How to Pay for a Funeral
Funerals today can be extremely expensive. Many run as much as $10,000 or even more, which can cause a major financial burden on the survivors. In a perfect world, everyone would just have the cash on hand to cover all the funeral costs for a family member or loved one, but in reality, many people find that they don’t have the money to hand. Below are some of the alternative options to consider.
Insurance
If planning ahead is an option, adding burial insurance to your current life insurance plan or paying for a new plan is an excellent idea. Don’t forget to account for inflation, though—there have been many instances of ten- or twenty-year-old burial insurance plans not covering the cost in modern dollars.
Loans/Credit
Individuals with good credit can sometimes qualify for a loan to cover a family member or loved one’s funeral expenses from a specialized lending company. It’s smart to try to keep funeral costs as low as possible in this case, since you could be paying off the loan for a very long time otherwise.
Funeral homes will often extend credit with proof that there will be life insurance benefits paid or that the deceased’s estate will cover the expense. Be careful, though—the funeral homes sometimes charge high interest rates for the privilege. If you know there will be insurance or estate funds coming, a credit card with a low interest or introductory rate might be a better bet.
Get Assistance
Many states and local governments will provide some assistance for people below a certain income level. Your local city clerk’s office can tell you whether you qualify for this assistance. Keep in mind that these funds will not pay for a traditional, full-service funeral. In addition, some states won’t allow family members to contribute to the funds (assuming that contributions from family means they aren’t truly in need of assistance).
Social Security, Medicare, and Medicaid may also be able to help with funeral expenses for individuals who qualify. If the deceased was a veteran or a veteran’s spouse, the Department of Veteran’s Affairs will arrange burial in a VA national cemetery.
Keep Costs Down
Whichever way you decide to pay, it’s in your best interest to keep funeral costs as low as possible if money is an issue. Cremation is usually a less expensive option than a traditional burial. You can also save money on the memorial service—consider having a get-together at a park, church, or home instead of going through the funeral home.
Don’t forget, you aren’t obligated to go with the first funeral home you speak with. It’s a good idea to get price quotes from several so you can choose the one that’s least expensive.
It’s important to be up front about your budget right from the beginning with the funeral director. The good ones will help you stay within your means and figure out inexpensive alternatives to items and services if needed.