With the cost of living putting pressure on families nationwide, many are unaware of how lack of preparation for death can lead to severe financial consequences. Without the right steps in place, relatives could end up paying tens of thousands of pounds unnecessarily.
Rebecca Peach, founder of The Farewell Guide, is urging people to take action early and avoid these common missteps through smart funeral planning.
1. Rushed Funeral Arrangements – thousands of pounds
Funerals are one of the biggest immediate costs following a death. The average price of a basic funeral in the UK reached £4,285 in 2024, which is around £1,000 more than a decade ago. That figure is expected to rise to over £5,185 by 2029.
“When families are forced to make last-minute funeral decisions while grieving, they typically pay much more than they would with a pre-planned service,” explains Peach. “A pre-paid funeral plan allows you to pay today’s prices, not tomorrow’s. That alone could save around £900 or more.”
But the price tag can increase significantly when families are uncertain about what the deceased would have wanted. “Something as seemingly small as the design of the coffin can push costs up by £1,100,” she adds. Choosing a weekend date for the service, often without realising the extra charges involved, can also add hundreds of pounds.
Even if a formal funeral plan is not affordable, Peach encourages people to leave clear instructions for their loved ones. “Our free online tool allows people to record their funeral wishes and share them with family. It’s a powerful way to take control and reduce both financial and emotional strain.”
2. Inexistent or DIY will – thousands of pounds in legal costs
Shockingly, over half of UK adults (52%) do not have a will. This can leave their families in a legal and financial mess.
“Dying without a will triggers a process called intestacy, which is typically a third more expensive than standard probate procedures,” says Peach. “And that is assuming there are no disputes.”
Disputes, however, are common. A recent Law Society survey revealed that one in four people dealing with a will in the past five years encountered legal problems or family disagreements. These complications can quickly increase costs and cause lasting emotional stress within families.
DIY wills might appear to be a cost-saving solution, but they often fail to meet the necessary legal standards. “Wills need to be properly witnessed and worded. A mistake can render the entire document invalid,” Peach warns. “If you are going to do the right thing and write a will, make sure it is done properly.”
3. Inheritance Tax Traps – tens of thousands of pounds
Without proper planning, inheritance tax (IHT) can claim a large portion of family wealth unnecessarily.
“A £500,000 family home could result in a £40,000 tax bill if not structured correctly,” says Peach. “But with the right planning using the nil-rate band and residence nil-rate band allowances, that bill could be eliminated entirely.”
For couples, these allowances can extend to cover estates worth up to £1 million. Yet many families miss out due to lack of awareness or failure to act.
Life insurance policies are another common trap. “If a life insurance payout goes directly to the estate, it could push the estate over the IHT threshold and trigger a large tax bill,” Peach explains. “Simply putting the policy in trust could avoid this completely.”
A small investment now could save a fortune later
“Most Brits spend more time planning their summer holiday than preparing for the inevitable,” says Peach. “But your mistakes could cost them tens of thousands more than a jaunt to Majorca.”
Facing death is never easy, but ignoring it can come at a very high cost. With a bit of planning, whether that means writing a will, securing a funeral plan, or understanding inheritance tax, families can avoid unnecessary stress and preserve more of what truly matters. “Our goal is to help people plan ahead in a way that is personal, practical, and financially sound,” says Peach. “By spending just a few hours on proper planning, families can convert unexpected six-figure liabilities into manageable, predictable expenses.”