year. You will be contacted annually with information about your preneed trust.

Have I been informed who will be responsible for any taxes due on the interest that accrues?

Trust accounts opened with the NJPFTF are deemed “Grantor Trusts.” The NJPFTF charges a fee to administer the trust and credits only the net interest in the individual’s actual trust account. Under federal income tax laws, the owner of the funds...the person whose Taxpayer Identification Number (SSN) is associated with the trusted funds...is responsible for any federal or state income taxes which may be due on the total interest earned annually...the net amount plus the amount charged as the administration fee (except in specific accounting circumstances). As a general rule, because of low gross income, no tax is due on interest accrued in irrevocably trusted accounts.

Have I been informed to what extent the prices of the services and merchandise are guaranteed and if they are not guaranteed, who is responsible for paying any additional amounts that may be due at the time of need?

Because the Ocean Grove Memorial Home can’t control all factors that determine funeral prices, it only participates in Non-Guaranteed Prepaid Funeral Trust Agreements, i.e., we do not guarantee that prices estimated for prepaid funerals will not increase through inflation. The estate of the decedent or another concerned individual may assume responsibility for any additional amounts that may be due at the time of need.

Have I been informed (if the prices are not guaranteed) how my funds will keep pace with inflation?

Historically, since 1981 when the NJPFTF was instituted, accrued interest has kept pace with inflation in all cases that the full amount of the estimated funeral was placed in trust at the time the estimate was made...most usually, a refund of excess funds has occurred. Changed arrangement details, especially additionally ordered items of service or merchandise, will affect the amount of the final funeral statement and therewith the amount of excess funds, if any. Annually, an income statement is sent to the owner of the trusted funds (or his representative) disclosing pertinent financial data along with a statement of how the trusted funds compare with current estimated funeral costs.

Do I get 100% of the value of the interest that accrues in the trust between the time of deposit and the time of need?

Under New Jersey State statute, all interest earned by the trust accrues to the interest of the payor/owner. The funeral home realizes no income due to accrued interest.

Have I been informed about what happens to monies in the trust that are in excess of what is needed at the time the trust matures? (Who receives excess funds?)

Under New Jersey State statute, all excess funds in a Revocable Trust must be refunded to the payor or to the estate of the decedent if the payor is deceased. All excess funds in an Irrevocable Trust are automatically paid to the State of New Jersey by the NJPFTF.

To whom do I make my check payable when I prepay a funeral? Who gets the money?

After you complete the underlying discussion and selection of your unfunded funeral arrangements and then decide that you want to fund the contract, the funeral director will review and discuss all your payment alternatives and advise you accordingly. Ultimately, and only with your approval, it will prepare the proper forms and documents that are needed to open a prefunded account in your name.

The specific procedure is that you appoint the manager of the funeral home as your “trustee” and thus establish an initial funeral trust, the OGMH PRE-ARRANGEMENT TRUST #_____...the funeral home then becomes your agent and endorses your check to the NJPFTF as “purchaser.” All correspondence generated by the NJPFTF is sent to the funeral home (acting as your agent) which will contact you only as necessary. Any time you have a question about your trust fund, you should contact the funeral home which will act on your behalf and solve the problem that you have posed.

Your check should be made payable to the “Ocean Grove Memorial Home.” It will be endorsed to the OGMH PRE-ARRANGEMENT TRUST #_____ AND THE NJPFTF and again endorsed by the OGMH PAT to the NJPFTF for initial deposit in an insured bank. The funeral home never deposits your check in its operating account...the actual funds are always placed in an FDIC-insured banking institution.

Have I read the contract carefully? Do I understand the arrangements fully? Has someone else, whom I trust, reviewed my arrangements prior to me making a final commitment and payment? Have all my questions been answered satisfactorily?

If you have any unanswered questions about your unfunded funeral arrangement or Prepaid Funeral Contract (Trust Fund) please contact the Ocean Grove Memorial Home at 732-775-0434 or via OGMHognj@aol.com.

Alternatively, you may contact the New Jersey Prepaid Funeral Trust Fund at 800-286-3628 or the New Jersey State Funeral Directors’ Association at 800-734-3712 but they won’t know about your individual funeral arrangement details...they will only be aware of the financial facts.

Have I been given accurate copies of all the forms that I have signed? Do I understand the value (or non-value) of the paperwork that I have been issued? What happens if I lose the papers associated with my contract and prepayment.

Under New Jersey State statute, all contracts and forms presented for your signature when you arrange for a Prepaid Funeral Contract must be completed before you sign them. Additionally, you must be given copies of the documents you and the funeral director have signed.

Those documents are merely copies...the funeral home will retain the originals and can make additional copies if you lose or misplace your copies. Additionally, the Ocean Grove Memorial Home will correspond on your behalf with any representative that you designate and with any county, state or federal agency that requires information about your account.

Have I appropriately informed others of the prepaid plans that I have completed?

You should notify all concerned individuals of both your funeral plans and any prepaid contract that you have established. If you live in an administered care facility, be sure that they are aware of your funeral arrangements along with any changes you make from time to time.

Is there a model Pre-Need Law?

It’s a figment of one’s imagination to think a national “model law” actually exists but several organizations, such as the American Association for Retired Persons (AARP) have suggested that PreNeed Laws should provide certain safeguards to all citizens. The statutes currently in effect in New Jersey follow the proposed safeguards that have been proposed by both the AARP and the National Funeral Directors’ Association. Along with New York State laws, New Jersey’s preneed statutes are considered the most consumer protective of all the 50 states.

Remember, if a contract seems, “Too good to be true”
. . . it probably is.

If you have not been provided with an appropriate explanation or answer to all of these questions, you should ask for additional information before you prepay your funeral arrangements.

Links to SECONDARY PAGES in this Master PreArrangement Partition:

Philosophy - PrePayment - SSI/Medicaid - Trust Funds - Sure Trust - Organ Donation

Back to the PreArrangements MASTER Page - Site Table of Contents