Responsibilities in Planning for Funeral Costs

When asking consumers if they were financially prepared to pay the funeral expenses of a loved one, a recent National Foundation for Credit Counseling (NFCC) online poll revealed that an overwhelming 83 percent either were not prepared to take on the financial responsibilities of a funeral or had no idea what a funeral costs.

“Today the average cost for expenses associated with a funeral in America is estimated to be between $7,000 and $10,000,” said Gail Cunningham, spokesperson for the NFCC. “Even though it may be difficult to think about, making decisions in advance will pay off both emotionally and financially.”

Funeral decisions can become complicated, generally involving multiple entities such as the funeral home, the cemetery and purchasing a headstone or grave marker. The funeral home may offer to provide all of these services as a package, or the consumer may opt to contract with each entity separately.

Additional costs may be incurred transporting the remains, embalming, using the funeral home for a viewing, visitation, or ceremony, and the use of a hearse or limousine. The list continues with the purchase of death certificates, flowers, obituary notices, officiating clergy, organists and soloists.

With so many decisions to be made, consumers might consider the following when planning a funeral:

• Make sure that those responsible for your burial are aware of your funeral preferences. Put preferences in writing and give copies to family members.

• Comparison shopping may sound crass, but what other $10,000 expense would a person make without comparing costs and features? Apply the same smart shopping techniques that would be used for other major purchases.

• Avoid emotional overspending. Resist any pressure to buy goods and services that aren’t truly wanted.

• Laws regarding funerals and burials vary from state to state. It’s a smart move to know which goods or services the law requires and which are optional

• The casket can be the single most expensive item purchased for a funeral, with an average casket costing slightly more than $2,000 and continuing up the scale to as much as $10,000.

The FTC’s Funeral Rule applies here, too. Before the viewing of any caskets, the funeral director must provide a list of caskets the company sells, with descriptions and prices included. Further, the funeral home cannot refuse or charge a handling fee for a casket purchased elsewhere.

• Some people may prefer to enter into a pre-arranged funeral plan where some or all of the expenses are paid in advance. Purchasers should know what happens if the firm goes out of business or if they change their mind and want a refund. It is important that the family be informed if a pre-need plan exists.

A one-time preparation for funeral planning should be seen as important as paying taxes or creating a plan to meet an obligation.

 

Author’s note:

The National Foundation for Credit Counseling (NFCC), founded in 1951, is the nation’s largest and longest serving national nonprofit credit counseling organization. Its mission is to promote the national agenda for financially responsible behavior and build capacity for its members to deliver the highest-quality financial education and counseling services.