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With the costs of funerals rising faster than inflation, it may make sense to prepay for your funeral arrangements. A study from the University of Bath cites the following:
- On average, the price of a typical funeral is £3,456. This includes non-discretionary fees and a burial or cremation;
- The average amount spent on extras such as flowers, a memorial and catering is £2,006;
- Discretionary estate administration costs have increased significantly, to £2,160.
The report also highlighted how the average cost of dying has risen by 7.1% in the past year to £7,622 (this figure includes funeral costs, burial / cremation costs, plus estate administration). The study’s authors also estimate that over 100,000 people will struggle to pay for a funeral this year alone.
That is why a prepaid funeral may be a consideration.
Why prepay for a funeral?
Not only could this save your loved ones having to find the money to meet the funeral costs at the time of your passing, but it also means that all the arrangements are taken care of. The benefits are two fold:
- You have the peace of mind of knowing that your wishes will be carried out as you want them. These can be as simple as stipulating where you want to be buried or cremated as to you specifying what music you want played, and so on.
- Those you leave behind are not left with decisions to make about your funeral arrangements, which can be especially hard when grieving. Nor will they need to find the money to give you a good send off.
How to prepay for your funeral
If you are looking for prepaid funerals, then there is a selection of providers you can choose from. Typically, how a prepaid funeral plan works is:
- Generally, there are a number of different levels of plan you can choose from – the basic level covers the cost of a coffin, cremation or burial fees, while a superior level generally includes the costs for a high quality coffin, a hearse and two limousines as well as additional benefits. You can choose the arrangements that most suit your requirements;
- You prepay for your funeral;
- You have peace of mind that whenever you do, your funeral costs are taken care of and are inflation-proof.
Payments for prepaid funeral plans can typically be made in a number of ways:
- Via a one off lump sum, typically ranging from £3,125 to over £4,200; or,
- In 12 monthly, equal instalments or, with some providers, over 2 years.
Won’t an over 50s life insurance plan do?
While over 50s life insurance plans are promoted as a way to meet funeral costs when you die, the difference is that your loved ones typically only receive the sum insured agreed at the time you took out your policy. This amount will not be:
- Inflation-proof against the rising costs of getting buried, so may still leave your family out of pocket;
- Available immediately upon your death (it may take a few weeks to make a claim etc. and have it paid), so your family may still have to find the money to pay for your funeral, which could cause financial worries.
In conclusion, if you are concerned how your loved ones will pay for your funeral costs, or want to make sure that your wishes are carried out when you die, then finding out more about prepaying your funeral costs could be the next step.