Is it About Honoring the Life…or Paying the Bill?

paying for the funeralThe subject matter of finances continues as I converse with funeral directors across the country.  As most have shared with me,  pre-need sales are stagnant or “not what they used to be.” With the shaky economy and consumers paying close attention to expendable dollars in their household budget, this should not be a big surprise.

Additionally, consumers arriving at funeral homes with life insurance are decreasing as well.  As reported by the Life Insurance Marketing Research Association; “the proportion of U.S. adults with life insurance protection has declined to an all-time low with 41% (95 million) of all adults have no life insurance at all.”

So if a consumer did not pre-pay/plan their funeral goods and services with a contract, the surviving family members that remain behind are making decisions for funeral goods and services with lingering thoughts:

  • If the deceased had valid life insurance, is the amount enough to pay for the goods and services that we desire?
  • If the insurance is not enough, should we pay the balance out-of-pocket or just spend only the amount of the policy?
  • If the deceased had valid life insurance, how much should we spend on funeral goods and services?
  • If the deceased had valid life insurance, should we use some of that money for other bills (medical, survivor needs, etc.)?

Of course, the above questions arise only in the cases that life insurance exists.  So with no pre-paid contract and no life insurance, what thoughts exist?

  • How much are the funeral goods and services going to cost?
  • We have savings, but should we dip into those funds?
  • Do we have enough credit card balance to charge the funeral goods and services?
  • What can we get for the amount we have…or willing to spend?

A funeral director must tailor the funeral goods and services to the budget that a family desires to spend.  And this is where the quandary begins with two sometimes opposing forces at work:

  • Satisfying the family’s desires for honoring their loved one within their budget.
  • Collecting funds for goods and services rendered that provide profitability for the funeral home.

Just like any other business, funeral home owners are being forced closely scrutinize their operating expenses and make decisions for financial sustainability.  A thorough evaluation of fixed costs, personnel management and cost of goods should be conducted.  Upon gaining a firm grasp of expenses, projections of revenue is essential.  As with most firms, the revenue projection process is like nailing Jell-O to the wall.

What is abundantly clear to most funeral home owners is that many consumers are making significant changes how they choose to provide final rites for their deceased loved ones.  “Traditional” burial is decreasing and cremation is increasing…no surprise there.  However; competition of getting the attention of consumers for how they can better budget their “funeral dollars” is rampant…within our industry along with outside of the funeral industry influences.

What does a firm offer for the growing demographic of funeral consumer that has little to no life insurance or limited funds for goods and services?  What strategies and training are in place to increase revenue along with cash flow from these consumers that meet the financial needs of the funeral home?  What are the messages and how are they sent to attract this growing market segment?  Are these conversations even taking place…or is the firm ignoring what the marketplace is telling them?  Times and consumers are changing.  The good old days are long past the funeral industry.

  1. Morguie said:

    Yes it is a stern reminder that this “improving” economy (yeah right) is still leaving many in a tight spot when a death occurs. I fully believe there are a good number of firms ‘ignoring’ this who are indeed shutting out a growing market’s need for service on fewer dollars. Business plans must adapt to the times if they are to hope for survival in these leaner times. I personally doubt many will change until it’s forced. Wake up and smell the coffee, people! As with most things, the economy tends to correct and the cycle of boom may return—when it eventually does, it will be too late for the ignorant ones to recoup the families they lost in lean times. I shall stay tuned to watch it unfold. It should be interesting.


  2. Can someone explain the Cadillac vs Toyota analogy using one funeral vs another funeral? Can someone also explain “You get what you pay for” thanks I find this very interesting

    Liked by 1 person

  3. Jeff Harbeson said:


    Often in the funeral industry we hear “you get what you pay for” regarding services or products by funeral homes. If you pay for a basic cremation, what are you getting? Some funeral homes tout “excellent service” however with no comparable points of difference of the competing firm. Please share with me your perspective and industry that you work. Cheers, Jeff


  4. Morguie said:

    If I might weigh in here (I saw that Dave asked this through my own blog). The analogy of the cars — the difference in the more expensive model is that there is a level of service provided, such as the extras a car dealer might offer, say, an extra maintenance and roadside assistance package, warranty, or a detailing once per year, all of which are included in the price of the vehicle.
    That is not to mean that you don’t get good service is you go to a cremation service facility and purchase the basic items, such as you outlined above. One would hope that you are treated well and encouraged to contact the proprietor if you had any other concerns, etc. However, a basic cremation (sometimes called affordable or “cheap” cremation —I hate that word!) is JUST that. No facilities are provided for a gathering or a service, no services beyond the ones you purchase as listed on your contract.
    Basically, the place takes care of the body and the necessary paperwork and transport. The rest of any other ideas you think of regarding holding a Celebration of Life service or a viewing, etc. are ON YOU, a sort of do-it-yourself deal.
    The alternative, more detailed and more expensive service is provided, and alleviates the stress and expertise you would have to put into making these things come together in a meaningful and seamless manner.
    Funeral homes are staffed by licensed and experienced professionals. That is their forte and what they do best.


  5. Thanks, That was very interesting


  6. I just manage a warehouse that deliveries the merchandise. I would love to share my perspective, but not publicly


  7. Once we open the highest cowl we find a brief paragraph of textual content from Turtle Seaside telling us concerning the


  8. Very good post. I’m experiencing some of these issues
    as well..


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