How to pay for your own funeral

15 December 2020

Paying for your own funeral is not the sort of spending any of us look forward to, but it’s something we all have to consider later in life. Funeral costs are not getting any cheaper and prices can vary substantially depending on where you live in the UK, and whether you opt for a burial or cremation. Average UK funeral costs have risen from £2,971 in 2011 to £4,202 in 20191. If prices keep rising at the rate they did between 2011 and 2019, the average funeral could cost £6,206 by 20282.

Is it smart to prepay your funeral?

Some say it’s smart to prepay for a funeral, while others are happy to stump up the cash through their estate when the time comes. Either way, funerals can be expensive, so it pays to plan ahead and think about how your funeral will be paid for.

Paying for your own funeral may be a significant expense for you to think about covering, especially if you have a more elaborate service in mind or the costs include paying for a burial plot. It's worth trying to estimate what the likely costs will be, and then looking into ways you can begin putting plans in place to help pay them.

 

Can you pay for your funeral before you die?

The short answer is yes – you can pay for a funeral in advance through a funeral payment plan. A prepaid funeral plan is an option for those who wish to pay for a funeral in advance at today’s prices. If you're considering one, ensure you read the information thoroughly as not all UK funeral plans are the same.

 

How does a prepaid funeral plan work?

A prepaid funeral plan will usually cover the essential costs of a funeral director, including the coffin, care of the body, cars and pall-bearers, plus either the cost of cremation or a burial, depending on your preference. It’s unlikely to cover other costs such as a wake, floral tributes or a headstone. Paying for a funeral in advance may tie you to a particular Funeral Director or funeral company, which may become difficult if you move in the intervening years. Also, what’s offered can vary a great deal, so make sure to check that everything you want is covered on any plan you take out.

Once you’ve paid the agreed amount in your funeral payment plan, the parts of the funeral included in the plan are covered when you die. The provider will pay the money straight to the Funeral Director, so your friends or family won't have to get too involved in the financial or administrative side.

You should check that your funeral plan provider is registered with the Funeral Planning Authority – the regulator for UK funeral plans – as 95% of all new funeral plans are registered with them. You won’t pay Inheritance Tax on your UK funeral plan.

 

How much does a prepaid funeral cost?

As a rough estimate, a one-off funeral plan payment could cost you up to £5,000, but you could potentially get a more basic plan for under £3,000. People understandably want to know how much a prepaid funeral costs, but in reality, it depends on whether the size and scale of your funeral and if you’d like to pay a lump sum or monthly instalments – you could expect to pay at least £20 a month.

Alternatives to prepaid funeral plans

 

For many people, the preferred ways to manage the costs of a funeral are to draw upon existing assets, negotiate a deal with a funeral provider, or use Over 50s Fixed Life Insurance for additional support.

  • 1. Use your Assets

    Estate planning and your assets

    1. Use your assets

    If you’re lucky, you’ll have enough money in your estate to cover your funeral costs. If you'd like this money to be used in this way, you should ring-fence it, leaving clear instructions with family members or a solicitor. Remember that if funeral costs continue to rise faster than savings grow, it may be necessary to review and increase the amount set aside. If you feel you need more information, you should seek professional advice.

    Not everyone likes the idea of saving up for an event they won’t get to witness, but if you do decide to pay for your own funeral using our assets, here are some of the potential advantages:

    • You can plan your funeral payments carefully based on your finances, rather than a rushed decision.
    • Your loved ones won’t have to think about funeral costs when they’re grieving.
  • 2. Shop around

    2. Shop around

    If you don’t fancy paying for your funeral before you die, you could always shop around by getting quotes from different funeral service providers, and seeing if you can prearrange a fee, rather than pre-paying. It could potentially be cheaper if you use a national provider, rather than local burial or cremation funeral charges, which vary greatly.

    Senior lady reviewing prices online
  • 3. Over 50s life insurance

    3. Over 50s life insurance

    Over 50s life insurance plans are designed to pay a cash sum to your loved ones that can be used to contribute towards your funeral, unpaid bills or even to enjoy as a gift when you’re gone. Over 50s Fixed Life Insurance is not designed to meet the full costs of a funeral, and does not guarantee to do so.

    Of course, there is nothing to stop you from having a prepaid funeral plan in place, while using Over 50s Fixed Life Insurance to pay for those special extras – from funeral flowers to refreshments at the wake. Your loved ones may wish to spend money from a variety of sources to give you a fitting send-off. And while our Over 50s Fixed Life Insurance can leave your loved ones with money they can put towards the funeral, the cash sum could alternatively be put to other use, such as buying a small gift.

    Find out more about our Over 50s Fixed Life Insurance.

    Grandmother, mother and daughters walking on beach

No one expects paying for your own funeral to be fun, but whichever option you choose, you can enjoy the peace of mind that comes from knowing that you’ll have helped your loved ones by making things easier for them at a difficult time.

1. Independent research by Matter Communications on behalf of Dignity in 2019.

2. 2020 - 2028: Forecast based on average annual compounded growth rate of 4.43% each year between 2011 and 2019

Find out more about our Over 50 Life Insurance