What are funeral plans, Your guide

Funeral plans are just that – a formal expression of the manner in which you want your final wishes to be carried out at your funeral.

More than that, though, the formal, contractual nature of a funeral plan from an accredited provider also gives you the opportunity of paying for those arrangements up-front – payment at today’s prices, rather than the inevitably higher prices that are almost certain to be charged when it comes your time to die.

Why are they important?

Funeral plans give you the opportunity of deciding what type of funeral you want by paying for those arrangements in advance. This also relieves your surviving relatives from some difficult and potentially heart-wrenching decisions if they have to organise, and find the funds to pay for, your funeral.

For some of your relatives – those who may be the last to outlive you – the financial difficulties may be considerable.

The heart-breaking consequences are well illustrated in the course of a feature on “funeral poverty” published by the Independent newspaper on the 15th of April 2017. Faced with a quotation from an undertaker for a funeral package costing £10,000, the grieving brother of the deceased had no option but to decline such an expensive offer, but was left feeling that he had “short-changed” the loved one who had just died.

The cost of dying

That £10,000 quotation from the undertakers cited by the Independent is unlikely to be so exceptional.

In its most recent annual report on the cost of dying in the UK, insurers Sun Life reveal that the average total cost of a funeral package had risen to £8,802 towards the end of 2016 – a figure that represents an increase in prices of some 16 times higher than the rate of inflation.

This total cost was made up as follows:

  • £3,897 for a basic funeral ceremony – the amount you typically pay to a funeral director;
  • £1,976 for the additional arrangements usually associated with a funeral, such as flowers, notices in the newspaper, hire of a venue for the post-funeral reception or wake, the catering services and costs of a memorial stone; and
  • £2,929 for all the various professional services typically by executors in the management of the deceased’s estate – the process of probate, in other words.

Prepaid funeral plans

Prepaid funeral plans have the ability of freezing the costs charged by funeral directors for their services at today’s prices – saving your relatives expenditure of an even greater sum whenever it is that you die.

The money you pay over to a national provider of funeral plans is carefully protected to ensure that the amount you have chosen remains intact. It is either held in an independently-managed trust fund or applied to the purchase of a whole of life insurance policy in the name of the person making the plan.

Nevertheless, it is important to remember that not all prepaid funeral plans offer the same benefits or represent as good value for money in terms of the price that you pay. In order to make a fully-informed and meaningful choice of the plan suited to your particular needs and circumstances, you might want to use the services of a comparison website specialising in prepaid funeral plans.