Why you should consider a pre-paid funeral
The prospect of arranging your funeral expenses might sound particularly morbid, but it can save your loved ones a considerable amount of time, money, hassle and grief. We’re going to take you through the ins and outs of pre-paid funerals and why you should consider making similar arrangements (if you haven’t already).
How much does a funeral cost?
According to the Australian Securities and Investments Commission’s (ASIC) Money Smart online resource, “Funerals can cost from $4,000 for a basic cremation to around $14,000 for a more elaborate casket, burial and flowers.”
These costs generally involve fees, transport, certificates and ceremonial expenses and tend to add up quickly, potentially causing a lot of grief to family members who are already struggling to come to grips with the mourning process.
How does a pre-paid funeral work?
A pre-paid funeral is one that is purchased in advance, either up-front or through instalments paid over time, where you can determine the details of the ceremony. There is a range of reasons you might want to do this. You might have cultural ties that need to be represented, features you would like to have in your ceremony, or you might just be conscious of arrangements being left to your grieving family.
However, as ASIC states on Money Smart, it’s still easy to be taken for a ride and important to be vigilant. ASIC says, “You should ask for a full description of the costs to see exactly what you are paying for. Funeral service operators who don't reveal the costs of a funeral are in breach of the Competition and Consumer Act 2010.”
Pros and cons of arranging your own funeral
As ASIC also states, there are benefits to arranging your own funeral, but there are also some risks that anyone considering such an arrangement needs to be aware of.
Pros
- Costs are fixed in today's dollars even if your funeral is not for many years.
- You can control funeral arrangements if you want to.
- You can pay in instalments over time.
- Can be a lot cheaper than a funeral bond or funeral insurance.
Cons
- Can be inflexible if you move interstate to live with family.
- If you change your mind you may not be able to get your money back.
Source: Money Smart
Would you consider a pre-paid funeral?
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