Is Pre Paying Your Funeral A Good Idea?

Is it financially beneficial to take out a Pre-Paid Funeral Plan, or should you leave it to be handled by your loved ones after you pass? This article by G. Seller will help answer those questions and hopefully clarify the benefits and potential drawbacks of prepaying your funeral.

By the end of it, you’ll be able to make an informed decision that suits your needs and preferences, when it comes to such a delicate topic. It is important to note that Funeral Plans are regulated by the Financial Conduct Authority (FCA), as of the 29th July 2022. This means that anyone providing a funeral plan has to be authorised to do so by the FCA.

G. Seller proudly work in association with Golden Charter. G. Seller are appointed representatives of Golden Charter who are regulated by the FCA.

When it comes to your funeral, you have different options available to choose from. There are trust fund backed funeral plans as well as whole life assurance policies.

A lot of funeral plan providers offer Set Plans which only provide pre-configured options with allowances towards costs, such as the crematorium fees.

G. Seller provides The Independent Way funeral plan which allows you to configure everything to your requirements, no matter how simple or unique. G. Seller’s funeral plan consultants will be able to go through all your arrangements and give you an itemised quotation, making sure you get Your Funeral, Your Way.

A funeral plan is broken down into two parts; professional services and 3rd party costs (disbursements). G. Seller guarantee the professional services at today’s prices, so no matter how much they increase over time, they are fixed at that day’s price. 

An over 50’s policy pays out a lump sum on death, which can be used towards the funeral. But as the lump sum is fixed at the outset of taking out the plan, any potential increase in funeral prices could mean the payment won’t cover the cost of the funeral. 

Pre-planning your funeral is something that can certainly have a number of benefits. 

• Your money is safe. It is paid into a well managed trust fund called the Golden Charter Trust. The trust is overfunded, so if all planholders pass away, there is still over £100 million left over. 
• Guaranteed professional services.
• No uncertainty about your final wishes which means it will alleviate the worry and stress on your loved one’s for deciding what you’d have liked.
  "Less than 1% of people knew their loved one’s wishes"
• Potential growth on third party costs, used to pay towards increases in costs 
• Flexible ways to pay.

There are a number of ways you can pre-pay for your funeral. Depending on your financial situation, some may work more to your liking than others.

You can pay in a one off single payment.

If you would prefer to spread the cost, you can pay over 12 monthly payments by Direct Debit at no extra charge. You will be covered once all payments are made. 

For a lower monthly payment, you can also choose to spread the cost of your plan over 2 to 15 years. 

This option includes the added benefit of the Golden Charter Pledge, which ensures that if you pass away at any time after you have made 12 consecutive payments, the benefit of your plan will be provided, with no further payments to be made. 

Depending on the type of funeral plan will depends on the potential risks. 

Funeral plans paid into a trust fund:

• The funeral plan isn’t legally binding, so your next of kin could change all of your wishes. In G. Seller’s experience there is very little chance of this though. 
• Third Party costs could rise a lot and higher than the rate of growth in your plan. In this situation your family would be asked to pay the difference. In G. Seller’s experience, this could be hundreds rather than thousands of pounds and also if it is an Independent Way Plan, then the difference to pay is usually minimal. 
• More money was paid into the plan than what the funeral eventually cost. There is no right for the funeral director to pay the extra back to the family. However, G. Seller make the pledge where the third party costs in the plan are higher than the actual costs at the time, G. Seller will refund the costs back to the family. 

It’s clear that a pre-planning funeral is suitable for many. It relieves the worry and financial burden that can come when paying for a funeral of a loved one. For more information and a no obligation appointment, please contact the funeral planning consultants at G. Seller to find out more on 01455 637457 or office@gseller.co.uk.