Funeral costs are rising, so don't let it become a burden
We all know that one day we will need a funeral, but what we don’t know is how much it is going to cost. The average price of a funeral is now £3,785* and rising. For many families this can become a great burden at such an emotional time.
Sadly, there are many people who are unable to pay for the cost of their loved one’s funeral and often have no choice but to take on a large loan to do so - £1,990 on average. This is now at a record high, with 13% agreeing to pay a funeral director over a period of time, 20% borrowing from friends and family, 7% selling possessions and 27% taking out some form of credit.
Although the State does offer some help, it is nowhere near enough. On average there is a shortfall of more than £2,300. In addition, the waiting times for application approval for state support can also be extremely long.
What is worth knowing is that there are still ways to plan ahead for your own funeral. One way is by taking out a funeral plan.
A funeral plan guarantees to fix the cost of a cremation funeral and protects against the rising costs in the future. The costs covered generally include the provision of a coffin, hearse and limousine, cost of cremation, minister and officiant’s fees. Many funeral plan providers include different options with flexible payment facilities, for example over 12 months or 5 years and some will offer a contribution towards a burial rather than cremation.
A funeral plan not only protects your family from meeting the burden of funeral costs, it will also sit outside of your estate for Inheritance Tax assessment, the money is completely protected through the National Funeral Trust and will pay out even if the plan holder’s assets are frozen on death.
If you would like more information on funeral plan provision, or any other aspect of financial advice please contact me.