Question

Select a funeral home in your area and obtain permission from the director to interview an employee about the costs, concerns, and arrangements that have to be made when making funeral arrangements in advance of a person's death. (Most directors will be willing to give you copy of their typical itemized cost sheet.) Make an appointment with that person, being sure to let him or her know that this is research for a paper rather than an actual pre-arrangement. Here are some questions you might want to consider:

• What is the cost of the average funeral at this time?
• What is your best prediction for the cost of a funeral five years from now? Ten years from now?
• Are there any costs that cannot be paid in advance?
• What happens to the money you pay in advance? How is it stored, used, etc.?
• What does "irrevocable trust" mean?
• What advantages or disadvantages are inherent in advanced payment?
• Should turn in a detailed summary of your questions and the answers to those questions, as well as your conclusions about the wisdom and/or difficulties of making arrangements in advance.

This does in fact have all of the needed information to complete this question. Thanks

Answer 1

a)

The average funeral costs between $7,000 and $12,000. This includes viewing and burial, basic service fees, transporting remains to a funeral home, a casket, embalming, and other preparation. The average cost of a funeral with cremation is $6,000 to $7,000. These costs do not include a cemetery, monument, marker, or other things like flowers.

Funeral costs have been rising steadily since the 1980’s. Today, it’s not uncommon for the average funeral to cost up to $9,000 or more depending on whether the body is buried or cremated. Caskets and urns can cost thousands of dollars alone depending on the style and material used.

b)

In no particular order, here is what I’m predicting the funeral profession will look like in 5 years:

• Cremation Rate: The national cremation rate will hit 57%. No surprise there but I don’t see this trend changing until the industry starts addressing some of the underlying issues brought on by the shift in demographics and pricing strategies. And this requires change, something we have not been very good at. But we’ll dig into this in more detail in a later blog post.

• Online Funeral Arrangements: 25% of all funeral arrangements will occur online and many funeral professionals will discover that this scary proposition delivers more education and value more easily than when dealing with an actual human at the funeral home. There is a belief out there that quality funeral service requires human contact. This will be challenged and new learning will occur.

• New Business Model: A new business model will emerge that turns the conventional wisdom of funeral service on its head. It will attack the four major costs of the industry—people, facilities, advertising and cost of goods—and dispel the common thinking that these things “are what they are”, and there is nothing we can do about them.

• Publicly Owned Companies: There will be two less publicly owned companies. Time will push people into a corner and grow we must!

• New Major Player: There will be a brand new major player in the industry, possibly not related to the funeral profession, that will approach the challenges of funeral service from a different perspective. I know, I know this has been predicted or feared for some time but I believe their less conventional way of doing things will appeal to the critical mass of Baby Boomer decision makers, creating larger and more attractive opportunities.

• Cost Sensitivity: 70% of the industry will head down the cost sensitive path. I am not sure if we will hit rock bottom but there will still be a large opportunity for firms who believe in supporting the emotional needs of those touched by death.

(c)

Following Costs cannot be paid in advance:

i) Embalming Costs

ii) Cremation Costs

iii) Professional Services

(d)

(e)

Irrevocable Trust:

An irrevocable trust is one that generally cannot be amended, modified, or revoked once it is created. The written terms of the trust agreemen the trust's formation documents are set in stone, with only rare exceptions.

(d)

Advantages & Disadvantages of Pre payment:

PROS	CONS
You can gain peace of mind by taking care of the details of your funeral so your loved ones won’t have to after you’re gone.	The funeral home could go out of business, and that could leave your loved ones with the costs despite your efforts. Check with your funeral home to see what their process is.
You can arrange the type of funeral you want and choose the cemetery plot you want to lie in.	Most pre-paid funeral plans don’t transfer – if you have a contract with one funeral home and die in another location or want to move, the funeral home often won’t transfer your plan to the new funeral home.
With a guaranteed plan, you can lock in today’s prices – even if prices go up.	You may not get a refund if you change your mind about the plan or decide to pay for your final expenses differently.
Some people have a funeral home they’re adamant about using. Purchasing a pre-paid funeral home with said funeral home ensures their final wishes will be honored.	Pre-paying your funeral expenses doesn’t leave any money for your family to pay for other end-of-life expenses you’ll incur, such as medical expenses.

e)

Average Funeral Costs:

Item	Cost
Funeral home’s basic service fee (nondeclinable)	$2,100
Transporting remains to funeral home	$325
Embalming	$725
Preparing the body in other ways, such as makeup and hair styling	$250
Facilities and staff to manage a viewing	$425
Facilities and staff to manage a funeral ceremony	$500
Hearse	$325
Service Car	$150
Basic memorial printed package	$160
Metal casket	$2,400
Median cost of funeral with viewing and burial	$7,360
Vault	$1,395
Cost with Vault	$8,755