‘Die now, pay later’: funerals are pushing grieving families into debt as the cost-of-living crisis hits

<span>Karin Adams (right) with her stepfather, organised a DIY funeral for her mother Lynn McNabb to make it more personal and affordable. </span><span>Composite: Karin Adams/Guardian</span>
Karin Adams (right) with her stepfather, organised a DIY funeral for her mother Lynn McNabb to make it more personal and affordable. Composite: Karin Adams/Guardian

Karin Adams’ mother was a lot of things – determined, creative, private. An incredible ballet teacher, a loving wife, an adoring mum.

After Lynn McNabb died in late 2022, Karin was handed a pamphlet of funeral options in Port Macquarie. But they were expensive and regimented – the kind of thing her mum would have hated.

Adams’ family had hit its financial limit – her stepfather had lost $20,000 to a scam just before Lynn passed, part of which was meant to pay for the funeral. Her three children had spent thousands flying from Melbourne and Hobart to see her before she died.

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“None of us had easy disposable income,” she says. “And the funeral money had gone to the scammers. It was terrible.”

Adams stumbled on a solution: she could run her mum’s funeral herself.

“You could design whatever you wanted. And you could also pay whatever you wanted,” she says.

With the cost-of-living crisis impacting the price of dying, grieving families are turning to crowdsourcing, buy now, pay later loans or even DIY funerals. But while some, like Adams, are finding positives over a more traditional approach, others are ending up in funeral debt.

The cost of dying

Australians pay up to $18,652 for a basic burial funeral, and up to $5,953 for a basic cremation, according to research done last year by insurance provider Australian Seniors. That’s a 20% increase from the price in 2019.

Adams says her mother’s death – including transporting the body from the hospital, the funeral and cremation – cost about $3,500.

“Our funeral must have been one of the cheapest ones they [non-profit provider Tender Funerals] had encountered, but it was beautiful. We weren’t skipping, there was a lot of attention to detail, and a lot of personal touches, which in our family matters more than how much you spend on something.”

The family decorated the venue with tablecloths and artwork from her mother’s house. They painted the cardboard box McNabb would be cremated in, and her ballet shoes rested on top. Adams took up a box of daffodils from her home in Hobart – ones she knew McNabb would have loved.

Tender Funerals also helped by offering to cover a celebrant out of the bereavement fund. Celebrants on average cost between $600 and $700, according to Willed, an online company that offers quick wills.

“If you paid for someone to organise what I organised it would have been very expensive,” Adams says.

The general manager at Tender Funerals, Nadine Giles, says they have noticed a sharp increase in people needing to use their bereavement fund to help pay for parts of their funerals.

“We have more people inquiring about affordable funerals,” Giles says. “They’ll talk about cost, or they’ll say things like, we just want something simple – because they have bill shock.”

The amount of money being accessed doubled between July last year and January this year compared with the same period the previous year.

“So that’s a huge increase, it indicates people are under a lot more pressure,” she says.

Falling through the cracks

Bereavement Assistance, a not-for-profit that helps struggling Victorians pay for funerals, says it has seen an increase in more financially comfortable families accessing their service.

Kevin Hartley from Sustainable Funerals Group, which runs Bereavement Assistance, says traditionally they have helped people below the poverty line, or those who are struggling to make their mortgage payment and have no savings.

“What we’re now getting is many, many more inquiries and calls [from people] who are fractionally above the line,” Hartley says.

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A review of GoFundMe fundraisers using the terms “rising cost of living” and “cost of living” in the Memorial Category between April 2023 and April 2024, showed listings jumped from 11 in the year to April 2023 to 42 in the following 12 months – a 282% increase.

The regional director of GoFundMe, Nicola Britton, says the cost-of-living crisis is driving Australians to think of alternative ways to fund funerals.

“Often when we look under the hood of trends on the platform, they tend to reflect a much deeper systemic issue,” she says.

“We get a clear picture of those falling through the cracks of traditional support.”

In some jurisdictions, people can access financial assistance through state programs or charities. In Queensland, a government fund covers basic costs for those who have died in the state and have no next of kin who can pay.

Data provided to Guardian Australia showed in the 2020-21 financial year, 309 applications were made and 266 approved. That jumped to 435 applications in the 2022-23 financial secure, with 382 approved.

‘Die now, pay later’

With more people struggling with funeral costs, some are finding themselves in debt.

The Australian Seniors Cost of Death Report found that out of the 424 people over 50 surveyed, about 33% experienced some financial hardship due to the costs incurred by a funeral. About 66% of those said it took months to recover financially.

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Some funeral companies offer buy now, pay later schemes. AfterPay and Zip did not respond to questions about how many people were using the service to pay for funerals, while Humm, which is offered by Queensland-based McCartney Family Funerals and Victoria-based Kingston Funerals, said the average cost was about $10,000.

“Humm is currently a financing option offered by seven funeral homes across Australia of which only four have ever transacted,” the spokesperson said. “Given the lack of demand from customers and merchants, it is not an area that we are seeking to grow.”

The CEO of Kingston Funerals, Mary Clarke, says in the past six months they have used financing for eight to 12 families.

She says their funerals can cost between $2,500 for a basic cremation and $14,000 for the whole “bells and whistles”. She says they do not push people towards buy now, pay later financing but offered it because people had asked.

“[There] was a demand for it, which is why we went ahead and provided it. Because we had in the past had families asking us, do we do a payment plan, do we have finance? No. And they’ve gone elsewhere.”

But the managing lawyer at Consumer Action Law Centre, Philippa Heir, says they are “really concerned” about buy now, pay later schemes covering the cost of funerals.

“One of the difficulties with buy now, pay later is that the providers are not obliged to assess the affordability for customers,” she says.

“That might seem appropriate when we’re just talking about small amounts of money,” she says. “But when we start looking at upwards of $5,000, this can lead to real financial hardship for people.”

Heir says more people are getting into “funeral debt”.

“The last thing you want to do with a family experiencing financial stress is for them to go out, borrow, buy, beg or steal $4,000, $5,000 or $6,000 for a funeral.

“When people are at their most vulnerable, it feels exploitative,” she says. “We should start calling it ‘die now, pay later’.”