When someone close to you passes away, the last thing you want to worry about is how much the funeral will cost. Unfortunately, that is often one of the first things on people's minds. This complete guide will lay out all the costs associated with funerals and burials to help give you peace of mind.
Whether it’s for yourself or a loved one who has recently passed away, understanding the costs of a funeral and how to avoid the unexpected can make the process a little easier.
Here are the areas we'll cover:
Average funeral and burial costs
Funeral costs breakdown
What is life insurance?
What is burial insurance?
Life insurance vs burial insurance
Why choose funeral insurance?
How to choose the best funeral insurance plan for you
1. Average funeral and burial costs
The average funeral and burial costs in the United States have skyrocketed in recent years, with the average funeral costing between $6k and $15k depending on which state you are located in. This can become a daunting financial burden for families who are trying to grieve the loss of a loved one.
2. Cost breakdown
Funerals
When planning for a funeral, the average person thinks about the casket and burial location. However, other costs, which aren't as obvious, can add up quickly.
Burials
Many different factors that contribute to the final cost of a burial. The type of casket, the services provided by the funeral home and the location of the burial all play a role.
Here is a breakdown of some of the most common expenses associated with a burial:
*Average costs according to National Funeral Directors Association from 2021.
Cremations
Cremation is a popular option for those who prefer not to have a physical body after death. Cremation costs vary depending on the crematorium and the service chosen, but in general it can cost significantly less than burial. The table below breaks down some costs typically involved with a cremation.
*Average costs according to National Funeral Directors Association from 2021.
Other hidden costs
Hidden costs such as the headstone, flowers and obituaries can add thousands of dollars to the cost of a funeral.
Setting a headstone - Can range between $150 - $450 for a cemetery to install.
Obituaries - A short obituary can cost $200–$600, whereas a long, detailed one can cost as much as $1,000.
Funeral Celebrant - Can cost from $250 to $1000.
If you are considering planning your own funeral as a way to remove the burden from your family, you may want to consider funeral or burial insurance. This type of insurance policy will pay out a set amount of money upon the death of the policy holder, which can be used to cover funeral and burial expenses. We will go into the different types of insurances in a moment.
3. What is life insurance?
Life insurance is a contract between an individual and an insurance company. The individual agrees to pay a premium to the insurance company in exchange for the insurance company's promise to pay a designated beneficiary a sum of money upon the individual's death.
The purpose of life insurance is to provide financial security for a beneficiary in the event that the insured person becomes deceased. Funeral expenses can be high and life insurance can help cover those costs.
There are different types of life insurance policies, and each has its own unique features and benefits. It's important to speak with an agent to find the policy that best suits your needs.
4. What is burial insurance?
Burial insurance is a type of life insurance policy that pays a specific, predetermined amount of money to the beneficiary(ies) after the policyholder dies. It is also known as final expense insurance or funeral insurance.
The purpose of burial insurance is to help pay for the costs associated with a funeral and burial. These costs can include the funeral itself, cemetery expenses and other related costs.
Most burial insurance policies are relatively small, ranging in value from $5,000 to $25,000 according to Forbes. Burial insurance is typically less expensive than other types of life insurance policies, making it a popular choice for those looking for coverage after they die.
There are several different types of burial insurance policies available, including whole life policies, term life policies, and permanent life policies.
5. Life insurance vs funeral insurance
There is a big difference between funeral insurance and life insurance. Funeral insurance is a type of burial insurance, which is a policy that pays out a lump sum of money to the beneficiary when the policyholder dies. This money can be used to cover the cost of the funeral.
Life insurance, on the other hand, also pays out a lump sum of money to the beneficiary when the policyholder dies, but it can also be used to cover other costs such as debts or medical expenses.
6. Why choose funeral insurance?
There are many reasons to consider funeral insurance. One reason people might consider funeral insurance is because it is often much cheaper than life insurance.
Funeral insurance policies usually have lower premiums and smaller payouts than life insurance policies. This means that they are not as expensive to maintain, and they are also less risky for the insurer.
Another reason is that it can help protect your loved ones from having to bear the burden of paying for your funeral. Burial expenses can be quite costly, and burial insurance can help cover those costs. Funeral insurance can also provide you peace of mind in knowing that your loved ones will not have to worry about how they will pay for your funeral.
These insurances can also help you plan for your burial. You can choose the type of service you want, and you can even pre-pay for your burial arrangements.
Finally, funeral insurance is a good way to ensure that your family has some money available after your passing.
7. How to choose the best funeral insurance plan for you
When it comes to funeral insurance, there are a lot of options to choose from. How do you know which plan is best for you?
Here are a few tips:
Decide what you want the insurance policy to cover. Most policies will cover the costs of the funeral and burial, but some policies also include other expenses, such as hospital bills and legal fees.
Compare the different policies available. Look at the cost of the premiums, as well as the coverage limits.
Decide how much coverage you need. The average funeral costs around $8,000, but prices can vary depending on your location and the type of service you choose. Make sure that your policy has enough coverage to cover your needs.
Read the terms and conditions carefully.
Summary
It's important to be aware of the many costs associated with funerals and burials. While many people assume that the funeral home will take care of everything, this is often not the case. By being proactive and understanding what your options are, you can ensure that yours and even your loved one's final arrangements are carried out in a way that is both respectful and affordable.
Also, to help keep your loved ones' memories in mind, memories offers a free or paid online memorial to remember their life.