The costs of a funeral are some of the few bills we can’t predict in our lifetime. Transparency is important – I can’t tell you how much your funeral will cost.
What we can all do, is decide how long our mortgages should last, and how much we’ll pay in interest. We can set our own retirement dates, and choose whether or not to draw down from our pensions. But we can’t tell when we’ll need to pay for a funeral and what it will actually cost.
That puts financial pressure on our families.
Nobody knows exactly how much a funeral will cost, in total, until the time comes. This is because it’s up to you and your family (and me, and mine), what kind of funeral we’d like.
Many families want to celebrate life in a unique or memorable way, and why not. The choices are greater than ever before. A funeral might involve elaborate planning to reflect a person’s life – a horse drawn carriage and personalised floral tributes for example, or catering and an event for a large number of people. Or a funeral may be very intimate and focused, perhaps with a burial that has a more modern feel to it. All of these choices involve what we call ‘discretionary costs’ – the personal touches that make it your family’s event, nobody else’s.
MAKING A PLAN
At both ends of the spectrum, some costs are almost unavoidable: a funeral director’s fees (covering the cost of an experienced team that helps your family make practical arrangements) and the disbursements (the unavoidable charges for being buried or cremated). That’s where funeral planning makes financial sense.
In the same way it makes sense to pay for a mortgage fee up-front, instead of adding it to your mortgage and paying interest on it over many years, it makes sense to pay for the most basic costs of a funeral today. This way, you’re investing in two firm guarantees that both give your family a financial advantage in the future.
The first guarantee is that, by making financial plans for a funeral in advance, there’s no need to worry about paying for the most basic parts of a traditional ceremony: the funeral director’s fees and the disbursements. This means your family has more money available to spend on the personal touches that matter so much.
The second guarantee is that, when the time comes, even if funeral directors’ costs have risen with inflation, those same costs can still be met. What’s more, by paying in advance using a funeral plan, your wishes are easier to understand and to share among your family.
Good financial advisers believe in holistic financial planning. They look at every aspect of clients’ lives and finances, what they think of risks, and what they’d like to achieve with their money over a specific period of time. I believe funeral planning should play just as an important part in that process. Funeral plans – any kind of end of life planning – can greatly reduce the risk of distress, and at the same time increase the amount available for your family to spend on personal touches.
End of life planning should always be part of life. I’d love to hear your views.