Covering the cost of having a funeral
You may have read the recent article on Stuff.co.nz about families forgoing funerals to cut costs. Many families are finding it difficult to cover unexpected funeral costs which are said to range from $8,000 to $11,000. While grants were available for low-income families of up to $2,000, it simply wasn’t enough to cover even the most standard funeral. We’ve outlined the cost of having a funeral, plus some options you might want to consider to make sure you’re prepared.
How much does a funeral cost in New Zealand?
According to Citizens Advice Bureau, the average funeral cost can easily cost $10,000 if not more, with most of it having to be paid immediately. The table below shows just the basic necessities when paying for a funeral. Some of the costs you need to consider are:
- newspaper notices to inform friends of the deceased
- the burial plot or cremation fees
- the coffin or urn
- transporting the body, including hearse fees
- venue fees for the church or funeral home
- the celebrant's or minister's fee
- the organist's (or other musician's) fee
- catering for the reception afterwards
- presentations e.g. audio-visual gear for videos, slide shows or audio presentations
- printing costs for service programmes
- portrait of the deceased to be displayed during the service
- thank you cards to send to attendees after the service
- death certificate
How are you going to pay for your funeral?
Being prepared is important, and it means that your family won’t have to deal with such a burden on top of an already upsetting situation. Having a funeral plan in place will alleviate the stress your family will be under.
Start putting money away
You might want to start putting money aside into a savings account, and ensure that a family member will have access to it after you’ve passed away. Having a will in place can help make sure your wishes are taken care of.
Set up a funeral trust
With a funeral trust you can start making payments which are made available when you pass away. You often need a minimum of $2,000 to set up the trust and you may have to pay establishment and annual management fees depending on the provider.
Consider funeral insurance; take the stress off your family
Funeral insurance is another simpler option, and it’s easy to sign up for. By putting a little money aside per month towards your policy, an elected beneficiary can have immediate access to anything between $5,000 and $15,000 (depending on how long you’ve had your policy).
You can pay as little as $21 per month for $5,000 worth of cover with Cigna’s Funeral Cover Insurance, depending on your age and whether or not you smoke. You won’t have to take any medical tests, and acceptance is guaranteed if you are aged between 55 and 85 and a New Zealand Citizen, or permanent resident.
Get more information
Before you take the plunge, you might want to research funeral insurance options. Take a look at the Citizen’s Advice Bureau for some useful advice on funeral plans, or the Funerals New Zealand website.