Abi Pattenden, Manager of Freeman Brothers Funeral Directors
Freeman Brothers Funeral Directors is marking Dying Matters Awareness Week 2021 in several ways. The company – whose West Sussex offices are located in Billingshurst, Crawley, Horsham and Hurstpierpoint – is running two online events to support this year’s theme of ‘Are you in a good place to die?’. In addition to the wider theme, members of the public are being asked to consider how this relates to a particular topic each day. Today, Abi tackles the meaning of being in a good place to die… financially.
Like so many other issues relating to death and dying, the idea of being in a ‘good’ financial place to die will mean different things to different people, and it’s likely that it will cover a spectrum of eventualities.
Firstly, let’s address the elephant in the room: for some, there is no necessity to consider financial planning for their death. I have known people to express the view that once they are dead they don’t care what happens to their body and so whoever makes the choice should pay. There is also the argument that ‘they’ (an unspecified public organisation) will have to do something with a body sooner or later and so there is no need to plan ahead. There is a sense in which this is correct. Local Authorities do have a responsibility to pay for a funeral where no-one else can. Funerals vary in price, but even choosing the minimum has a cost implication which is therefore being left to others.
I think most people feel that making some kind of provision is the right thing to do – if not, then financial services companies would not advertise Over 50s plans as a way of ensuring there’s money for your funeral.
One of the ways to ensure financial preparedness is by making a Will, to ensure assets go to the desired beneficiaries. At least one person is named in the Will as Executor to it and it is their responsibility to ensure that the instructions within it are carried out.
Wills should be updated regularly- and any time that circumstances affecting the estate or its beneficiaries alter. You can buy a Will Kit for about £25 but these are not suitable for all circumstances. Most people use a solicitor, and incur the resultant cost, although it is sometimes possible to take advantage of a charity’s promotion to have one drafted for free in return for a donation.
The main advantage of a Will is that it is a legally-binding document and you know that your assets will be dealt with as you intended by someone you trust. However, some people may not see the benefit of a Will if they have few assets – or if they believe that what they do have will be used as intended. Research consistently suggests that about half of us don’t have a will, so they’re clearly not something that everyone sees the benefit of.
Knowing there are funds in place for when the time comes might feel like a ‘good’ place to be in, and this is where life insurance and assurance work. The main difference between these two similar-sounding things is that life insurance is usually finite – premiums are paid monthly for a specific period of time until a set date. For example, mortgage providers might require life insurance as a lending condition, enabling the estate to receive a payout of the outstanding value of the mortgage upon death of the customer. The insurance therefore expires once the mortgage is paid in full.
By contrast, life assurance ‘assures’ you that you will receive a payout in future, but in return for this, the premiums are paid indefinitely. ‘Over 50’ plans, often advertised as being to help with funeral costs, are an example of this. They work by a fixed sum being paid monthly until the policyholder dies, and paying out an agreed amount at that time. A downside of this is that the policyholder may end up paying more than they receive; another is that the payout is a fixed amount so its value will fall if inflation rises. However, they often involve low monthly premiums, making them accessible to people who may not be able to afford alternatives. Their other advantage is that there is no designated use for the funds. They don’t have to pay for a funeral if a better solution is found.
The purchase of a pre-paid funeral plan is in some ways the opposite of this. Instalments don’t continue once the plan has been bought and, if it is fully guaranteed, you receive the funeral you want, regardless of how inflation has affected its cost. Not all plans offer this full guarantee. Many people who take out Freeman Brothers’ fully-guaranteed plans tell us that, for them, the biggest benefit is the peace of mind they feel. Obviously, this might be somewhat mitigated if there are not full guarantees in place and so it’s very important that the terms and conditions of a plan are fully understood.
As with other options outlined above, pre-paying the funeral doesn’t mean that there’s nothing to do later. There is usually statutory paperwork to be completed and, if there is an officiant, they will want to know about the person who has died. Unlike the options mentioned above, because you receive your chosen funeral rather than a sum of money, paying for your funeral in advance necessitates you laying out your wishes. It can be hard to talk about your own funeral for various reasons (including unwillingness on the part of others to enter into the discussion!), so this provides an opportunity to record your preferences. This may well be a significant contributor to feeling that you are ‘In A Good Place to Die’.
In an ideal world, people might have more than one of these solutions in place- perhaps a way to pay for their funeral and other associated expenses, and also a Will to ensure that instructions for these funds are clearly set out. However, the concept of being in a Good Place to Die is, at its essence, subjective, as is our opinion of how financially prepared we are for any eventuality. This is another reason why discussing funeral wishes with those close to you is important because, while your level of preparedness is up to you, it is worth those who may well have to arrange your funeral knowing how far this extends. Opinions will vary but I personally feel that if I was expecting someone else to pay for my funeral, I would expect to have less of a say in it.
I can only conclude by reporting that many people who I have helped to arrange a funeral which had been paid for in advance, or where they otherwise had concrete information about the financial plans of the person who has died, have told me how much easier it has made that part of everything for them. Being in a Good Place to Die financially puts others in a better place, too.