Modern funeral costs burying most budgets

The phrase “noting in this world is certain except death and taxes” has long been attributed to Benjamin Franklin.

But Franklin likely never imagined the cost to cover a funeral in today’s economic environment. Including casket and burial, the price tag now exceeds what most Americans have stored away in savings.

The National Funeral Directors Association places the final cost to bury a loved one at $8,300, a figure roughly $300 higher than the median amount of funds most people have available in the bank, according to data from the Federal Reserve.

In fact, as many as 58% or roughly three in five of 1,000 adults surveyed recently indicated they would need to dig themselves a financial hole and take on added debt to cover funeral costs. The survey was initiated by CardRates.com.

“Having cash tucked away for a loved one’s end-of-life costs is ideal, but our poll shows many Americans may be left unprepared,” said Erica Sandberg, consumer finance expert at CardRates.com. “Shock and grief can cause you to not think clearly.”

The survey revealed a variety of methods respondents would utilize to pay for a funeral. For 34%, the first step would be to take out a loan, while 31% would look to borrow from family or friends. Another 26% revealed they would run up credit card debit, with 8% willing to sell off assets to cover funeral expenses.

Likewise, when it comes to emergency savings, not even half of all Americans had enough savings tucked away to cover three months of expenses, a study by Bankrate revealed earlier this year.

The survey also revealed funeral expenses are a multi-generational issue. When asked  if borrowing money would be the best route to cover such costs, the vast majority of those who responded “yes” were Gen Z  at 71%.  Millennials (58%), Boomers (52%) and Gen X (51%) rounded out the generational list.

Gen X survey participants (35%) were also found to be the most likely group to rely on borrowing from family or friends to provide burial assistance funds.

“Have a conversation about who can help, and in what increments,” Sandberg said. “Financial gifts are preferable, since personal loans come with emotional connections.”