Pre-paid funerals soar as costs rise
A funeral will be the final major expense of your life – but the cost is climbing.
Between 2019 and 2023, the estimated cost of funerals for over-50s rose from $9055 to $11,039, according to research conducted by CoreData and commissioned by Australian Seniors.
Similarly, the estimated cost of cremations rose from $6334 to $8045 over the same period.
More than half of people surveyed had to dip into their savings to finance a funeral.
The rising cost is placing a heavier burden on Australians already going through some of the hardest times of their lives.
When Sara Poole, now 38, lost her partner Nick in a 2019 motorbike accident, death was not something the couple – who by that time had a young daughter – had thought about.
“When they told me Nick had died in a motorbike accident, time stood still but went so fast,” she said.
As they all dealt with their shock and grief, Nick’s family covered the cost of the funeral and Sara paid for the wake.
She said that until that point, she had no idea how pricey a funeral was.
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“Also, I went from two incomes to none as I couldn’t work either, and covering both my loan and his plus all the normal bills,” Sara said.
“I’m pretty sure Nick’s sister put [the funeral] on her credit card, then his mum and dad and other sister shared the cost.”
Research from end-of-life provider Bare found more than a quarter of Australians experienced some form of financial hardship after paying for a funeral, and two-thirds believed funerals in Australia were overpriced.
According to Bare, the end-of-life process involves several components:
- The body disposition, commonly a cremation or burial
- A ceremony or send-off, commonly referred to as to the ‘funeral’ or memorial service
- The memorial site for loved ones to visit to memorialise the deceased, commonly a headstone if buried, an urn, or the place where ashes were interred.
Jessica, manager at Kingston Funerals Melbourne, said funeral and cremation costs had risen alongside other cost-of-living pressures such as energy, petrol and food.
She said much of the price hikes seen in final bills came down to third-party charges from crematoriums and cemeteries.
Because funerals are generally an “at-need”, unexpected expense and a “taboo” subject, Jessica said people typically don’t put money aside in advance.
But the trend is gradually turning to take the burden off bereaved loved ones and personalise their own send-offs.
“We look after a lot of pre-paid funerals, and it is a fantastic option, because people can select what they want for their funeral, lock that into a contract, and they pay today’s prices,” she said.
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Bare co-founder Cale Donovan said his company had experienced a 71 per cent increase in interest from a wide spectrum of people looking for a pre-paid funeral in the past three months alone.
And if a funeral service provider folds before your death, it does not necessarily mean your money was wasted.
“Generally what happens, the money that people pay is invested into a funeral bond, and the person who is the beneficiary of that bond is the individual and their funeral,” Donovan said.
“What that practically means is, if the funeral company goes under, all of those funds are still available for your funeral at the time of death, and the funds from that funeral bond are actually released to the funeral provider who provides the service.
“And so whilst you may not have the same price certainty that you had in the initial contract, certainly all of the funds that you’ve paid, they’re exclusively for the use for your funeral.”
When pre-paying for a funeral, either burial or cremation, he said not to be afraid of asking too many questions – or shopping around for better prices and services.
He said generally people only get one or sometimes no quotes for funerals, but that could mean both a compromise on the style of service being sought, and a financial loss.
For example, he said the average cremation service offered by Bare cost $2860, far below the national average cremation funeral cost.
Australian Funeral Directors Association CEO Dale Gilson echoed the recommendation to compare prices from multiple funeral directors, as he said the higher cost of funerals may be driven up by a lack of affordable options in favour of elaborate burials and services.
If you want to cut costs by bringing flowers from your garden or catering the event yourself, as suggested by Jessica, you can.
“Our members can conduct any kind of service a family wishes as long as it is legal,” Gilson said.
“Long gone are the days of it has to be the traditional method that people think of the funeral industry. If you want to personalise your funeral service, just ask.
“The Australian Funeral Directors Association recommends people plan ahead. This removes much of the emotion of the time when a loved one has died and allows for the person planning their funeral to consider what they want and their budget.”
– TND
