The last few years have been hard for many people financially. Inflation has ticked up at a record pace at a time when many goods and services were already barely affordable. Even higher wages haven’t been enough to offset the cost.
For some low cost expenses, like a loaf of bread or gallon of gas, it hurts in the wallet and can add up, but many people are able to cut corners to make ends meet. With bigger expenses, like funeral services, that isn’t always the case. It can be hard for many families to come up with the funds to cover the total upfront cost of funeral home services, but handling the disposition is an absolute must.
Fortunately, today there are cheaper alternatives to traditional funeral services and more ways to pay for them.
Why Many Americans Can’t Pay for Funeral Expenses
Rising costs aren’t the only reason more families are having difficulty paying for funeral services. There are a few other contributing factors that are putting a strain on financing a funeral.
Majority of American Families Live Paycheck to Paycheck
Over half of Americans live paycheck to paycheck. According to research from LendingClub Corporation that analyzed holiday spending in 2022, 60% of American adults lived paycheck to paycheck at the start of 2023.
What’s just as newsworthy is that this is happening at all income levels across the country. Around 40% of high income earners are included in the paycheck-to-paycheck group.
Only Half of American Adults Have Life Insurance
Another issue is only 52% of adults in the U.S. have life insurance that could cover the cost of funeral services. This includes both workplace and individual life insurance plans.
Many of the 60% of people who are living paycheck to paycheck fall into the half that also don’t have life insurance. The families members of these individuals are left to cover all of the funeral costs if arrangements weren’t prepaid.
Alternative Ways to Pay for Funeral Services
If you don’t have the funds upfront to pay $6,500+ for traditional funeral services you’re not alone. Many families are choosing direct cremation because it is much more affordable by simply omitting the services that are hosted at the funeral home.
At $1,000-$2,500 on average, direct cremation is much less expensive, but it’s still a sizable expense for many people.
Arrange Services in Advance for Lower Costs and Payment Plans
Many funeral service providers allow people to arrange services in advance, often for a discounted price. You may also be able to arrange a payment plan with the funeral home so that services are paid for overtime.
Credit Cards Can Be Used
Because direct cremation is available for just $1,000-$2,000 it’s possible to put the expense on a credit card if needed. Just watch out for the interest rate costs associated with this payment option. If possible you can take advantage of 0% interest balance transfer promotions that allow you to pay off the funeral costs for a period of usually 6-12 months interest-free.
PayPal Pay in 4 and Pay Later Options
More funeral homes are modernizing their payment options to include PayPal financing. The Pay in 4 option allows consumers to split the cost of an item or service into four even installments. The Pay Later option can be used for more expensive purchases. Although you have to pay interest, you’ll have more time to pay it off.
Special Benefits for Funeral Expenses
You or your loved one may also qualify for benefits that reduce the cost of funeral expenses. There are benefits available through the VA, Social Security and Medicaid.
Direct Cremate is happy to discuss payment options and answer any questions you have about service fees. You can reach us by phone or text 24 hours a day.