Death is one of life’s certainties, yet it remains a topic many of us find difficult to discuss. However, planning for your funeral is increasingly recognised as a thoughtful and practical step—one that can spare your loved ones emotional and financial stress during an already challenging time.
What Are Pre-Paid Funeral Plans?
A pre-paid funeral plan allows you to arrange and pay for funeral services in advance, either as a lump sum or through monthly instalments. Plans typically cover essential funeral director services: collection and care of the deceased, administration, viewing facilities, the coffin, hearse, funeral cars, and support throughout the process.
In the first six months of 2025, over 100,000 people took out prepaid funeral plans—nearly 14% more than the year before. Around one in five UK funerals is now paid for through a plan arranged in advance.
Understanding Funeral Costs
Funeral expenses have risen considerably over the past twenty years:
- Basic funeral costs are up 134% since 2004 (compared to 75% general inflation)
- London: £5,449 average
- Northern Ireland: £3,441 average
- Total cost including estate administration: £9,797 average
Regional Cost Variations of Prepaid Funeral Plans
| Region | Average Funeral Cost | Annual Change |
| London | £5,449 | +5.4% |
| South East & East England | £4,943 | +6.5% |
| Scotland | £4,345 | +7.8% |
| North West England | £4,297 | +13.0% |
| Northern Ireland | £3,441 | +5.7% |
Contact us to know the exact cost.
How Pre-Paid Plans Work
Cost: Paying for a funeral plan at today’s prices means locking in the current costs, so you don’t have to pay more later if prices continue to rise. This can help fix funeral director prices at the time of purchase to avoid paying more if prices increase later.
Supporting Your Family: Having arrangements in place means loved ones do not have to make difficult decisions or handle payments during an already difficult time.
Your Wishes: Everything is documented—the type of service, specific music or readings, and other personal preferences.
Payment: Plans can be paid in one go or spread over monthly payments. They are available for UK residents aged 18 and over.
What Prepaid Funeral Plans Typically Cover
Most plans cover the funeral director’s core services, but not necessarily everything:
Typically Included
- Funeral director services and staff
- Collection and care of the deceased
- Coffin and hearse
- Contribution toward venue and celebrant fees
- Basic administration
Often Not Included
- Cemetery or crematorium fees
- Memorial stones or plaques
- Flowers and catering
- Additional vehicles
- Upgraded options
Points to Consider
While pre-paid funeral plans can be helpful, there are some limitations to keep in mind:
Limited Flexibility: Once arranged, making changes can be difficult or costly. It is important to be comfortable with your choices before committing.
Provider Dependency: Plans are tied to the chosen provider. While FCA regulation offers protection, it is worth researching a provider’s financial stability and reputation.
Portability: If you relocate, transferring a plan to a new area may incur additional costs or complications, though most plans are fully transferable.
Third-Party Costs: While funeral director costs are locked in, third-party costs such as crematorium or celebrant fees may still increase over time.
Choosing a Pre-Paid Funeral Plan
Verify FCA Authorisation: Check that your chosen provider is authorised by the Financial Conduct Authority using the Financial Services Register.
Compare Coverage Options: Understand exactly what is included in different plan tiers and what additional costs you might face.
Review Financial Stability: Research your provider’s history, financial stability, and customer reviews.
Understand Terms and Conditions: Carefully review all contract terms, particularly regarding changes, cancellations, and transferability.
Consider Local Providers: Local funeral directors often provide more personalized service and community connections.
Questions to Ask Providers
- What exactly is covered in this plan, and what is not?
- How are funds protected if the company fails?
- Can changes be made to the plan after purchase?
- How does the plan work if I change my address?
- Are there any additional costs to expect?
- How long has the company been operating?
- Can the plan be cancelled if circumstances change?
Consumer Protection Resources
Financial Ombudsman Service: Free complaint resolution for issues with funeral plan providers.
Financial Services Compensation Scheme: Automatic protection for customers of failed funeral plan providers.
Citizens Advice: Local guidance on funeral planning and consumer rights.
Frequently Asked Questions
1. Who Can Purchase a Pre-Paid Funeral Plan?
Any UK resident aged 18 or over can purchase a funeral plan. For instalment plans, the final payment typically must be completed before your 85th birthday. No medical examinations or health questions are required.
2. Can I Get Tax Relief on a Pre-Paid Funeral Plan?
No, you can’t claim tax relief on a funeral plan like you would on a pension contribution. However, paying for your funeral in advance can help you financially in other ways:
Reducing Inheritance Tax: When someone dies, their funeral costs can be deducted from the value of their estate before calculating any Inheritance Tax. This could mean your family pays less tax overall.
Protecting Benefits: If you receive benefits like Pension Credit, Universal Credit, or Housing Benefit, the money in a funeral plan doesn’t count as savings. This means it won’t affect whether you qualify for these benefits, unlike cash sitting in a bank account.
Care Home Funding: If you need to apply for help paying for care, your funeral plan usually isn’t counted as an asset. The local authority will ignore it when deciding if you qualify for support—unlike savings or property that could disqualify you from assistance.
Protecting Your Savings: A funeral plan protects money for its intended purpose while keeping it separate from your other assets. This is especially helpful since you can only have £16,000 in savings for most benefits, and £23,250 before paying full care home costs.
In simple terms, a prepaid funeral plan helps by ensuring the money you have set aside for your funeral doesn’t reduce your eligibility for important government benefits or care funding, and it may also reduce tax on the assets you leave behind.
3. What Happens If I Die Within Two Years of Purchase?
FCA regulations require providers to offer a full refund if you die within 24 months of purchasing a plan, unless you have paid for at least 12 months of instalments. Some providers, including Co-op and Dignity, will honour the funeral arrangements even within this period.
4. Can I Change My Plan After My Purchase?
Most providers allow some changes, but options may be limited and costs may apply. Major changes might require upgrading to a more comprehensive plan. Review the terms and conditions carefully before purchasing.
How Gooding Funeral Service Can Support You
At Gooding Funeral Service, we guide families through the process of understanding and arranging pre-paid funeral plans. We can help explain the different pre-paid funeral plan options and answer any questions you may have about the process.
Planning ahead is one of the greatest gifts you can give your loved ones – the gift of time to grieve and remember, rather than worry about arrangements and expenses during their most difficult moments.
Read more from our guide on funeral services in the UK.
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