Thinking about the future? And how you’d like your funeral to look? A funeral plan may be the right option. Here we’ll take you through how a prepaid funeral plan works so that you can weigh up all your options.
What’s a funeral plan?
A funeral plan allows you to organise and pay for your funeral in advance. With a prepaid funeral plan there is less for your loved ones to organise and pay for. Arranging one with a funeral director now may be a good way of telling your family what you’d like at your funeral while taking some of the stress away from them in the future.
How do funeral plans work?
A prepaid funeral plan lets you cover the cost of your funeral at today’s prices. Even if funerals cost more in the future you’ll pay today’s costs. But each funeral director may have different plans and what’s included may change from one provider to the next. So it’s worth keeping in mind that a funeral plan may not cover every part of the funeral. Your family may still have to pay towards some parts of the funeral that aren’t included in the plan.
What does a funeral plan include?
Prepaid funeral plans usually include the basic parts of a funeral such as:
- Funeral director’s services (taking care of the person who died and transporting them to the funeral home)
- Chapel of rest
They may also include third party fees like cremation or burial costs. But always check this with the funeral director as it may not always be the case. Some providers may offer an allowance towards burial or cremation costs. This means that they’ll pay towards some of the cost for burial or cremation. But your family will need to add to this pot to cover the whole cost.
If the funeral plan you choose is more extensive it could also include:
- Doctor’s fees
- Celebrant’s fees
- Crematorium fees
Other services that are not part of most prepaid funeral plans include:
- A burial plot
- Memorial or headstone
- Order of service sheets
- Funeral notices
- A wake and catering
Some funeral plans allow you to make a contribution to some of these optional items. For example, you could contribute £100 to pay for flowers. Then when the plan is paid out, your family will have £100 to put towards the cost of the flowers. But keep in mind that this may not cover the full cost of the flowers, especially if prices rise over time.
Any additional services that aren’t covered in full or part by your plan will need to be paid for by your estate or by family members instead. So if there are specific extras you do or don’t want at your funeral, it’s a good idea to make a note of these and let your family know.
How much is a funeral plan?
Standard funeral plans start from around £1,800 and go up to around £4,500 for larger plans with more services included. Though you could pay more than this if you choose a bespoke package that allows you more extras*.
Keep in mind that the more you pay, the more your plan is likely to cover. But it’s always a good idea to compare plans so you get a clear idea of what’s actually included and what won’t be covered.
The cost of a funeral plan will also be different depending on the funeral director you choose and where you live in the UK. Prices tend to change from region to region. If you live in London, for example, you could be paying more for a funeral plan than if you live in the Midlands.
Read our guide to how much a funeral will cost for a full breakdown of average costs across the UK.
How do I pay for a funeral plan?
Most funeral plan providers will give you a few options for payment. You could:
- Pay all funeral plan costs upfront – if you can afford to pay a lump sum this will be the cheapest option because you won’t have to pay any interest.
- Spread the cost over 12 months – with this option you may have to pay interest depending on the provider. But it may help you manage the cost. Keep in mind that if you choose this option and you were to pass away before the payments finish the provider may only be able to refund the money. This could mean that your family have to pay for the funeral after all.
- Spread the cost over a number of years – If the cost is not manageable over a year some funeral plan providers will offer a longer time period to pay off smaller instalments. You’ll probably pay interest on this. And there is also the risk that you pass away before paying off the plan. But some providers will still cover the cost of your funeral if you pass away after 2 years of making payments. Check this with the funeral plan provider before you choose this option as it may not always apply.
Are funeral plans regulated?
From 29 July 2022 the Financial Conduct Authority (FCA) started regulating companies that offer prepaid funeral plans. So if you take out a funeral plan you’ll now have more financial protection. This means that when you take out a funeral plan with an authorised provider you’ll either get the funeral you paid for or a refund even if the company gets into financial trouble. So a prepaid funeral plan is a safe option as long as you go with an authorised provider.
If you’ve already organised a funeral plan you can check whether the company you used is an authorised provider. Use the FCA register to find out more.
Are funeral plans a good idea?
Are prepaid funeral plans worth it? As funeral costs can add up to thousands of pounds a funeral plan may help you manage things better. And take away that immediate stress from loved ones in the future when you pass away. But there are pros and cons to organising a prepaid funeral plan. Here are a few things to think about before you decide if a funeral plan is the right option for you.
|You’ll pay for the funeral at today’s costs (escaping rising costs in the future)
||There’s a chance that it could cost you more if funeral costs fall in the future
|It means your family will have less financial stress when you pass away
||The funeral plan isn’t likely to cover every part of the funeral
|You’re able to choose the parts of the funeral that are most important to you
||There may be set limits on what is and isn’t included as part of the plan
With so many plans and prepaid funeral costs to compare it can be tricky to find the right one. Use our funeral director finder to narrow down your search and see which ones offer funeral plans that fit what you’re looking for.