Funeral costs continue to rise – how to plan ahead

Funeral costs continue to increase in the UK with the average cost reaching a record high of £4,285 according to Sunlife’s cost of dying report. The report states that 1 in 3 people feel that the cost of living crisis has impacted organising or paying for a funeral.

What is the cost of a funeral?

The average cost of a funeral has risen from £4,141 in 2023 to £4,285 for 2024 and is 134% more, when compared to the average funeral cost in 2004 (when SunLife began compiling its annual cost of dying report). The report reflects the changing landscape of funeral arrangements, where rising costs run alongside an almost sevenfold increase in people choosing direct services (a service without attendants) since 2019.

The actual cost of a funeral will depend on the type of funeral you choose as well as any extras you choose to include, such as flowers, cars and catering. London and the South East of England remain the most expensive areas of the country to arrange a funeral while Northern Ireland is the least costly, so where you live will also impact the cost of a funeral service.

Average funeral costs

Type of funeral	Average cost	What percentage of people choose this option?
Burial	£5,198	24%
Cremation	£3,980	54%
Direct Cremation	£1,597	20%
Direct Burial	£1,527	2%

Funeral costs are not the only financial consideration when someone passes away, though, as the overall cost of dying has reached £9,797 on average. This includes the funeral costs as well as legal and professional fees for settling the deceased person’s estate and any extras such as flowers, limousines and catering. When asked, funeral directors suggested that additional funeral expenses could be greatly reduced by simple things like shopping around for the service, choosing to use a local florist instead of the funeral director or using social media for funeral notices instead of a newspaper.

5 ways to fund funeral costs

The report from SunLife found that only 68% of people who died in 2024 had made provisions for funeral costs and of these, only 56% were adequate. Here are some ways that you can ensure that there will be enough money to pay for your funeral when the time comes.

Save and put money aside

It may seem like the most obvious thing to do and 25% of people who fund their own funeral do so through savings and investments. However, consider how much money you are able to save and how quickly you can save enough to cover the cost of your funeral. Once you have saved an amount that you feel is enough to pay for your funeral, you should also factor in the effects of inflation on this money. If your death does not happen for many years, ask yourself if the money you have put aside will cover the likely increased funeral bill in the future. On the other hand, if your death happens prematurely, you may not have saved enough money to make a difference.

You may already have funds within savings and investments that are sufficient to cover the cost of your funeral. Ensure that these can be accessed by those left behind, as funeral costs will need to be paid quickly and usually long before your estate is likely to be settled through probate. Even the most simple of estates can take from six months to a year to conclude and settle.

Buy a Pre-paid Funeral Plan

Prepaid funeral plans are the most popular solution for people who not only wish to cover the cost of their own funeral but also choose which type of funeral they would like. Most plans will offer different tiers of funeral arrangement and many offer peace of mind that the money you have paid will cover the funeral costs even if these rise in the future, meaning you can secure today's rates.

A prepaid funeral plan can give you a lot of control over your own funeral arrangements and ease the financial and administrative burden for your family and friends but it is a good idea to discuss your choices with those close to you. Especially if you choose to strip away extra costs and opt for a no-frills funeral as this may conflict with their wishes.

Arrange an Over 50s life insurance plan

Over-50s life insurance plans have long been advertised as a type of insurance that can be used to pay for your funeral. You won’t need to disclose any health details about yourself and you can usually qualify as long as you’re between 50 and 80 years old. When you die, your insured amount will be paid to your nominated beneficiary so they can use it as needed. You may, however, end up paying more into this type of plan than the amount that pays out and there is usually an initial qualifying period of around 2 years before a successful claim can be made. You can read more about this type of life insurance in our article, “Over 50s life insurance - what is it and is it worth buying?”.

Arrange a Term life insurance plan

If you are at an earlier stage of your life and funeral costs seem far off in the future, you can incorporate some funeral provisions within a term life insurance policy. You may need term life insurance - a type of life insurance that covers you for a set period of years - to cover your mortgage or provide security for your family who depend on you for living. It can be fairly easy and cost-effective to increase this life insurance amount by enough to also pay for your funeral, should you die prematurely. You will have to make other provisions beyond the term of the life insurance as and when it expires though. We explain more about this type of life insurance in our article, “Term life insurance - how it works”.

Arrange a Whole of life insurance plan

You can cover funeral costs through a whole of life insurance plan which will continue to cover your life until your death, regardless of when it happens. This life insurance can seem similar to an over-50s plan but it will require that you disclose your health history. However, as long as you are fairly healthy or have well-controlled medical conditions, it could provide better value for money. As with the over 50s life insurance option, you may end up paying in more than it pays out depending on how long you live so this needs to be weighed up. You will find more information in our article, "Which is better - Term or Whole of life insurance?”

Making a plan to pay for your funeral

Whichever way you choose to fund your funeral costs, it is a good idea to discuss your wishes and plans with those who will be making the arrangements. Often, the toughest part of arranging a funeral for someone is not knowing what they would have wanted.

If you wish to arrange a life insurance policy that will pay out a sum of money to cover the cost of your funeral, you can speak to a life insurance expert* who will talk you through your options after understanding your wants and needs. A number of providers including Co-op Funeralcare, Pure Cremation and Dignity offer prepaid funeral plans if you would prefer to secure your funeral costs with one payment or a payment plan.

 

If a link has an * beside it this means that it is an affiliated link. If you go via the link, Money to the Masses may receive a small fee which helps keep Money to the Masses free to use. The following link can be used if you do not wish to help Money to the Masses - Howden Life & Health