Prepaid funeral plans pros and cons in 2024

Updated 1st January 2024

If you prefer to make your own funeral arrangements, then it could be worth having a prepaid funeral plan. Having a plan in place can benefit your family, both emotionally and financially. But prepaid funeral plans do have their drawbacks, so it’s important to consider the pros and cons.

Are prepaid funeral plans worth it?

Prepaid funeral plans can be worth it if you have the funds available and want to pay in advance for your funeral service. There are several advantages in having one in place, but the three main funeral plan benefits are:

  1. It can save you and your family money if funeral costs increase
  2. Your family won’t have to arrange and pay for your funeral when the time comes
  3. You can pre-arrange the funeral you want at a price you want to pay

There are some disadvantages to funeral plans however which are listed in our pros and cons below.

pure cremation adWhat are the pros and cons of prepaid funeral plans?

Prepaid funeral plan pros

  • It can save your family money if funeral costs rise, or you live in an expensive area
  • Avoids cashflow concerns at the time of need
  • Freezes costs at today’s prices avoiding inflation
  • Prevents family from being ‘over sold’ services you wouldn’t want
  • Your family won’t need to make the funeral arrangements
  • You can choose the type of funeral you want
  • You can compare funeral plan prices and services to find the best one for you
  • Guaranteed acceptance regardless of your health
  • Portable if you move within the UK (if you choose a national plan provider)
  • Exempt from inheritance tax
  • Doesn’t count in means tested assessments for care homes
  • Flexible payment options with monthly instalments
  • After the initial waiting period on monthly plans, your chosen services will be provided even if you haven’t completed the payments
  • Regulated by the Financial Conduct Authority from 29th July 2022

Prepaid funeral plan cons

  • Could cost more if you live in a less expensive area or funeral costs go down
  • Doesn’t cover all costs such as the wake, flowers, memorial, embalming
  • Some funeral plans have limitations such as the location and time of the cremation
  • It may restrict your choice of funeral director
  • You may be charged extra if you move area
  • You might need the money
  • Unless you have a European plan, you won’t be able to use it if you move overseas
  • It may not be worth it and may cost more if you expect to die soon

What are prepaid funeral plans

Prepaid funeral plans allow you to make your funeral arrangements in advance, paying todays prices. Your money is held securely in a trust fund or insurance policy until required to pay for the services of a local funeral director, who will take care of everything as detailed in your plan when the time comes.

A prepaid funeral plan offers three main benefits:

  1. Saves money by avoiding rising funeral costs
  2. Removes the emotional and financial worry from your family of having to arrange and pay for your funeral
  3. Helps you arrange the funeral you want at a price you want to pay

Which may be why an increasing number of people think a funeral plan is a good idea. 

Are funeral plans regulated?

Funeral plans are regulated by the Financial Conduct Authority (FCA) who are responsible for the regulation of financial services in the UK. The FCA are there to protect consumers, protect financial markets and to promote effective competition in the interests of consumers.

pure cremation adShould I buy a funeral plan?

Whether or not you should buy a funeral plan depends on your personal circumstances and budget. If you want to arrange and pay for everything yourself, then buying a plan could be worth it. Families can struggle paying for a funeral, so making arrangements in advance could help.

If you are thinking of getting a funeral plan, it is worth considering all the pros and cons, comparing funeral plan prices and services, making sure your chosen company is registered with the FPA and understanding what is and isn’t included in the plan.

Who pays for your funeral when you die?

There is no law as such that states who pays for a funeral when you die but if plans are not already in place to cover the cost, it is usually down to the family or perhaps the executor of the estate.

If there are savings available, then the bank will usually allow payment to be made on receipt of the funeral director’s invoice. If no funds are accessible, then the person arranging the funeral will have to make the payment initially and then claim any money back from the estate once it has been settled.

What should I do now?

If you have just started looking at funeral plans and want to know more about the advantages and disadvantages, take a look out our funeral plan guide for more details.  

If you are ready to look at what plan providers have to offer, go to compare funeral plans.

Compare funeral plans

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