Thursday, January 25, 2007

Funeral costs

Who pays for funeral costs? In hawaii they have this thing where you give money "koden" when a person dies to help the family defray the funeral costs. Imagine according to the National Funeral Directors Association the average cost of a funeral as of July 2004 was $6500. I believe it. Plus you have the costs associated with dying in the hospital, which is morbid, but true.

So what if you cancelled your term life insurance or it ran out? Where do your funeral costs come from? I guess this monetary gifts from people who attend the funeral is to help the immediate need for cash. It's possible that many people do not have the cash on hand or are not joint owners on the account for immediate access to the money.

In the case of my family, truth is that my grandmother couldn't afford the funeral costs. They didn't have much money period. Thankfully my mom and her siblings do, so the monetary gifts are a blessing.

I guess if I were to die, I don't have any life insurance so it would be entirely out of pocket. Which I guess my DH would put on our CC and then pay it off as he accessed our cash. Fortunately everything is joint so he could transfer the money out our taxable accounts. If he died I would do the same, but he does have life insurance through work, so I think I would be better off than him.

How do most people plan on paying for funeral costs? What do you think your funeral will costs and is this something people have considered?

2 comments:

Lux Living Frugalis said...

hi living almost large - we have already paid for our burial plots and have a small slush fund that we are contributing to towards our funeral costs and headstones.

It is morbid but an area of financial life that many overlook.

~~LuxLivingFrugalis

scarlet reynolds said...

Hiring funeral directors is the best way to ensure funeral security and peace of mind. During the loss, it will be a great relief and to know that family,relatives and close friends can console each other better as the funeral arrangements are well taken-cared of by a reputable
funeral director.