How to Plan an Affordable Funeral

No one likes talking about dying, which is why people often spend more than they should.

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Funerals, like weddings, are expensive affairs usually planned by people with very little experience. After all, with funerals at least, it's a once-in-a-lifetime event. Many people are unaware of their rights guaranteed by federal law, such as the right to receive price information from funeral homes over the phone. And they tend not to plan funerals, which often drives their price up, because people rarely have the time or inclination to shop around while grieving.

The average price of a funeral is $6,580, according to the National Funeral Directors Association. U.S. News spoke with Steven Kopp, an associate professor of business at the University of Arkansas, and Joshua Slocum, executive director of the nonprofit Funeral Consumers Alliance, about how to minimize sticker shock on what is usually an emotionally wrought purchase.

Why don't people plan funerals ahead of time, like they do with weddings?

Kopp: Many people have a resistance to even thinking about the events involved in dying and death. While it ought to be something that is more routine, it isn't. So it becomes a very stressful thing. I don't even have a will. It's a big enough deal that you ought to do it now, but most people don't.

What's the biggest financial mistake people make when arranging a funeral?

Kopp: Not shopping around. You can basically go a la carte for just about everything. You can buy caskets at Costco. There are all kinds of interesting alternatives. One Internet company makes [a casket] you can keep in your house, as a desk or a bookshelf, and when you die, that's your casket.

You can make it as elaborate or as simple as you want, in terms of headstones, urns, or cremation containers. You can have your ashes mixed with concrete and sink them to the bottom of the ocean, so they're in a coral reef, or shoot them out into space. There's a trend now toward green funerals, where there's no casket at all.

Slocum: Many people make a very bad mistake when choosing a funeral home. The top reasons they pick it is that they've used it before or it's close to their home. Neither is a rational reason. If you've never shopped around, you may be paying three times the right price. Don't be naive—be a shopper. I just did a price survey for the Princeton, N.J., area and saw the cost of a full-service funeral range from $2,500 to $6,500. I've seen a simple cremation range from $395 to $5,600.

After shopping around, don't prepay. It's a national scandal how much prepaid funeral money goes missing. [State laws protecting prepayments for funerals vary.] People can make the mistake of thinking, if they sign the check, kids won't have worries. But most times, in my experience, it sets kids up for heartache because it gives you, the consumer, an excuse not to have a frank conversation with your family. Elderly people, with the best intentions, prepay; then the kid ends up on the phone in tears, because there was no price guarantee, or the casket they chose wasn't available, or it's an extra $1,000. It's a heartache because they didn't read the contract and explain. Prepayment is a trap.

Are people's ignorance of the rules governing the funeral industry costing them money?

Kopp: There's no question that people end up paying for stuff that they don't need to pay for. While most funeral homes will be ethical about it, there will always be exceptions, in all industries. But if an individual knew what they were due, they might handle the whole process differently. That's the thing about encouraging planning. If you start thinking about it now, there's a lot less chance that you'll be taken advantage of. The fact you can have a simple funeral, but a good party afterwards is something people maybe need to think about.

What do people not know about the laws governing funeral homes? What should they know?

Kopp: The most important thing is that funeral homes have to give price information over the telephone. You can call around and shop. [Funeral homes] have to offer everything a la carte. You can't make people buy it as a package.

Slocum: The level of knowledge most people have about shopping for a funeral is really bad. The Federal Trade Commission's Funeral Rule gives consumers important legal rights. [In addition to the ones Kopp mentioned, the Funeral Rule also requires funeral providers to accept, free of charge, caskets purchased elsewhere.]

What else should people do?

Slocum: The next time you go to the grocery store, stop by a funeral home and pick up a general price list. Families need to have a conversation about what's important. A lot of people just go through the motions of a traditional funeral when they might not want it. Ask yourself, "Do I really want the body on display?" Don't do it just because it's expected.

On our website [www.funerals.org], we have a lot of information on how to decode funeral price lists and common myths and facts. Folks should check and see if there's a local Funeral Consumers Alliance. We have a directory on our website. They can make recommendations of ethical homes.