The Cost Of Funerals, Death, and Dying

in Retirement Planning by

In early 2006, I started working in an industry that I had never once considered; the funeral industry.  For the next six years, I worked alongside my husband, a mortician, helping families prepare for their final goodbyes. During that time, I witnessed immeasurable heartache and tragedy, and learned just how fragile life can be. The truth is, not everyone dies of old age and safe in their bed. 

The world can be a dangerous place, and people die unexpectedly more often than you think. I helped bury babies and teenage mothers, young parents and lost souls. I assisted in over 1,000 funerals during my time in the funeral industry, but the surprise deaths- the tragic ones- are the ones I’ll never forget. It was during those desperate times that I learned how to help people who hated everything and everyone, and how I could play a part in easing their burden by making the entire process go as smoothly as possible.

Although I learned a lot about human emotion and grief during my time in the funeral industry, some of the most valuable lessons I learned were financial ones. For example, one thing I learned about funerals, death, and dying is that no one really wants to plan for it. Death is entirely inevitable, yet so many families do nothing to ensure that the financial aspect of death is taken care of. And when this happens, the pain of the loss is made much worse than it should be.

Imagine losing your mother then realizing that she doesn’t have any life insurance. (See: The Difference Between Term, Whole, And Universal Life Insurance). Now imagine that you don’t have the money to pay for a proper burial or cremation. This kind of situation happened far too often during my time in the funeral industry, and my husband continues to experience it daily.  But, why?

The Truth: Funerals Are Expensive

According to the National Funeral Directors Association, the median cost for a traditional funeral in the United States was around $7,045 in 2012 (This includes basic services of the funeral home, embalming, visitation, a funeral service, hearse and car rental, and a basic metal casket). As you can see, the cost of a traditional burial has been rising faster than inflation for many years:

funeral cost table*National Funeral Director’s Association, Trends and Statistics, 2013

And keep in mind, the cost of an average funeral doesn’t include cemetery expenses such as burial space, a burial vault, the opening and closing of a grave, or a headstone. When accounting for those expenses, the average cost for a traditional funeral rises dramatically, usually to somewhere between $9,000 and $12,000.  I’ve even seen hundreds of families spend upwards of $15,000 or more over the years. Funerals are just like anything else; there are plenty of ways to save if you choose an inexpensive casket, vault, or service package. Likewise, there are plenty of ways to splurge, especially if you prefer higher quality materials.

Traditional Burial vs. Cremation

One way many families keep costs down is to choose cremation instead of traditional burial. The price tag for a cremation varies due to regional influences and other factors, but the average cost was around $3,000 in 2012. When a body is cremated, there is typically no need to buy a casket or vault, nor do you have to pay for burial space or a headstone. Being able to forgo some of these larger expenses is one way cost-conscious consumers can cope with high costs. Because of the savings and other factors, the U.S. cremation rate has been on an upward trend for decades:

Cremation Rate*National Funeral Director’s Association, Trends and Statistics, 2013

But, choosing cremation doesn’t always solve a financial crisis. The problem is, some families don’t have the money to pay for the funeral they want, regardless of the cost. This is especially true when there is no life insurance in force, or the family discovers that it has unknowingly lapsed or expired.

Here’s what typically happens when a family can’t really afford a funeral:

  • The family decides to pay for the funeral out-of-pocket. This often causes conflict since siblings often do not have the same financial resources.
  • The family asks the funeral home if they can make payments. Note: Many funeral homes do not allow families to make payments on a funeral service since they have no recourse if payments are not made.
  • The family puts the funeral expenses on a credit card, or even multiple credit cards. Now they are stressed over losing their loved one and having thousands of dollars in new debt.
  • Everyone in the family refuses to pay and expects the funeral home to resolve the issue.

Sounds stressful, doesn’t it?  Now imagine that you’re the funeral home. If you choose to proceed with the funeral service or cremation, you must concede that you will probably never be paid. However, if you choose to do nothing, you are left with a lifeless body you cannot bury and a very angry family.

This happened all the time when I worked in the funeral industry, and families usually came up with some way to pay when given no other option. My old boss even took cars and guns as payment every once in a while. That probably sounds crazy, but it’s true! At the end of the day, it was better to get something as payment instead of being left completely empty-handed.

The Gift of Planning Ahead

The best way to ensure that your family doesn’t have to deal with this type of situation is to plan ahead. This typically involved buying a life insurance policy and putting your final wishes in writing. I’ve seen firsthand how relieved a family can be when they find out that their mother, father, or sibling has a valid life insurance policy. It’s like the weight of the world is lifted off of them because they can stop worrying about the financial aspect of the death and start focusing on their grief.

Although no one wants to do these things, making preparations for your death makes perfect sense.  Think about it. We prepare for everything in our lives; we save for college, for weddings, and for retirement. Why shouldn’t we plan for our final days and our inevitable demise?  It’s certainly depressing, but not as depressing as leaving your family in a desperate situation just moments after your death.

So, force yourself to do the right thing and plan ahead for your family’s sake. If you’re unsure of where to start, the following tips might help:

  • Research the difference between term and whole life insurance and purchase the policy that makes the most sense for your specific situation.  Remember, your death will pose its own set of challenges.  Make sure that money isn’t one of them.
  • If you don’t plan on relying on life insurance to pay for your final expenses, take action to ensure your family has the cash on hand.  Also, research funeral costs in your area to make sure you have enough.
  • Put your final wishes in writing or, better yet, hire a lawyer to draw up a will and final documents for you. You may be gone when the time comes around to use them, but the effort you’ve made won’t go unnoticed by those who love you the most.

Want to know the real truth about funerals, death, and dying?  It’s that we’ll all have to deal with it one day- whether we want to or not.

The bitterest tears shed over graves are for words left unsaid and deeds left undone.”
Harriet Beecher Stowe

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Holly Johnson

Holly Johnson is a financial expert and award-winning writer whose obsession with frugality, budgeting, and travel plays a central role in her work. In addition to serving as Contributing Editor for The Simple Dollar, Holly writes for inspiring publications such as U.S. News and World Report Travel, Personal Capital, Lending Tree, and Frugal Travel Guy. Holly also owns two websites of her own - Club Thrifty and Travel Blue Book. You can follow her on Twitter or Pinterest @ClubThrifty.

36 comments

  1. Addison @ Cashville Skyline

    Great post, Holly! Thanks for shedding some light on a situation that makes a lot of people uncomfortable to talk about.

    Reply
    • dofphish

      I’ll talk about it. I’m single, 41, can’t have kids and disabled. My parents will be gone and I will still be single. I have no money. But guess what? I WON’T CARE WHAT HAPPENS – I’LL BE DEAD. Having been dead once already, killed in a motorcycle wreck going less than 35 pulling into a church parking lot, I kinda know what to expect. What I KNOW is that the earthly vessel known as my body will be dead. It can become compost or ash I don’t care. Donate it to science. It can be dumped on the side of the road for animals to eat. A good old fashioned sky burial would be the best!
      What happens after that is between me and my maker. End of story.
      ps IF this sounds sad, don’t cry for me – I’ve already been dead. Almost died from West Nile 2 years ago too! There’s a plan for me, if not then I’ll survive just fine – either way…

      Reply
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      Reply
  2. AZWarrior

    Bill me.

    Reply
    • Jay Melo

      The County will be glad to cremate you and spread your ashes in a field and then you won’t have to worry about the bill.

      Reply
  3. HerpDerp

    708 dollars in 1960 equates to about 5600 in todays money. To be honest, a less than 2k increase over 50 years isn’t too bad. Plus, there are probably more additions that equal an increase of cost.

    Reply
  4. Steve

    I too worked in the funeral industry for 6 years! From age 15 to 21 I worked at a cemetery. This wasn’t some little church yard. This place was over 100 acres, had a full time unionized crew, and thanks to the Jewish section, burials 7 days a week.

    I was hired to cut grass but wound up performing all of the duties there. I buried a lot of people and even dug some up too. What I took from it was buy the cheapest casket and vault you can. If you think paying extra for a sealed coffin and vault will keep your loved one warm and dry underground, they won’t. It all depends on the water table. I dug up cheap coffins and vaults that were bone dry and expensive ones that were wet gloppy messes. Those supposedly water proof vaults work both ways, once the seal around the lid is breached the waterproof concrete box then acts like an in ground pool and holds the water in. You’re never going to see the coffin or vault again anyway. Go cheap.

    As far as flowers go, buy the best most expensive ones because there is probably a 17 year old kid who needs to put together a nice bouquet to impress his girlfriend. We have been married for 25 years! I hope some kid will do the same with my flowers some day.

    Reply
  5. Jaime Moss

    Everyone wants to be an angel but no one wants to die. The longest river in Egypt . . . denial

    Reply
    • A. P. W

      LOL!

      Reply
  6. Anonymous

    What we need to do is to stop viewing death rituals as necessities. They aren’t. People who put themselves into debt in order to give a funeral to a loved one are fools.

    Reply
  7. Anonymous

    I agree with dofphish, I will be dead. I don’t care what they do with my body. Give it for science and cremate afterwards, spread my ashes out to sea. Shove in a beer can and throw it over board. I was in the Coast Guard, burial at sea.

    Bury them in your back yard or even cheaper yet, flush em down the toilet. Whats so bad about that? The ashes will probably get processed with the sludge, and then used for fertilizer. That means my ashes will help provide food for you to eat!

    We come from the ground were going back to the ground. Who says I Have to be buried in somebodies private land?

    When I die, I want to die in my sleep, unlike the other three screaming passengers in the car as we go over a cliff.

    IF you haven’t received the Lord Jesus Christ as your personal savior, then you have something to weep about.

    Reply
    • Mandy

      Anonymous, please keep your religion and your religious opinion to yourself. I don’t appreciate people who go around shoving their religious belief (Opinions) down my throat. I find it highly offensive.

      From an a born again atheist who is not afraid to die.

      Reply
      • celene

        if you have no religion than how can you have faith and trust in the Lord? where are you going when you die? How do you think you got here? You need to do some soul searching. You may not make it to Heaven with no belief in the Lord! wow!!

        Reply
  8. Esther Oakley

    I can only imagine what it is like to be surrounded by grieving individuals every day. You must be a very warm and happy individual to stay positive throughout all of this. I am looking at going into the funeral business because I feel I have a gift to comfort people.

    Reply
  9. Anthony Rosas

    I don’t have to imagine the worse-case; I’m living it.

    A family member, who’s a loving single father, died suddenly in the bed he shared with his son, last weekend. The 5 year old son whom he adored and lived for(he had just won a custody fight). Being a 34 yo , hard working single father, he didn’t plan or save.

    Now our Mother can’t bury her son and instantly place’s a young boy’s future in grave danger. Our family is giving everything we can, while raising money by selling, and begging if need be. It’s so stressful but you HAVE to act – and you get no time to even grieve.

    Practical advise is so hard to come by. So if I have your ear, please plan ahead for your loved one’s sake.

    Reply
  10. Mixsy A Ramirez

    I work in the Pre-Need Industry in TX. Even though this is a very difficult subject for most, many people are not aware of Pre-Need Services, different than Final Expense Insurance. There is over 100 decisions to be made when we lose a loved one and true having financial stress to top it off can be devastating for most families. For many the feelings of regret and feeling powerless because of lack of money in such difficult times can be just plain awful. Do research in your area about Pre-Need Services. This service allows you to plan ahead. Even if you don’t purchase Pre-Need Services, you will learn about your rights and obligations, Social Security Benefits, Veterans Benefits, how to leave in writing your wishes and desires, what legal documents will be needed for life insurance purposes, vital statistics information for obituaries, the type of funeral: Traditional, Direct Cremation or Burial, list of people and phone numbers to notify, bills to pay and so much more. All these decisions can be made while your mind is clear and no emotions are involved. This avoids family conflicts, and it really allows the family to grieve and celebrate your life. It is the loving thing to do.

    Reply
    • Audrey

      Thank you for that important, info!

      Reply
  11. Mixsy A Ramirez

    Also, don’t make the mistake of thinking that if you have life insurance, you are covered. Think about this: Did you purchase life insurance to pay for your funeral or to protect your family from financial burden? Are you aware that funeral homes will charge from 5 – 10% face value for processing your policy. Which means if you have a life insurance policy of $100,000 and your family is charged 5%, they will pay $5,000 and that doesn’t include any of your funeral costs!
    If you purchase final expense insurance, keep in mind inflation. The average funeral is around $9,000-$10,000 but if you purchase a $10,000 final expense insurance today and you die 15 from today, will those $10,000 be enough to cover your expenses.
    On Pre-Need Services you choose what you want, you set a 3-5-8-10 year plan. Once approved, in most cases you can die a month, a year, 5 years or 50 years down the road and you are covered.

    Reply
    • A. P. W

      Thank you Mixsy for this oh so very important information! I didn’t know this and I’m quite sure many others didn’t and don’t know that funeral homes charge a % to “process” your policy either–ON TOP OF then turning right around to do business with you?!? Wow!! If that ain’t mind blowing on top of grief, I don’t know what is!

      Reply
  12. Mixsy A Ramirez

    One last thing. The only reason and the only reason why people should consider Pre-Need Services is not because of YOU, as some of you have said, you won’t know, you will be dead, you do it to give peace of mind to those you leave behind! Love for those people! That’s it!

    Reply
    • Audrey

      Wow!@ Mixsy! I never knew or considered any of that and I bet most people, the average Joe Blow on the street–he wouldn’t either! We all just simply thought that Life Insurance coverage took care of everything–and it don’t! Wow…my mind is completely blown. You’ve taught me a lot today!

      Thank you for all of that important, info!

      Reply
  13. Lisa

    This is all GREAT information, especially for anyone who is planning a funeral. I like the idea of putting your final wishes in writing, or even hiring a lawyer to help you do so. Planning a funeral can certainly be emotional, but it helps to know that you’re at least carrying out your loved one’s final wishes. It’s totally true what the article says, we’ll all have to deal with death at some point, it’s important to be prepared when that time comes!

    Reply
    • Audrey

      AMEN, Lisa! Amen!

      Reply
    • A. P. W

      I see your name links to a Thomas Funeral Chapel….so it seems you would know that everything Mixsy wrote about the funeral home taking advantage by charging a–oops! I mean, take a percentage to process a Life Insurance policy and then doing business with the family for services needed….

      Reply
  14. Stephanie Smith

    Yeah, that rise of funeral costs has not been consistent with overall inflation. I would absolutely opt for cremation, since it would save on land space and money. The last thing I would want to do is add financial stress onto my surviving loved ones.

    Reply
  15. Alexis Webber

    I like to think of myself as frugal, and the last thing I want to do is leave my surviving family with the burden of planning a funeral that would cost a lot of money. I’d much rather have a small budget and go with a cremation. Thanks for sharing.

    Reply
    • motor club lady

      This is why I upgraded to have $50,000 Accidental Death and Dismemberment included in my motor club membership. I didn’t want to leave my kids behind having to deal with both grieving and stress over how to pay or cover the cost of a funeral expense. That would kill me. (smile).

      Reply
  16. Nirvana

    Share your article is very useful for me. Thanks a lot 🙂

    Reply
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  18. Travis Thompson

    I love how you mention the bargaining that can happen with any expensive transaction. I know a physical therapist who almost exclusively does physical therapy for motorcyclists… and the payment is typically their wrecked bike. He fixes it up in his spare time and sells them! Of course, during a sensitive time such as this, it’s important not to push… but remember, families, that there are other options! There is always another way to get this sensitive matter taken care of.

    Reply
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  21. LNWeaver

    That sounds useful for a family for the deceased to have had life insurance. That way funeral expenses will be covered. My dad is planning out his services- it’s a little macabre but he doesn’t want us to worry in the event of his death.

    Reply
  22. Harper Campbell

    It’s interesting to know that when it comes to planning my funeral ahead of time, that there are benefits for doing it. I like how you said that it will help ensure that my family doesn’t have to worry about the expenses, and that they will be able to grieve as needed. It will make me feel better knowing that, also, there is research out there that will help me narrow down the right plan to go with; and that everything can be taken care of before I pass.

    Reply
  23. janet leech

    I would like to know more about your funeral plans..

    Reply

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