Financial Strain of Funeral Costs in America
Funerals are, unfortunately, one of those unavoidable expenses we all face. A recent survey reveals that more than half of Americans acknowledge they would need to borrow money for a burial.
Specifically, about 58% of American adults expressed they’d have to take out loans or use credit cards to cover funeral expenses, as reported by a survey released recently. This kind of statistic is pretty startling—it indicates that a significant portion of the population could be caught off-guard by the costs involved.
“That’s quite a substantial figure,” said Erika Sandberg, a consumer finance expert. “Almost 60 percent of people might find themselves unprepared for such an expense.” She went on to highlight the difficult financial situation many faces today.
Among those who can’t afford a funeral, the survey indicates that 34% would consider taking out a loan, while 31% might rely on family or friends, and 26% would opt for credit card debt. A smaller percentage, about 8%, mentioned they might sell some assets to cover the costs.
Interestingly, the National Funeral Directors Association reports that the average funeral—including casket and burial services—comes to roughly $8,300. Yet, it’s worth noting that the median American bank account balance is only about $8,000, according to the Federal Reserve.
“This creates a real challenge in our economy,” Sandberg noted. “More people are struggling to manage their everyday expenses, and that makes it even tougher to save for things that, well, are inevitable.” With inflation reaching new heights since mid-2024 and declining consumer confidence attributed to rising energy prices tied to global events, the situation is indeed precarious.
Further complicating matters, the International Monetary Fund recently warned that escalating tensions in the Middle East could further hinder economic growth, increase inflation, and possibly even lead the country towards recession.
Sandberg pointed out that many cash-strapped consumers are primarily focused on immediate needs—like school and medical bills—while putting off planning for funerals until it’s too late.
A survey from earlier this year indicated that less than half of U.S. adults have enough savings set aside to cover even three months of living expenses. This study was conducted before significant disruptions in energy supply arose from geopolitical tensions in the region.
In terms of financing funeral costs, Sandberg recommends borrowing from friends or family as one of the best options, since these kinds of loans usually don’t come with interest charges.
If credit cards are the route you choose, it’s crucial to pick one with a high credit limit and devise a repayment plan that allows for a reasonable approach to managing the debt. Loans tend to offer lower interest rates compared to credit cards, but she suggests keeping the payback period fairly short to avoid accumulating too much debt.
“It’s incredibly tough to navigate such decisions when you’re dealing with emotional distress,” Sandberg added. “You might not be in the best frame of mind to make wise choices, so talking to someone you trust can really help in figuring out the best path forward.”
