A prepaid funeral policy can help keep funeral costs down to an affordable amount. It can also ensure your funeral is how you want it to be. And that it is paid for by you. The last thing you need in your latter years is the worry of burdening family members with funeral costs. Like everything in life, the cost of a funeral is rising. It may seem ironic, but the cost of dying is actually constantly rising.
The cost of complete funerals is rising. Far faster than inflation and it is leaving bereaved relatives facing bills they cannot afford to pay. Figures from Mintel’s Funeral Business Report show just how much funeral costs have risen. In 1988, the average cost of a funeral was 716 pounds. By 1997, less than a decade later, it had risen to 1284. By 2006, it had spiraled out of control to nearly 2.5K. This is approximately 1000 pounds more than if the cost had risen with inflation.
Funerals are big business, but it is heartbreaking to think of how the elderly and vulnerable are being met with funeral costs they cannot afford. This leads to family members suffering decades of debt. The rising number of pensioners living in the UK means that the funeral business is booming. One way to put a stop to this is to take out a prepaid funeral policy. However, you need to be sure what you are signing, and what will be included in your plan. The word prepaid can be misleading, as not all your funeral costs will be covered by your chosen funeral plan.
There are two different types of prepaid funeral policy that you can buy. Some people will invest in an insurance policy as opposed to a plan offered by a private funeral planner. A whole life plan will pay out a fixed amount at the time of death. These plans are not always the best option. As people are living longer, some are finding a situation where they have paid more into their plan than their family will receive on their death. This is why a funeral plan purchased from a funeral director or an independent funeral planner is a better option.
This type of prepaid funeral policy is commonly known as a funeral plan. It will cover most of the elements of your funeral but not all of them. Once again you need to make sure you read the small print to ensure you know what will not be covered. If you are not careful, a burial plot will not be included, and these can be expensive. Not an expense that you wish to leave to your family after at the time of your death. Third party fees such as doctor’s costs and crematorium fees are also rarely included. Others will not include the cost of flowers or a wake.
For these reasons, you need to make a careful choice. If you choose an insurance plan then you know how much money your relatives will receive. This will stop them from getting into debt. But, you may pay more for your policy than your relatives will receive. A reputable funeral planner on the other hand will carefully arrange a bespoke funeral plan with you, showing you just what is included and how much you should set aside for additional costs.