Dying is a Costly Venture


Just a warning, we’re talking about death and funerals in this article. No one likes to think about it let alone talk about it but it is a part of life – or technically it’s not. Either way, it’s one of your last big expenses and who wants to leave it to their loved ones to deal with?


So, do you know how much a funeral costs? It’s not as easy and cheap as ‘stick me in a cardboard box and drift me out to sea’. There are funeral director fees, transportation costs, coffin, death certificate, burial or cremation costs, flowers, newspaper notices, the lists goes on. It costs a lot to die!

Funerals can cost anywhere from around $4,000 for a basic funeral up to around $15,000 for a more elaborate ceremony but can be even more depending on all the bells and whistles.

Funeral directors usually required a deposit to be paid up-front, with the balance payable immediately after the funeral. If the account isn’t finalised within these limited timeframes, the funeral director may charge interest on the amount outstanding.

If someone dies, they may have superannuation or even life insurance that can be paid to their dependents or their estate. This money could be used to help fund the funeral however it can take some time for the funds to be paid out. In most cases, the family of the deceased would need to pay for your funeral and then be reimbursed once funds have come through from super or insurance pay-outs. This can put a lot of financial pressure on a family while they should be concentrating on their grief.

There are a number of different ways that you can fund your own funeral so you don’t need to leave this additional stress to your family. You could:

Start a savings account particularly for these expenses, however note that these funds may not be accessible immediately as they may have to go through your estate.

Start a savings account in a child’s name so that they have access to these funds, however you need to be aware that the funds could be caught up in gifting rules if you are receiving the Age Pension or other support income and any income generated from the savings account is taxable in the child’s name.

Pre-pay your funeral direct with a funeral director however these can be very inflexible, particularly if you move interstate or change your mind on your pre-paid funeral.

Establish funeral insurance which, like all other insurances you pay an ongoing premium so that when the time comes, the funeral costs are covered. The problem with this is if you live a long time, your premiums could outweigh the cost of your funeral and you have over paid with no potential to recoup these funds. In addition, these costs can be excessive when only receiving minimal income like the Age Pension.

Establish a funeral bond. This is almost like an investment but it guarantees an amount of funds or funeral itself if negotiated with a funeral director but if your funeral costs are more than what you had planned or expected, your family may still need to fund the difference. It is a lump sum payment that is only paid out on death for funeral costs. These funds are not counted towards your assets or income tests for the Age Pension.

The best way to fund your funeral is to get proper advice on the options available and which one is best for your situation. Alternatively, just don’t die. And while you’re there already talking about kicking the bucket, you should round off the experience by ensuring your Wills are up to date and that you have appropriate Powers of Attorney in place to ensure that your wishes are followed when you’re gone.


This blog was first published in Leaders and Lattes

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