17th April 2015
Thousands of families could be sitting on a funeral time bomb by failing to set aside money to cover the rising costs of funeral expenses.
A new report by the International Longevity Centre (ILC) and Engage Mutual predicts a sharp upturn in the number of deaths over coming years as the oldest babyboomers die.
It believes 2015 is a ‘tipping point’ where the historic trend for falling death rates reverses and the number of deaths will rise 20%.
The reversal of this trend will have a significant impact on funeral costs and highlights the need for families to talk about covering the cost of a funeral to ensure children and grandchildren are not left with a bill they cannot afford.
The conversation is even more important considering the 80% rise in the cost of a funeral between 2004 and 2014.
The report said that an increase in deaths would put pressure on funeral services and push prices higher and the average cost of a funeral in 2020 will be £5,226 by 2020, rising to £7,000 after this time.
It also predicts funeral debt, where money has been borrowed to cover the cost of a funeral, will rise to a quarter of a billion over the next 20 years.
A total of 109,000 UK adults incurred debt as a result of a funeral in 2013, with the average debt standing at £1,305 and in the same year total funeral debts equalled £142 million.
Baroness Sally Greengross, chief executive of the ILC, said: ‘More than half of UK households have less than £3,000 in savings and many will struggle to cover funeral costs.
‘We all need to talk more about dying and ensure we are prepared for the inevitable. State support for funerals is complex and inadequate and without reforms will contribute to more people falling victim to funeral debt.’
Nearly a quarter of people who have arranged a funeral in the past five years had to do so without financial provision being made by the deceased and government funeral payments have not kept up with costs. In 2012, the payment awarded was just 37% of the total cost of a simple funeral.