Why People Are Borrowing To Pay For Funerals

Research shows that an increasing number of people are having to pay for the funerals of their loved ones, with total funeral-related debt in Britain hitting a whopping £147 million in 2016. The research was carried out by Royal London, who found that a funeral now costs an average of £3,675. Nevertheless, this is a reduction from last year’s average cost of £3,702.

Varying Costs Above Affordability Levels

The costs include fees for the funeral minister at £143 on average, funeral director service fees at the largest chunk of £2,208 on average, and doctor fees at £164.

Costs for funerals were shown to vary widely by geography. A funeral in Belfast cost just under £3,000, but the price was well over £9,500 in North London’s Kensal Green. Cremations were cheaper, however, at £2,879 in Belfast and an average of £3,165 in North London.

More than 93,000 people are still having to borrow from family, friends and lenders in order to meet funeral costs, with the average borrowing rate being £1,600.

More Affordable Funerals

Royal London has called on the government to take steps to tackle this funeral poverty and review the funeral expenses payment element of the Social Fund. This includes the time taken to receive the payment, which will typically fall short of the funeral cost itself. With debt levels rising and increasing numbers of customers taking out individual voluntary agreement products with providers such as https://www.carringtondean.com/individual-voluntary-arrangement-iva/, the need is great than ever.

Difficulty in Accessing Support Payments

This payment exists to help people on low incomes meet the financial costs of a funeral they have the responsibility for arranging. Royal London is also calling on the industry to provide cheaper and simpler funeral options, including direct burial options and cremation. This direct version of the service has no procession, hearse or service. The client cannot pick a time or date for it and no attendees are allowed to be present. These tend to cost around £1,000, and there is an option to scatter the ashes or organise a memorial service at a later date.

In the meantime, forward-thinking consumers are buying funeral payment plans as a form of insurance for the future and to help avoid having the cost of their funeral fall onto their loved ones’ shoulders.