How to Guard Against Future Funeral Cost Increases

Posted by on Dec 12, 2013 in Pre-Paid Funeral | Comments Off on How to Guard Against Future Funeral Cost Increases

How to Guard Against Future Funeral Cost Increases
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Where you had paid for an average funeral in 1990, the cost will have been around £850. By 2025, the average funeral expenses are expected to set you back around £2,700, plus expenses.

If you had purchased a Pre-Paid Funeral Plan back in 1990, you would have saved around £1,850, if the plan was used in 2005.

That is a better yield on your money than an investment in a building society savings fund, over the same period of years.

The inflation rate for funerals has tended to run at a much higher rate than general retail price inflation for many years.

To try and save against the effects of inflation, you can purchase a Pre-Paid Funeral Plan. This means that the price you pay today, guarantees that you will pay no more for all the funeral director’s activities involved in the funeral and service. However, you should note that an amount of what you pay now, is set aside and will rise in value with the value of the funeral trust fund and is used towards the items that you cannot guarantee the cost of;- the cost of your cremation or burial; your doctor’s fees and that of your clergy.

In their Cost of Dying report for 2013, Sun Life Direct has quoted funeral costs increasing 80% since 2004. They state that the average cost of dying is now £7,622.

A basic funeral has risen 5.3% since last year to a current total of £3,456, which is 80% more than 2004.

Once you add other discretionary expenses such as flowers and a headstone, the average cost of this funeral increases to £7,622, which is an increase of 7.1% over 2012.

These figures show why it’s sensible to purchase a Pre-Paid Funeral Plan today, but it’s best to avoid insurance based plans. They have several disadvantages. Principally they don’t guarantee to cover funeral costs or allow you to specify the arrangements. Even if you are in reasonable health, you may well end up paying much more in premiums than the insurance company will ever pay out.

 

 

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