When a loved one passes away, the financial burden of a funeral can weigh even heavier on an already difficult time. According to the National Funeral Directors Association’s (NFDA) 2023 Member General Price List Survey, the average cost of a funeral including a casket and burial has risen to $8,300, a 5.8 percent increase over the past two years. Similarly, the average cost of a funeral including cremation, including an alternative cremation casket and urn, has risen to $6,280, an 8.1 percent increase. As funeral costs continue to rise, planning ahead with life insurance can help ease the financial burden on grieving families and better prepare them to deal with these expenses.
How much does the average funeral cost?
According to the Federal Trade Commission (FTC), there are several fees that can affect funeral costs.
- Basic service fee: This is the standard service fee associated with a funeral, which includes planning costs such as permit fees and administration fees.
- Service and product charges: These include transportation, preparation, embalming, and storage of the body, funeral home fees for the interment and memorial service, equipment and services required for the cemetery ceremony, etc. You will also have to pay for a coffin or burial container, and any services required for cremation or burial.
- Cash advance: These fees are for the services the funeral home arranges for you, such as funeral flowers, a clergyman, an organist, etc. You may pay additional service fees or surcharges depending on the efforts of the funeral home, but any additional fees must be disclosed to you in writing.
According to Lincoln Heritage, the average casket costs between $2,000 and $5,000, but premium caskets such as Promethean Bronze can cost as much as $22,000.
Some buyers choose to buy the casket themselves to avoid third-party price gouging; however, the cost of shipping the casket to the funeral home is out of pocket, which can be expensive. If you choose cremation, you can avoid the cost of a new casket. Most funeral homes will rent a casket for use at the wake or funeral as a more cost-effective option if other burial options are available.
Below are some of the average funeral costs you may incur, according to NFDA’s 2023 data.
- Funeral expenses: $2,495
- Funeral home rental fee: $475
- Visitation by funeral home staff: $475
- Funeral home staff (ceremonies): $550
- Beauty services: $295
- Safe: $1,695
- Embalming: $845
- Cremation: $400
- Alternative cremation vessel: $150
- Urn: $295
- Hearse: $375
- Transporting a body: $395
- Family transportation: $175
- Brochures and materials: $195
The FTC provides a funeral pricing checklist to help you with the funeral process.
Average funeral costs by region
The average cost of a funeral varies by state. Every year, the NFDA releases a General Price List Survey. Below are the results of the latest report based on 2023 data.
2023 NFDA Average Funeral Costs by Region
| New England (Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, Vermont) | $8,985 | $7,023 |
| Middle Atlantic (New Jersey, New York, Pennsylvania) | $8,537 | $6,498 |
| South Atlantic (Delaware, Florida, Georgia, Maryland, North Carolina, South Carolina, West Virginia, Virginia) | $8,023 | $6,103 |
| East South Central (Alabama, Kentucky, Mississippi, Tennessee) | $7,615 | $5,858 |
| Southwest Central (AR, LA, OK, TX) | $7,912 | $5,890 |
| Northeast Central (IL, IN, MI, OH, WI) | $8,280 | $6,120 |
| West North Central (IA, MN, KS, MO, ND, SD, NE) | $8,755 | $6,713 |
| Mountains (Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Utah, Wyoming) | $7,390 | $5,505 |
| Pacific (Alaska, California, Hawaii, Oregon, Washington) | $7,835 | $5,812 |
While funeral costs have increased over the years, recent data shows that the average funeral cost has not risen as rapidly as overall inflation. However, this is likely a temporary difference and funeral costs may rise further in the future.
No matter where you live, cremation tends to be less expensive than burial, but some places are more affordable than others.
How to prepare for funeral expenses
For many people, death comes without warning, leaving loved ones grieving while also facing the enormous costs involved. That’s why financial planning is so important. There are a number of ways to prepare for funeral expenses, to give your family peace of mind.
Life Insurance
Purchasing life insurance is one way to cover funeral expenses while you’re alive. Depending on the policy, the death benefit (or payout) your beneficiaries receive after you pass away can cover all or part of your funeral expenses. A high amount of insurance may also leave your beneficiaries with additional funds to cover larger financial obligations like child support or a mortgage.
There are many different types of life insurance available to help you plan for end-of-life expenses.
- Term Life Insurance: Provides coverage for a specified period, such as 10, 20, or 30 years, at a fixed fee. Generally affordable, but pays out only if the policyholder dies during the policy term. Designed to provide financial protection against unexpected death.
- Whole Life Insurance: It provides lifelong coverage up to age 95 to 121, as long as you keep paying the premiums. It also includes a cash value component that gradually grows over time. However, this cash value is not a direct savings account for the beneficiary, but an asset that the policyholder can access during his or her lifetime. Upon death, the beneficiary receives the death benefit, not the accumulated cash value.
For those looking for lifelong protection and the benefit of financial assets over their lifetime, whole life insurance may be an option to consider, but it’s important to keep in mind that whole life insurance tends to be expensive and requires a long-term commitment.
Whole Life Insurance
Whole life insurance, also known as burial insurance or funeral insurance, is a special type of life insurance designed to cover expenses related to end-of-life expenses. This product is especially beneficial for individuals with serious medical conditions who may be denied traditional life insurance coverage. Unlike traditional insurance, whole life insurance does not usually require as rigorous underwriting, making it more accessible to people who may not qualify for other types of coverage.
Whole life insurance death benefits are usually small, ranging from $5,000 to $25,000. This amount is usually just enough to cover funeral expenses such as burial, cremation, and other related services. While the primary purpose of whole life insurance is to cover these end-of-life expenses, your beneficiary can also use the remaining funds for other outstanding expenses such as medical and legal fees. However, it is important to note that because these policies are easy to obtain, premiums are often high compared to the amount of coverage.
Other ways to pay for funeral expenses
Besides life insurance, there are other ways to cover funeral expenses.
Traditional savings account
You can always use a traditional savings account for funeral expenses. The advantage of a savings account is that the money is kept safe and can be accessed at any time. However, because probate can cause delays, those paying for funeral expenses may have to find other ways to pay for the funeral until the deceased’s assets have been valued.
Payable on Death Account
A payable on death (POD) account is a better option than a traditional savings account. It allows you to set up a special funeral savings account. You name the person you want to manage your funds after you die, and they can access the funds simply by presenting a valid death certificate. Once the beneficiary presents the death certificate, the funds are available immediately and there is no need for the account to go through probate.
Military burial benefits
Military personnel are eligible for special burial benefits, while others can choose a bank loan or a pre-paid plan with their funeral home of choice.
You can also consider military benefits such as the Gratuity Death Program, which provides tax-free compensation of up to $100,000 to those who die while on active duty or in certain reserve positions, as well as a burial allowance of $300 for non-service-connected deaths and $2,000 for service-connected deaths.
Advance arrangements
Writing a will is another way to prepare for your death, including specifying how your funeral should be conducted and information on how funeral expenses should be paid for.
In a will, you can also specify that certain assets you leave behind go to the right people. You can also state in your will that you want one of your assets to be sold to a specific family member to help pay for your funeral expenses.
How to keep funeral costs low
Even if you have undertaken financial planning or taken out life insurance to cover funeral costs, it is important to consider which expenses are worth the expense. If you believe there will be other expenses that take priority over a lavish memorial after you pass away, it is a good idea to consider ways to keep these costs low and communicate your wishes to your family.
Below are some strategies that can help keep funeral costs affordable.
- Shop around to find the best price. Like anything else in life, not all funeral homes charge the same amount, so shopping around can save you money in the long run.
- Choose cremation and provide your own urn. Cremation is generally less expensive than embalming and burial, making it a great cost-saving option, but buying or obtaining a container to use as an urn in advance can save you hundreds of dollars.
- Consider donating your body. In the name of advancing medical technology and scientific research, some medical schools will pay for the acquisition of bodies after death for use in medical research. This could be a great way to help scientists understand how different diseases and conditions affect the human body.
