As dreary and uncomfortable as it may be, planning your funeral now can help ease the burden on your loved ones later on in life; your family not only have the burden of planning your funeral, but they can also face the added worry of paying for it.
So are funeral plans a good idea? Here’s what you should know including what’s covered and what’s not, how much you can expect to pay for one and what the alternatives are.
A funeral plan is where you arrange and pay for your own funeral before the event so that when the time comes a plan can:
* Note: prepaid funeral cremation plans and associated costs are usually completely covered whereas burial plans will very often not include cover for the cost of a plot or a headstone.
What’s covered varies between plans and can include:
Note: Joint funeral plans for couples who want to protect a surviving partner from arranging or paying for their funeral will only cover the cost of one partner’s funeral, not both.
The following typically isn’t covered by a prepaid plan:
*You can leave what is called a ‘letter of wishes’ with your Will although this is not legally binding. To save costs and time (and being exposed to Covid-19!), you can now easily write a Will online.
How much a funeral plan costs will depend on what you want to include in your plan, the plan provider’s fees and your geographical location.
To get an idea of costs, you should shop around and compare quotes for funeral plans.
To give you some idea of costs, take a look at prepaidfuneralplans.co.uk’s website to see what they consider to be the:
The average funeral in the UK costs around £4,417 and is expected to increase to around £5,285 within the next few years.
According to ukcareguide.co.uk, back in the year 2000, the cost of a funeral was a lot less than it is today, averaging at around £1,500 to £2,000.
The great thing about a funeral plan is that the fee that you agree to and pay for when you take a plan out is fixed meaning you (or your loved ones) won’t have to pay more at whatever age you pass away.
The average cost of a prepaid funeral plan in the UK can cost anything from approximately £3,000 up to £5,000 or, for a cheaper [basic] plan that includes a simple cremation and no ceremony, from £1,300 to £1,800.
Whether or not you need funeral insurance is a personal choice so to help you decide, we’ve rounded up the pros and cons of getting a funeral plan:
Benefits |
Risks |
| Funeral insurance payments are inflation-protected, meaning that even if the cost of funerals continue to rise (which they have done, historically, year on year), your plan won’t be affected and you should still receive the same service, coffin, etc, for the money you paid. | On the flip side, if the cost of a funeral decreases (the Competitions and Markets Authority “continue to actively monitor price trends in the funerals sector” and could decide to cut funeral costs), then you could end up paying too much by paying in advance. |
| You make most of the funeral arrangements yourself (like whether you want to be cremated, what coffin you’d like, etc) meaning there’s less for your family to worry about, arrange, decide on and pay for. | A plan will only cover certain funeral costs so if you don’t have any cash in the bank or valuable assets, meaning your family can’t claim back any additional costs from your estate, then they will be left to foot the bill. |
There’s no ‘one size fits all’ when it comes to a plan provider so you should shop around, compare quotes and read the small print of a plan before deciding.
To get you started, Which? provides a comprehensive list of funeral plan providers in the UK on their website who are all registered members of the Funeral Planning Authority and whose plans all cover the costs of:
Alternative options to a funeral plan can include:
A popular way for over 50s to pay towards their funeral costs is by taking out an over 50s life insurance policy. However, these insurance policies, just like plans, rarely fully cover the cost of a funeral.
Read more: Over 50s life insurance explained
Many people take out whole of life insurance to cover the cost of their funerals as this type of life insurance pays out at whatever age you die, unlike a term life insurance policy which can expire before you pass away.
Read more: Why do people buy life insurance?
Perhaps the least desirable option because the cost of funerals can continue to rise every year and the amount of interest earned on savings (especially in the current climate!) may not cover those increased costs.
For more advice on funeral plans and insurance, including the pros and cons of a funeral plan vs whole of life insurance, check out our related articles below.