Honest Funerals

Make a Budget for the funeral

The average cost of a funeral with in-ground burial in the NYC area is $12,000.00, but it can cost as little as $4,000.00 or upwards of $30,000.00. Cremation can cost as little as $1,200.00 or upwards of $10,000.00 depending on what you include. Setting a budget and knowing what you want before you speak with a funeral director is the most important step in making sure that you do not spend more than you should or more than you can afford.

In a recent survey of funeral directors, 85% said that the number one reason for the high cost of funerals is “emotional overspending.” Following these steps can help you avoid the emotional traps that funeral directors count on to increase their profits.

How much can I afford to spend on the funeral?

Like most things in life, there is a difference between what we would like and what we can afford. It is natural to want the best of everything for your loved one, but you must consider the financial impact it will have. After watching the video, fill out each of the lines in item 2 “Budget” on the Planner. If you are filling out the form online, it will keep a running total of your Budget.

        Line 1 – How much cash I can afford?
        Line 2 – What family will contribute?
        Line 3 – Insurance and benefits?
        Line 4 – Other sources?
        Line 5 – Fundraising?

How much cash can I spend on the funeral?

The death of a loved one is one of the most emotional times that you’ll ever have in your life. Without a clear idea of what you can spend, you may find yourself in debt for a long time after your first visit to the funeral home. Most funeral directors will work within your budget – if you have one. If you do not, the sky is the limit.

Limit your contribution to the cash you have on hand. Credit cards and loans are best used only for short-term financing, until you receive insurance or other benefits. The last thing you want is to have the natural grieving process turn into panic weeks later because you can’t pay your bills.
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What will family likely contribute?

Who pays for the final arrangements is more a matter of culture and family tradition than of law. Generally all family members of the same distance of relation should be asked to contribute in the following order:

  • Spouse
  • Grown Children
  • Parents
  • Brothers & Sisters
  • Aunts & Uncles
  • Cousins
  • Friends

If anyone criticizes your arrangements or suggests that you add additional items, it is quite proper to let them know that it is outside your budget but that you would be happy to include it if they will pay the cost. This can include items such as limousines, floral arrangements, musicians, singers, vestment donations, obituaries, etc.
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Insurance and other benefits:

Life Insurance:  Life insurance policies are the most common source for funeral expenses. The primary purpose of life insurance policies is to take care of the survivor’s financial needs. Even if there is substantial life insurance, you should consider what will be necessary for the survivor’s needs before deciding how much can be used for funeral expenses.

  • CAUTION:
    • Do not discuss what insurance there is with a funeral director before finalizing the arrangements. Funeral directors may use the insurance policy as a blank check. If you are going to pay by using the insurance policy, you will likely have to sign a lien notice. The check will come in both your name and the funeral home’s name. It will get deposited in the funeral home’s escrow account and they will cut the remainder back to you. It’s not unusual that the final bill will somehow meet or exceed the insurance policy.
    • Do not automatically count on using a policy that is less than two years old to pay for a funeral. For issues such as a false statement on an insurance application, death from an undisclosed pre-existing medical condition or suicide, an insurance company can only dispute the policy within the first two years. As a result the insurance company will almost always do a review of the application and will be quick to “reserve” their rights or “disclaim” the policy if it is less than two years old. This can result in long delays and possibly having to sue.
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There may also be other sources of life insurance that you are not aware of.   These can include:

  • Life insurance benefits from a job or union.   Many unions and employers will automatically provide life insurance benefits of one to three years of an employee’s salary.   Call the Human Resource Department or union office to see if any such policies exist. You can also use this free lost policy finder to find insurance policies you may not know about.   It will take some time for your request to be completed.
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  • Life insurance policies from a business or partnership.   If the person owned or was a partner in a business, there may be insurance to buy out his/her interest in the business.   The business partners, business agreement, business’s accountant or lawyer are likely to have information about whether a policy exists.   You can also use this free lost policy finder to find insurance policies you may not know about.
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  • No-Fault car insurance. New York’s No-Fault automobile insurance provides a $2,000.00 or $4,000.00 death benefit for most people who die as a result of a car or bus accident. A good accident attorney will help you apply for your no-fault benefit and review the facts to see if you may have a lawsuit. Most will not charge to help you with your no-fault application or to evaluate the facts.
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  • Mortgage Insurance.  These policies are pretty much the same as any life insurance policy and usually can be used for any purpose, including funeral costs. In New York you can use this free lost policy finder to find insurance policies you may not know about.
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  • Credit Card Insurance.   Some credit cards offer free or optional insurance to help pay off a credit card when a person passes. Usually these policies can only be used to pay off the credit card.   Unless you are a signor on the credit card account, you are probably not personally responsible for credit card balances. Knowing about insurance covering credit card balances can help you figure your future financial needs in seeing how much you can afford to spend on the funeral.
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Employee Death Benefits:   Employers and unions, especially municipal unions such as police, fire, teachers, etc., may provide death benefits over and above any life insurance policies. These are usually in the amounts of $1,000.00 to $20,000.00.   They are typically intended to help with funeral bills but can be used for any purpose. Call the human resource or union office to see if any such benefits exist.
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Workers Compensation Death Benefits: If your loved one died as a result of a work injury or illness, you will probably be entitled to funeral expenses and survivor benefits for a spouse or children under 21 or in college. These benefits are not affected by who is at fault.   You do not always need an attorney to get these benefits. The employer should automatically provide you with the forms to get the benefits. It is still a good idea to speak with an accident attorney experienced in death cases, who can explain what you are entitled to and review the facts to see if you may have a lawsuit. Most will not charge to explain your rights or to evaluate the facts.
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Social Security Death Benefit:   A spouse or child (if there is no spouse) may be able to get a $255.00 lump sum death benefit. You can check to see if you can get survivor benefits by visiting the Social Security Survivor Benefit page.
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Veteran Death Benefit: If your loved one is/was a member of the U.S. Military and received an honorable discharge, you can request a free plot in a national cemetery for the service member and his/her spouse. This can reduce your burial costs by thousands of dollars. You will need your loved one’s DD214 form to make the request. Contact your local Veteran’s Administration or ask your funeral director to help with the arrangement. The family of service members who die from a service related injury or illness may collect or be reimbursed for up to $1,500.00 in funeral/burial expenses.   If your loved one was receiving VA benefits or died in a VA hospital, you may be reimbursed up to $300.00 for funeral services and/or $150.00 for a plot.
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Crime Victims:   Families who lose someone from a crime such as homicide may be entitled to up to $6,000.00 for funeral expenses, as well as lost wages or support up to $30,000.00, crime scene clean-up up to $2,500.00 and Good Samaritan property losses up to $5,000.00 through the New York Office of Victims Services. You can contact the OVS directly, go through an attorney who may be paid directly by the CVB or through other groups such as Safe Horizon.
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Other sources of financing a funeral:

  • Your local church or temple:
    • Catholic Charities:
    • St. Vincent DePaul Society:
    • National Philoptochos Society:
    • Hebrew Free Burial Association:
    • Plaza Jewish Community Chapel:
    • St. George’s Society of New York:
    • Children of Hope: Infant Burial Foundation.   Return to Top

    Fundraising:

    There are many reasons why a family may need contributions from their community to pay for a funeral. Unexpected, untimely deaths, such as young people, can leave a family with no other alternative.

    Taking a collection for someone can have its problems.

    • Taxes: If you receive donations and place them in your personal bank accounts, the government may question whether this is income or a gift to you or the person who eventually receives the money. Banks must report transactions of $10,000.00 or more to the IRS. This includes transactions split into multiple checks. Even if it is not deemed income, the process can be time consuming.
    • Mistrust: Nothing brings out the suspicious side of people like money. Even if it’s just gossip, accusations that someone is pocketing the donations can be hurtful and detract from the need to focus on the grieving process.

    To avoid these problems:

    1. Ask that people send their contributions directly to the person who will be paying for the funeral arrangements. This is likely to be the nearest relative.
    2. Consider asking your church to accept the contributions.
    3. Consider asking an attorney to accept the contributions and hold them in her/his escrow account. Most attorneys will be reluctant to do this, but a long time family attorney or family friend may consider it.
    4. If the contributions will be handled by family members or friends, it’s best to designate one person to receive them. This should be someone who everyone trusts.   That person should keep a list of everyone who contributed and how much.   This can help defend against any false accusations.   Customary etiquette would be to give a list of contributors to the closest relative so that the family can send a thank you note.
    5. A safe alternative is to use an online fundraiser such as YouCaring.com. This not-for-profit service charges no fee to the person setting up the account.   There are small credit-card processing fees, about 3% plus .40 cents per charge by either PayPal or WePay.   You write the story for the fundraiser which can then be viewed by the public and persons you send the link to. The best results will come from sending the link by email, Facebook and Twitter to everyone you know, and including it in an obituary if you are placing one.

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