This Is How To Pay For A Funeral – Low Cost & Simple

Simplifying the Funeral Process

A funeral can cost between $4,000 to $15,000, depending on whether a simple or more elaborate ceremony is planned.

If you'd like to make things simpler on your family by handling arrangements in advance, here are some things to consider:

  • What Does a Funeral Cost?
  • Pre-paid Funerals
  • Funeral Bonds
  • Funeral Insurance


What Does a Funeral Cost?

Many of us only think about what a funeral will cost when we need to set one up for a departed family member or friend.

A funeral can cost from a few thousand to tens of thousands for a full ceremony, casket, burial, and floral arrangements.

There are a few standard items that you'll need to plan for as you arrange a funeral:

  • Fees for the funeral director
  • Transportation
  • Coffin
  • Death Certificate
  • Burial or Cremation
  • Cemetary Plot
  • Flowers
  • Obituary
  • Death Notice
  • Wake
  • Funeral Savings

You can save money for your funeral by setting up a deposit account or an online savings account, then saving money until you reach an amount that will cover the funeral expenses you'd like This may be all that's necessary. You may find that you're able to save enough to pay for the funeral just through savings.

Keep these separate from your day-to-day accounts.

This account will make up part of your estate after your death, so be sure to arrange it so that it is accessible by a beneficiary in order to pay for funeral expenses.

Pre-paid Funerals

Paying for a funeral in advance allows you to make choices and pay for what you'd like to have. This is especially important if you have specific cultural reasons for wanting specific elements included in your funeral. If you'd like to pay for the funeral upfront, but don't know about all of the details yet, you can always pay and let your relatives settle the details later.

As you plan, be sure to ask about a full list of funeral costs so that you can see precisely what you'll be paying for.

You can either pay for everything in full, or you can make installments over some time. A deposit is typically necessary, but you may be able to negotiate the amount.

It's important to do your research, as different packages will be offered by different funeral homes.

Fixed Cost - The price stays the same, even if the funeral isn't for years to come.
Advance Planning - You can control the arrangements and select what you want.
Payment Options - Numerous options are available for payments, and you can pay in installments over time.
Less Expensive - Cheaper than funeral insurance if you live for 5-10 years.

Moving - Your arrangements may not be valid if you move out of state
Exclusions - If you change your mind, you may not be able to get your money back.

Funeral Bonds

This investment will help you to save for your funeral expenses, and can only be utilized after your death to pay for your funeral.

You can invest in these bonds through an investment company or a funeral home.

Often they can be set up to be payable to a funeral home that you select.

You can pay for the bonds in installments, but be sure you understand the full cost.

Case Study: Bob Purchases a Funeral Bond
When he retired at age 65, Bob wanted to make sure his finances were well in order. He spent some time sorting out his will, paperwork and making arrangements to pay for the funeral.

Bob didn't want to think about the details of the funeral, so he decided to buy a funeral bond. He knew that the money would grow over time, and if he lived for 15 years it would fully cover his funeral expenses. He set it up so his family could provide the bond to a funeral director that they could pick out after his death.

- Funeral bonds keep the money for your funeral away from your other accounts and investments.
- Paid in advance, this is great for those who want to pay in advance, but don't want to plan out the details.
- Your savings will grow over time.
- You're not locked into using a specific funeral home.
- You can choose how you'd prefer to pay, either buying a bond upfront or paying for it in monthly payments.

- You'll only obtain what you've paid into the bond, so if you die before it's fully paid off, you'll only receive what you've paid in and any money earned on your invested money.
- Your returns may not keep up with inflation, leaving some money still due for your funeral.

Funeral Insurance

These policies provide your loved ones with a lump sum of money to help you pay for a funeral and end of life expenses.

Immediate cover - You may be able to access coverage from day one but many policies only cover accidental death in the 12 to 24 months.
Helps people who fin it hard to save - It may help you if you aren't great at saving.

Increasing premiums - Premiums typically go up over time. This means your policy may start out cheap, but increase over time. This is a general concern for those living on a fixed income.
No refund on premiums you've paid - If you can't keep up the payments or want to cancel your policy, you probably won't get anything back - you lose what you have paid up to that date.
Your premiums could cost more than the funeral - If you live longer you may end up paying more in premiums than the cost of the actual funeral.
Exclusions may apply in the first few years - As most insurers only cover accidental death in the first 24 months, if you pass away from a terminal illness in this time you may not be covered. Always review the terms and conditions carefully.
You don't get the money right away - In certain instances your family may have to wait for the payout. This can be frustrating especially if funeral costs need to be paid immediately.

It can be difficult to think about your own funeral, but if you'd like to sort it out ahead of time, be sure to evaluate all of your options.