You’ve probably heard some of your friends or family talking about funeral plans. Are you wondering what all the fuss is about? In this post, find out the pluses and minuses of funeral plans and what they are. Then you can make an informed decision about whether they’re right for you.
What is a Funeral Plan?
A funeral plan is a way of making your funeral arrangements and paying for your funeral at today’s prices.
With a funeral plan in place, it can benefit your family, not just financially but emotionally too. However, there are some drawbacks to taking out a funeral plan. It’s therefore important to consider the pros and cons before deciding whether one is right for you.
If you’ve ever planned a funeral before you’ll appreciate that there are lots of details to consider and decisions you have to make. When you look into a funeral plan, you’ll soon realise that there are lots of options, including what’s included in your funeral plan. Every provider is different, but as a general guide, you can expect the following costs to be covered by a funeral plan.
- Collection of your body from any hospital, care home, public mortuary, or residential address
- Doctor’s fees, if they have to be paid
- Basic coffin
- Care of the body
- Cremation fees
- Transfer to a crematorium
- Delivery of the ashes
The Pros of a Funeral Plan
The main benefits of a funeral plan are:
- You pay the cost of your funeral at the time of taking out your plan, so it can save you and your family money should funeral costs increase
- When the time comes for your funeral, your family won’t have to pay or make the arrangements
- It’s possible to pre-arrange your funeral at a price you’re willing to pay
In addition, there are several more advantages of paying for a funeral plan. For example:
- Should funeral costs rise in the future or you live in an expensive area, it could save money for your family
- You’re paying for your funeral in advance so funeral costs won’t be a problem should your family have cash flow issues
- Your funeral plan freezes the cost of your funeral at today’s prices, thereby avoiding inflation
- Your loved ones won’t have to worry about making funeral arrangements at a time when they’re feeling very emotional
- It removes the risk of families being oversold services that you didn’t want
- You get the opportunity to compare funeral plan prices and services and pick the one that’s best for your
- You’re able to choose the type of funeral you want
- Acceptance is guaranteed regardless of your health
- Funeral plans are exempt from inheritance tax
- Funeral plans are not counted in means-tested assessments for care homes
- Most funeral plan providers offer flexible payment options, including monthly instalments
- If you choose to pay monthly, your chosen services will be provided even if you haven’t completed the payments, as long as the initial waiting period has passed
- In the UK, funeral plans are regulated by the Financial Conduct Authority (FCA), as of July 2022. The FCA is responsible for the regulation of financial services in the UK. It protects consumers, and financial markets, and promotes effective competition in the best interests of consumers
The Cons of a Funeral Plan
So, what about the downside of taking out a funeral plan?
- Not all funeral costs are covered by the plan, for example, flowers, memorial, wake, or embalming
- If funeral costs go down or you live in a less expensive area, you could end up paying more
- The funeral plan may have limitations such as the timing of your cremation and the location
- You may also be restricted in the funeral director you choose
- If you move areas, you may have to pay more
- The money you spend on your funeral plan could be used for something else
- If you move overseas, you won’t be able to use your funeral plan, unless it’s a European one
- If you’re expecting to die soon, a funeral plan might not be worth it and could cost more
Final Thoughts
Should you purchase a funeral plan? That depends on your budget and personal circumstances. A plan is worth it if you want to pay for and arrange everything yourself. It can be a struggle for families to pay for a funeral, so this kind of arrangement made and paid for in advance could help them.
If you’re thinking about getting a funeral plan, it’s advisable to weigh up the pros and cons, compare prices and services, and look for a company that’s registered with the Funeral Planning Authority (FPA). The FPA is an organisation set up by the industry and its job is to regulate providers in the pre-paid funeral plan industry in the UK.
