Not exactly a cheery heading, we know, but a question well worth asking, especially with funeral costs far out stripping inflation. Since 1980, the average annual increase in funeral costs has been 6.1%, compared to an average annual inflation rate of 4.0% (as measured by RPI).
And Sun Life’s annual Cost of Dying report for 2015 highlights that the cost of a basic funeral now stands at £3,693 - an increase of more than 90% in the last decade.
So, exactly how much does a funeral cost?
If the average cost of dying continues at the same rate, then, as our blog from last month highlighted:
- if you die in 2021, your family could pay £4,827
- if you die in 2036 (so 20 years’ time), your funeral costs could be £11,733
You can also use our funeral calculator to see what funeral costs could be in the future. This will help you decide whether you need to make arrangements that take into account funeral inflation rather than relying on your savings to cover them.
Basic funeral costs
Remember, these are just the average costs of dying to cover off all the necessities, such as funeral director’s fees and disbursements. Optional extras such as flowers and funeral cars will typically add more on to these costs.
In fact, over the last 5 years, in the UK we have spent £4.8 billion on funerals, with £1.6 billion of this being borrowed. Payday loans account for £576 million worth of the debt, with bereaved families also taking out personal loans, paying for a funeral on a credit card, or borrowing from friends and other family members.
This all makes for rather worrying reading, so what can you do to protect those you leave behind from ever-increasing funeral costs?
Prepaid funeral plans
One popular option is a prepaid funeral plan. This basically does what it says on the tin - you pay upfront for your funeral costs (typically ranging from £3,400 to over £4,500) in one lump payment or spread over 2 – 30 years. The funeral director’s costs are guaranteed to be covered when you die.
This is a way to secure your funeral director’s costs at today’s prices. Some prepaid plans also guarantee your cremation and minister’s fees, too.
You can read our Guide to prepaid funeral plans here for more information.
Over 50’s life insurance
Another way to help your family now with funeral costs when you die may be with an over 50’s life insurance plan. Often promoted as a funeral plan, this is actually a life insurance policy that pays out a cash sum when you die and which can be used to pay towards the cost of your funeral services.
At the time of writing, payments start from £10 a month. You can find out more about Over 50’s life insurance here.
Of course, you may wish your family to do as Mr. John Wright of New Milton, Hants, did in June this year. When he was told it would cost £5,300 to give his late mother, Lady Margaret Johnson, a proper send-off, he decided to lay her to rest in his back garden.
According to The Telegraph newspaper, it is legal to bury someone on private land in the UK provided the person doing so has permission from the landowner and the General Register Office (the Government body that records births, deaths and marriages).
If you have a mortgage you may typically need permission from your lender. They may have reservations, as when it comes to selling the property, potential buyers may be put off by the fact there is a body buried in the garden.