The cost of dying is increasing, with the average UK funeral now costing just over £4,000. So, while thinking about your death may not be the most cheery of thoughts, with ever-increasing funeral costs, many people are now forward-planning, so that when they die, those they leave behind won’t be left with a financial burden.
Pre-planning for how the costs of your funeral will be covered can make financial sense. Of course, you could put some money away every month – though whether there will be enough to cover your funeral expenses remains to be seen. Another option may be to consider a prepaid funeral plan.
Here, we describe a bit more about prepaid funeral plans and why they may be suitable for you.
What are prepaid funeral plans?
A prepaid funeral plan is designed to be an easy way to plan ahead. You simply choose the funeral plan you want and pre-pay for the cost of your funeral and other associated costs. This in effect, freezes the cost of your funeral at today’s prices.
With the cost of dying rising twice as fast as the cost of living, prepaid funeral plans can be an inflation-beating way to secure your funeral costs.
You should note that prepaid funeral plans differ among each other, and while some guarantee to cover all the costs of your funeral, others will only guarantee to cover the funeral director’s costs – therefore it is essential you understand what the plan entails.
How do they work?
There are a number of prepaid funeral plans on the market, offering different levels such as Budget, Mid-Range etc. This means that you can choose the plan that most suits your budget.
Typically, you choose the funeral plan that you want and pay for it anywhere between one – 25 years (typically going up in five-year increments). At that time you can decide precisely what coffin you want, the music played at your service (if you wish to have a service) and so on.
What are the benefits?
Apart from the peace of mind that you are taking away the emotional and financial burden from your loved ones when you die, you are saving money, as you are paying for your funeral costs now.
What is the difference between a prepaid funeral plan and an over 50’s life insurance plan?
Over 50’s life insurance is often touted as a funeral plan, but it is, in fact, a life insurance policy that pays out a pre-agreed amount when you die. The proceeds of the policy can be used towards funeral costs or maybe to leave a small legacy to your loved ones. It does not, however, guarantee to cover all your funeral costs.
With a recent news report stating that around one in six Brits will struggle with funeral costs, it may make sense to start looking for a funeral plan now and save your family from financial distress when you die.