I recently lost my grandma, and instead of spending time grieving her, I was caught up in logistics.
Losing someone is always a traumatising time and the added pressure of spending the days after running around to get a death certificate, organising a funeral, cancelling medication, estate planning, letting family and friends know and everything else that comes with it really does not help.
I grew up in a joint family which meant I spent the largest proportion of my life living with my parents, my sister and my grandma. This meant we became her carers, and naturally it was on us as a family to help her with all aspects of her life.
However, despite this, helping her with a funeral plan – whether that is a general end of life plan, or a pre-paid account with a funeral plan provider – really was not something we prepared ourselves for.
Now, I am sure this is a story many are familiar with – whether that is because it appears to be a taboo subject or one that no-one really wants to think about – but so few people have any form of a plan in place.
And for those that do, there is always the fear and possibility that the provider they have prepared with may go bust.
FCA takes control
In July 2022 the Financial Conduct Authority took on responsibility for regulating the pre-paid funeral plans sector, with advice in this market falling under the “advising on investments” permission.
As part of its final rules on how it will regulate advice on funeral plans, there will be a ban on commission payments and changes to appointed representative permissions.
But many advisers have mixed views on what this could mean.
Some have argued it is not an area they are involved in and do not plan to be either, while others welcome the move arguing that it does fall under long-term financial planning, just as whole-life insurance does.
Those stating they are against it have argued that a savings pot is an easier and cheaper alternative rather than a prepaid plan.
Other advisers have said that while some clients may prefer a whole-of-life policy to cover funeral costs, a specific funeral plan could prove a more cost-effective option.
Personally, I think it goes beyond just the money aspect, albeit that is a large factor.
Carrying the burden
Of course, having a pre-paid funeral plan takes the financial burden away from families, which can often be an added stress to an already emotionally enhanced situation.
But beyond that, it takes away some of the mental stress that loved ones have to go through.
I for one agree with those who are for it coming under the FCA’s remit, as the benefit of having it means people may feel as though it is more secure and they have protection.
It means those having the pre-paid plan are aware that their funds are safe, secure and protected by the Financial Services Compensation Scheme, if anything were to happen to the funeral plan provider.
The FCA’s strategy will focus on making sure funeral plans offered to consumers meet their needs while offering fair value, and that firms have sufficient resources to ensure they deliver the funerals for which consumers have paid.
Still, some advisers argue that it is a limited market and is best suited either to clients who wish to have as much control over their funeral as possible or to those who may not have suitable other provision to fund their funeral and wish to ensure their relatives are not left to pay the final bill.
I disagree.
It is inevitable that death is round the corner for everyone, so why not have a plan in place to prepare for it? Not just because they have specific requirements or because they want to fund it – but actually because it is a plan in place.
When families are about to grow with the addition of babies, many will set up a nursery in their house, buy a cot, car seat and so forth, in order to be ready for when the baby arrives.
Likewise, as someone naturally ages, why not take away some of that stress and burden from family by preparing and planning some of the afterlife logistics in a safe and secure way?
Sonia Rach is deputy news editor at FTAdviser