Savings, or investments, versus funeral costs | Dignity Funeral Plans
Skip to content

Will your savings or investments be enough to cover the cost of a funeral in the future?

Making provision for your funeral costs in advance through savings in the bank, investments or an ISA is, in general, a good idea. But low interest rates mean that even the best savings accounts won’t keep pace with the rising costs of funerals.

A Dignity Prepaid Funeral Plan can give you the peace of mind that comes with knowing your funeral costs and arrangements in your Plan are guaranteed to be covered, regardless of how much funerals may cost in the future.

With the average cost of a funeral at £4,086 today[1], you can see below that if you put this same amount into savings or an investment plan, even the best performing accounts will not meet the full expense of a funeral in the years to come.

Stack of coins
The average cost of a funeral today is £3,737[1], but if you invested that money another way, would you have enough to cover the cost of a funeral in the future?
In 2024, funerals are expected to cost
If you put the money in a Current Account, in 2024 it could increase to
6,106 short
If you invest in a Cash ISA, in 2024 it could increase to
6,106 short
If you invest in Stocks and Shares, in 2024 it could increase to
6,106 short

By relying on savings or investments to pay for funeral costs you’re likely to be left with a shortfall, but there is a way to protect against rising costs and save money.

How to protect against rising funeral costs

How do the best savings accounts measure up when saving to pay for your funeral?

Savings accounts for the over 50s offer lower interest rates than most current accounts. The best returns on savings do not exceed 1.5%. What’s more, the best instant access savings accounts for the over 50s fare even worse, offering less than 1% interest.[2]

Although current accounts give better returns, even the best returns on savings for someone looking to make provision for a funeral are lower than the projected rise in funeral costs.

Granted, saving is always a good idea, but it isn’t necessarily the best way to pay for a funeral. As you don’t know how much your funeral will cost or when it will be, you don’t know how much you’ll need to save to pay for it.

When you take out a Prepaid Funeral Plan with Dignity, you won’t have to worry about low interest rates, as you’re paying for your funeral in advance, freezing the cost of the funeral services in the plan at today’s prices.

What about investments?

Investing in the stock market is a great way to make money – but only if you can afford to do it for the long term. You could make a quick profit, but it’s statistically unlikely.

Even if you have a long investment horizon – which effectively means being aged under 50 – you are highly unlikely to make more than the average returns of an index like the FTSE 100, FTSE 250 or FTSE All Share. In the 20 years to 2014, the FTSE 100 rose at a rate of 5.4% - but that is before inflation, tax and fees, which will considerably reduce the return an investor actually receives.[3]

Like savings accounts, a balanced investment portfolio is definitely a good thing and can provide valuable income in retirement. But you can save money on funeral costs by taking care of funeral costs in advance with a Prepaid Funeral Plan from Dignity, which means more to leave behind for loved ones.


  1. Today’s average funeral cost: Matter Communications 2016
  2. Best savings rates: General savings - accounts for older savers (January 4, 2016)
  3. Morningstar: iShares FTSE 250 (GBP) | MIDD (December, 2015)


Tool Calculations


Why Choose Dignity?

Dignity is the UK’s leading provider of prearranged funerals. Since we introduced the first funeral plan into the UK in 1985, more than 740,000 people have made provision for their funeral costs in advance with Dignity.

Read more

Compare Dignity's Prepaid Funeral Plans

Compare Dignity’s Defaqto rated Prepaid Funeral Plans. All our Plans guarantee the Funeral Director services for a cremation or burial funeral.

Read more