Should we set aside money now for Mum's future funeral costs?

[Skippythebeercan]

My Dad died suddenly recently and now the funeral is over we've been working on the sadmin. But. It has occurred to me that my brother and I do need to think about what will happen when my mum dies. I'm desperately hoping we have decades but even so I have wondered about a few things. One thing that is bothering me is paying for the funeral. My mum had access to plenty of money when my Dad died so it was relatively stress free as there was no issue over cost. But my brother and I don't have access to £10,000 ourselves and would need to pay from the estate (and there will be money there). Is it worth asking my mum to give my sibling and I £5k each to hold for the funeral? (My sibling is totally trustworthy and we would both keep it safe). Given how useless the banks have been I can't see us easily being able to access the money from the estate and I want things to be as worry free as possible.

My nan prepaid for her funeral with the local funeral directors
That could be an option

Banks will do a one off payment to a funeral home from a deceased estate or she can buy a funeral plan like this one www.coop.co.uk/funeralcare/funeral-plans.

Banks will release money to pay for the funeral. When my father died we had to submit the funeral costs to his bank and they paid the invoice iirc. Some banks were easier to deal with than others, I remember Santander was particularly awkward and RBS was very easy.

I've just organised pre-paid plans for two elderly friends, who were concerned about their funerals. We just went to their chosen funeral director and talked through what was wanted, and the overall thing is administered by an insurance organisation so the money is safe.

Edit: fat fingers!

I think most undertakers understand that you need to wait for the estate to be dealt with before the bill is paid. I paid for my DF's funeral myself - he and DM had no planning or savings. But DM had a policy which she assumed would cover her funeral. We chose a direct cremation because that is what she would have wanted but that had to be paid straight away so we paid for that. When we claimed from her policy it was only about £ 1K, not enough for the direct cremation and certainly nowhere near what would have been needed for a traditional service.

My late MIL had a prepaid plan and it was really easy to use. It’s also a good hedge against rising costs, so if your DM has enough cash to pay for one, it’s worth suggesting she considers it.

If she resists, then as PP have said, funerals can be invoiced against the estate and banks will usually pay direct. Bear in mind though, that anything other than the costs that go through the funeral directors and crematorium will not usually count. You may have to pay for flowers and wake yourself and claim from the estate.

Funeral directors are usually prepared to wait for funds from the estate ime.

Some banks will be helpful and allow settlement of a funeral invoice from funds before probate.

I wouldn't get into asking your mum for funds to pay for a funeral. There are ways round it if you don't have the money yourselves.

The easiest solution is for her to buy a pre paid funeral plan, leaving grieving relatives to sort out a funeral can be very upsetting. I wouldn't spend 10k on a funeral and banks release the funds. I would encourage her to make a will and a funeral plan.

I think that would be very sensible to plan ahead. If there is money in her bank account when she dies they can authorise a payment direct to the funeral director (for the funeral itself but not the wake) before probate.

But that is only useful if there is enough money. Two of husbands siblings have died owning a house but hardly anything in the bank. In both cases family members had to cough up for the funeral and then wait for probate/house sale to be repaid. If family members dont have the funds they can pay in instalments. If next of kin is on a very low income then you can apply for a funeral grant but it's very basic, covers direct cremation sort of thing. Or (last resort) if no one can or will pay/apply for a grant the local authority will eventually pay for a direct cremation but they aren't keen to offer this and so it can be several months wait.

A funeral plan is a really good idea. If you don't want to mention to your mum I think you and your brother could arrange it direct.

Nearly every bank offers the ability to pay funeral expense direct from bank account so I wouldn’t bother tbh.

If your mother dies within 7 years you might have to pay inheritance tax of 40% on that 10k. If you leave it in the estate it isn’t taxed. This is only applicable for larger estates.

Better to get her to open an account specifically for this purpose.

As others have said I have heard mixed things about funeral plans.

My Father had a Co Op plan and they are the biggest funeral directors in the UK.

It was very easy to administer and as others say banks will pay a funeral directors bill. £10k is very expensive for a funeral btw.

The funeral director guided us and realistically they do need to be paid. They cannot be expected to wait until after probate which could take months/years.

ALL banks are able (and required by law) to pay funeral costs (and IHT fees if memory serves) from a deceased estate, its one of the few transactions that ARE allowed. Must be made payable to the undertaker so I suppose there would be additional costs for the funeral tea.

Might be worth getting a joint account with the funds in so that you can access as sole account holder after death.

My husbands mum died 4 years ago. He gave the funeral invoice to the bank who paid it out of her bank account

You still only pay iht on the large estates. If the estate isn't over the IHT threshold then iht isn't due no matter where the money is. If the estate is over the IHT threshold then the estate will pay the inheritance tax.

Buy a plan. If they end up self funding care her assets will be run down to about 32K.

If you pre-pay a funeral plan the 32K will be left to cover any ther outstanding liabilities/ bequests, if you don't it will be much less as the 32K will have to cover the funeral costs.

This possibly sounds money grabbling but most older people want to leave money they have worked hard for as a legacy.

Funerals don't have to be expensive, my mum had a direct cremation, it was £2600 with a local independent undertaker, my dad's with a full service was only £3600. Rather than prepaying would it be possible to start a bank account in your name to build up the money to pay for a funeral, having it in your name makes it easier if her bank accounts get frozen.

I’ve had to arrange a few funerals recently. I’ve never got close to 10k, not even 5k for any of them !

2 options - prepaid funeral plan that she can sort out now or when the time comes send the funeral invoices to her bank and they will automatically pay them directly.
Unless she has no money of her own, there is no need for family to be paying funeral costs out of their own money.

My Mum had a joint account with me. She put the money in, I was the other signatory to cover costs after her death.
She then spoke to the local funeral director (friend of my fathers) and took out a funeral plan. I really didn't want to know all the details, but she'd had a hospital stay and ended up in Intensive care and I'd been told to prepare for the worst.
I'd suddenly had the realisation that I had no clue what her wishes were and I'd have been on my own making decisions and the person who'd have known the answers would be gone. So she took out the funeral plan, and made the decisions and left the instructions and it was the kindest thing you could ever do for your children.
The joint account paid for my sister and her family to fly home from USA and lots of other incidental things. The funeral plan sorted everything to do with the funeral and burial.
When my sister arrived home I went into the bank and withdrew half of the joint account money and gave it to her.

It’s not £32k, it’s £24k.

@Soontobe60 Depends on where you are in the UK

in the LA area for my old person it’s 32k

The bank should pay the funeral directors invoice. Barclays were really helpful when my dad died and paid it by bank transfer there and Ben when we went in with the invoice.

But I agree it’s worth having the money set aside. One of my friends died a few years ago and for one reason and another she had no savings (she did have a house mortgage free but no cash at the bank). Her son had to take out a loan to pay for the funeral and I paid for the wake. It made me think that I need to keep £5-10k separate somewhere and accessible as I wouldn’t want DS to be put through that headache on my account. I know a friend of mine is considering the same and thinking of buying a funeral plan with a local undertaker.

I’m a probate lawyer. You don’t need to set money aside. When the time comes just take a copy of the funeral invoice and a death certificate to your mother’s bank and they will pay the funeral directors directly.
the only plus of a prepaid funeral is you get the funeral at todays prices however, the £ would be better invested imo (I generally think funeral plans are a con) for the above reason.