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The unconscious beliefs we hold around money affect our financial choices throughout our lives – and beyond. Our money scripts have an impact on the way we think about final expenses for our loved ones and ourselves.
I was reminded of this as I read about a recent survey conducted by Choice Mutual, an insurance company specializing in funeral insurance policies. The survey’s focus was on the impact of inflation, and it found that 28% of respondents had changed burial or funeral plans because of increases in the cost of living.
Other findings in the survey revealed various ways our money scripts affect our funeral planning.
- If money were not a factor, 68% of respondents would change their funeral plans. The leading choices were more traditional burials and cremation, the two most expensive options.
- Not surprisingly, given the source of the survey, 39% of respondents planned to pay for their last expenses with funeral insurance or a prepaid funeral plan. While this can be a helpful way to cover funeral costs, pay attention to the fine print before buying any plan or policy.
- When asked if they had ever been burdened by the costs of a loved one’s funeral expenses, 39% answered “yes.” This mirrors a recent study in the U.K., cited by Yahoo, that reported 43% of adults had gone into debt or experienced financial hardship to pay for a funeral.
- “Let their family figure it out” was the method that 23% of respondents chose to address final expenses. If this is the plan your family members are following, a discussion might be in order.
The survey also showed changes in funeral arrangements from 2020 to 2023. More Americans choose cremation (now 37%) over the traditional casket burial (29%). The popularity of an even less expensive option, the natural or “green” burial, has gone from 4% in 2020 to 11% in 2023, indicating Americans are increasingly willing to consider alternative burial methods.
There is certainly a considerable savings with alternative burial methods (direct burial or cremation, casket rental, DIY funerals, and purchasing a casket online). The Washington Post reported that families would save an average of $5,000 to $6,000 by selecting an immediate burial without embalming rather than a traditional burial. According to Forbes, direct cremation is the cheapest and most common cremation method in the U.S. The average cost of an alternative burial is $2,000, versus $7,000 for cremation and $10,000 for the traditional burial.
Perhaps the most powerful money script affecting our funeral choices is a belief that “spending more equals love.” Josh Slocum, executive director of the Funeral Consumers Alliance, coauthor of Final Rights: Reclaiming the American Way of Death, and a harsh critic of the funeral industry, put it this way in a June 2018 interview at Digital-Dying.com: “We are led to believe that we might not care as much about our parents unless we have X, Y, Z but these are all made up stories we allow ourselves to be told . . .” He added that “. . . grieving mourners have to make adult choices.”
One problem with this advice is that grieving mourners are often overwhelmed and not in a position to make logical choices, so money scripts may well drive their decisions. I can appreciate that funeral costs probably are not a topic anyone is eager to discuss with loved ones or financial advisors. Yet planning and considering the options ahead of time is important. It helps you or your family members reduce stress, avoid family conflict, and make decisions that can support someone’s final wishes without leaving a financial burden.
Rick Kahler, MS, CFP®, CFT-I™, CeFT®, CCIM, is the founder of Kahler Financial Group, a Rapid City, SD-based fee-only Registered Investment Advisor.
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Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
