Planning for the future with funeral plans

When you make plans for the future, you have a much better chance of achieving what you want, without the interference of the unexpected or unwelcome.

Prepaid funeral plans do just that. They provide the reassurance and comfort of knowing that arrangements have been put in hand for the type of funeral you want when you die. But by paying for those arrangements in advance, you make sure that the cost comes as no nasty shock to the relatives who are otherwise left to foot the bill.

How much does a funeral plan cost?

There are many different ways to celebrate a funeral – these may range from the basic to the more elaborate and involve burial or cremation, for example.

The cost may also differ quite widely, depending on the type of service you choose. So, although there is no fixed rate, funeral directors who are members of the National Association of Funeral Directors (NAFD) or the National Society of Allied and Independent Funeral Directors (SAIF) may be relied upon to ensure that you are receiving good value for money by matching costs to services provided.

Rates also vary between different regions in the UK and your choice between burial and cremation.

In their annual “cost of dying” report, insurers Sun Life found that in 2016, the average cost of a funeral directors’ fees was 3,897, but when all of the associated services – such as flowers, memorial stones and a reception or wake – were included, this figure rose to a sizeable 8,802. More alarmingly, said Sun Life, these costs have risen at almost 16 times the rate of inflation.

By the time you eventually die, therefore, funeral costs may have risen far above these figures, leaving a nasty shock for your relatives and considerable financial difficulty in arranging the funeral you wanted.

By paying for the funeral directors’ services now, at today’s prices, you avoid an unknown future in which costs are likely to have outstripped your survivors’ ability to pay.

Who keeps your money safe?

If you are paying for the future services of a funeral director now, you want to be certain that the money continues to be there for use when it is needed.

You might have made your funeral planning directly with the local Funeral Directors, for example. But if that firm goes out of business during the interval between paying for the services and the time of your death, you may face an uphill battle in trying to recover the funds you paid over.

When you deal with a national provider of prepaid funeral plans, however, there is typically more certainty in the funds still being available when they are needed. That security is achieved by the provider placing the funds in an independent trust fund on your behalf – so that it cannot be touched until required for your funeral – or through the purchase of a whole of life insurance policy in your name, which pays out a guaranteed cash sum on your death.