Protecting Your Loved Ones

For most of us, the biggest benefit is knowing that when we die, we have peace of mind that our loved ones will not have to worry about the financial impact of planning a funeral. 

Depending on what level of plan you take out, a pre-paid funeral plan will cover everything from your choice of funeral director and the number of cars through to the type of coffin, flowers, burial or cremation costs, chapel of rest and the type of funeral that you want  eg whether it’s a civil celebrant, vicar or priest to lead the ceremony. 

Rising Costs Of Funerals

Another key benefit of a pre-paid funeral plan is protection from the rising cost of funerals. Most of us will save for later in life, whether it’s via an ISA or in a savings account, but these do not protect against the rising cost of a funeral. Since 2004, the average cost of a funeral has risen by nearly 80% – by buying a plan, you pay today’s rate and protect against future price increases. 

Buying A Funeral Plan For Elderly Relatives In Care

When an elderly relative is taken into care and they own their own property or have more than £23500 savings, they will be financially responsible for paying for their own care home fees (known as self-funding). *

In the majority of cases, this will mean selling a property and using funds from their account to pay for the care. When the value of assets drop below the current threshold of £23500, a financial review can be taken to get support for care home fees from social services. 

Once a family is on this road, assets cannot be distributed between family members as this is called ‘Deprivation Of Assets’. However, one item that can be purchased before the assets drop below the threshold is a pre-paid funeral plan. If you have a family member in a care home who is currently self-funding and likely to run out of funds, they should consider purchasing a pre-paid funeral plan before their funds dip below the £23500 threshold as this will protect their loved ones from having to manage future funeral costs. 

*For advice on managing care home fees and trusts, we recommend talking to a qualified Estate Planner.