Funeral debt almost hits £150m
- New National Funeral Cost Index reveals funeral debt reaches £147m
- People are looking at cheaper options including direct cremations
- There is a postcode lottery for funeral costs which range from £2,898 to £6,422
The latest Royal London National Funeral Cost Index reveals funeral debt in the UK has risen to £147m as people borrow from friends and family or the bank to fund the last wishes of loved ones.
Royal London’s research highlights that the average cost of a funeral in the UK is now £3,675, with 93,359 adults taking on funeral debt. The average debt being taken on to cover funeral costs is £1,601, which collectively equates to £147m across the UK.
One in seven (15%) said they struggled with funeral costs. Amongst those who struggled, one in four said they borrowed money from family and friends (27%) or went into debt by taking out a loan or going into their overdraft (24%) to pay funeral costs.
Data obtained from the Institute of Cemetery & Crematorium Management highlights the postcode lottery on funeral costs. The cost of a funeral differs depending on where you live in the UK, with charges ranging from £2,917 for a burial in Belfast, to £9,679 for a burial in Kensal Green in London. Cremation costs are significantly lower in comparison to burials, with Greenock in Scotland (£2,873) being the cheapest.
The research also found consumers are using different coping strategies to keep costs down, with 5% choosing to have a direct burial or direct cremation, which is a radically different and cheaper option. While direct cremation and direct burials aren’t offered by the majority of funeral directors, the findings show that there is a clear demand for it.
Commenting on the findings Mona Patel, Royal London’s consumer spokesperson, said:
“When dealing with the loss of a loved one, the last thing that people need is financial stress as well. It is shocking that more than 90,000 people had to borrow an average of £1,600 simply to give their loved ones a decent send off. It is vital that the Government tackles funeral poverty by addressing the flaws with the Social Fund Funeral Expenses Payment. This includes the length of time it takes to get a payment which then often falls far short of the cost of the funeral. The funeral industry also needs to address consumer demand for a simpler and cheaper funeral option, by providing more access to direct cremation and direct burials.”
Nick Willcocks, Co-ordinator at yourfuneralchoice.com, said:
“A growing number of people are struggling to meet funeral costs, but there are affordable options available across the UK, and with a little looking around it is possible to find firms that will meet your budget. We encourage individuals to speak to two or three firms directly, get a feel for them and then make a choice.
“An increasing number of people are choosing to separate the cremation from the celebration of life and through direct cremation this invariably provides a more affordable but no less dignified alternative to a traditional, attended funeral.”
Royal London is calling for:
- Policymakers in England, Wales and Northern Ireland to follow Scotland’s lead and do away with doctors’ fees;
- Westminster to adopt the pathway set by the Burial and Cremation (Scotland) Act 2016, providing permission for the sensitive re-use of abandoned old graves, to alleviate the pressure on unsustainable cemeteries;
- Department for Work and Pensions to continue its proactive work on the Social Fund Funeral Expenses Payment by addressing the process flaws and value, not just the speed and complexity issues;
- The funeral sector to respond to the latent demand from consumers for simpler and cheaper funeral options, by providing more access to direct cremation type services.
In the UK, the average cost for a cremation funeral is £3,214, comprising: £716 (cremation) + £164 (doctor) + £143 (minister) + £2,208 (funeral director)
In the UK, the average cost for a burial funeral is £4,136, comprising: £1,785 (burial) + £143 (minister) + £2,208 (funeral director)
Note: the doctor’s fee does not apply for funerals in Scotland
Top 10 most expensive locations for funerals:
Top 10 cheapest locations for funerals:
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Notes to editors:
- Royal London’s National Funeral Cost Index is an annual study. The 2016 Index is available here: www.royallondon.com/about/media/research-and-consultation-responses/ along with the 2015 report.
- The Royal London National Funeral Cost Index is published in partnership with The Institute of Cemetery and Crematorium Management (ICCM) – the organisation which represents professionals working in burial and cremation authorities and companies throughout the UK.
- Royal London commissioned two surveys from YouGov which took place from May to June 2016. The first was made up of 2,003 nationally representative UK adults aged 18+ who had organised a funeral within the past five years and had used the services of a professional funeral director. The second was made up of a random sample of 1,034 UK adults aged 18+ who had organised a funeral within the past five years and had used the services of a professional funeral director.
- ICCM surveyed 275 crematoria in the UK to ascertain their costs for cremation. Fieldwork for ICCM took place between April and June 2016.
- Yourfuneralchoice.com provided data which is based on mystery shopping of funeral directors to gather information and prices for a comparable ‘simple funeral’ to include collection/care of the deceased, a basic coffin, hearse, and to manage a simple service at a crematorium. Prices based on this research do not include third party costs which fall outside of the funeral directors immediate control or minister/celebrant fees.
About Royal London:
Royal London is the largest mutual life, pensions and investment company in the UK, with Group funds under management of £93.8 billion. Group businesses provide around 9.1 million policies and employ 3,106 people. (Figures quoted are as at 30 June 2016).