Only a minority of people are making proper financial arrangements for their funeral, according to new figures from the Funeral Planning Authority (FPA).
The FPA surveyed 1000 people aged 18 and upwards. It reported that 52 percent admitted to giving no thought at all to how they might pay for their funeral in future. Almost a third (30 percent) of over 55s hadn’t considered the matter.
The FPA research showed only 14 percent of respondents made an accurate cost estimate of between £3500 and £4000 when asked. 66 percent of respondents were found to be underestimating the cost – with half of these people believing a funeral costs £2500 or less.
When respondents were asked why they hadn’t thought about paying for their funeral. 31 percent admitted they found it too depressing. 32 percent felt they didn’t need to think about it at their age. 29 percent said they had other more pressing financial priorities.
Despite the figures suggesting a widespread reluctance to think about funeral planning, there are a number of people who are thinking ahead.
Over a quarter have either purchased a funeral plan, life insurance policy or put money aside in savings for their funeral. When asked why they had put the plans in place, 51 percent of those respondents said they wanted their affairs to be in order as they are getting older.
31 percent of respondents said they like to plan for everything financially – and that includes their funeral. 19 percent said they had experienced the death of loved ones where plans were not put in place, and wanted to actively avoid that happening with their own funeral in future. Consideration for family members was also a factor for 18 percent, who admitted they didn’t think their loved ones would be able to foot the bill unless they made financial plans themselves.
Graeme McAusland, CEO of the FPA commented: “Although the research suggests that many are putting off thinking about how they would pay for their funeral, it is encouraging that those who are considering it are actually taking action and making proper financial arrangements.
“The figures show an emerging group of financially astute over 45s are either buying funeral plans, life insurance policies or putting aside savings. This backs up what we are seeing, and that is that demand for and general interest in prepaid funeral plans is significant, particularly, but not exclusively among over 60s.”
Fear of costs
The survey also asked consumers about their concerns when it comes to paying for their funeral in future. 41 percent are worried about funerals becoming more expensive. 28 percent are concerned about hidden costs no one was expecting. 22 percent are worried that their loved ones could end up spending too much on their funeral when the time comes.
The FPA advised that one of the key features of a prepaid plan is that the costs of the funeral are protected against future inflation, and that the planholder knows exactly what they are buying and what it does and doesn’t cover. The cost can also be spread rather than paying a lump sum.
Mr Mc Ausland commented, “This research highlights that quite a few of the concerns people have about paying for a funeral are around escalating or hidden costs. Buying a prepaid plan helps protect against both, so we believe that increased awareness of this will fuel further growth of the industry. Consequently, it’s more important than ever that providers of these prepaid plans are delivering a good quality product and service that consumers can really trust.”
The FPA have this month launched a new website for consumers, to help them understand how prepaid funeral plans work, what the benefits are and to review a list of registered funeral plan providers.
Mr Mc Ausland concluded, “Providers that successfully register with us have to adhere to our stringent set of Rules and our Code of Practice, which go above and beyond the minimum requirements, so we would encourage anyone thinking of purchasing a plan to do so with one of these organisations. They can have the reassurance that the firm has been subject to additional scrutiny from the FPA with the aim of ensuring that they will get the funeral they’ve paid for when they need it.”