Families Left With Average Bill of $12,702 When a Loved One Dies

Families Left With Average Bill of $12,702 When a Loved One Dies

Advanced planning could help reduce the financial and emotional toll felt by loved ones after a loss
widow at funeral home

About 3 million people die every year in the U.S. and there are countless families who suffered the loss of a loved one due to COVID-19. In addition to their grief, many of those who experienced a loss also shoulder a financial burden they were not prepared to bear.

In its first annual Cost of Dying Report, Empathy, a platform that helps families deal with loss, looked at the total cost involved with laying a loved one to rest, including everything from funeral expenses to hiring legal professionals. In their survey of over 2,000 people in the U.S., Empathy found that many individuals suffer a long-lasting toll that impacts everything from their retirement savings to their work performance.

Funeral costs put many families in debt

In their survey, Empathy focused on people who've lost a loved one in the last five years. Among that group, respondents reported paying an average of $12,702 for the total arrangements and services involved. Here's how some the average costs break down, including services that some families in the survey did not utilize:

  • $7,267 funeral cost
  • $3,910 lawyer fees
  • $4,461 real estate professional
  • $2,456 accountant
  • $1,637 therapist or social workers

In the survey, only 1 in 7 families say that the costs associated with their loss was paid for in advance, or that they were able to cover the costs using inherited funds, and more than 50% report that they had to deal with debt. That means the vast majority are left to pay through their own means.

How do families cover these expenses? In a recent survey from LendingClub, the majority of U.S. adults reported living paycheck to paycheck, and many report having less than $400 saved for an emergency. Respondents in the Empathy study were most likely to cover the costs with credit cards (43%) and some drew from their savings or investments (37%).

Families also bear emotional costs

Empathy also looked at non-monetary expenses absorbed by surviving loved ones. Families in the survey report committing additional time and energy for an average of 13 months after their loved one passed. Here's how they were impacted:

  • 46% spent more than 26 hours per month on the phone
  • 52% said their work performance was harmed
  • 57% experienced clinical physical or psychological symptoms of stress
  • 17.5% of all respondents had panic attacks, and that number rose to 29% for people under age 45

Is there a way to reduce the cost?

One of the best ways to reduce the financial and emotional strain of a loved one's death is to make preparations in advance. While the majority of adults say they're uncomfortable discussing money with their partner or family, having difficult discussions about financial arrangements and end-of-life plans is crucial to reducing the difficulties that can surround a loss. Here are some of the ways you can prepare:

  • Gather important records such as financial statements, lists of assets and contact information for family members. Make sure a loved one knows where to find these documents.
  • Prepare legal documents, including an advance directive, living will and/or power of attorney.
  • Make funeral plans, which could include shopping for and prepaying for products and services.
  • Purchase the appropriate life insurance policy and be sure to keep your policy updated.
  • Gather account login information, including social media accounts, and make a plan for when and how you'll give access to the appropriate person.
  • Check your employee benefits, which could include funeral planning or survival counseling services.

Methodology: This study’s findings are based on Empathy's survey of 2,138 qualified respondents. The target group was family members who lost a loved one in the last five years and took part in managing their loved one’s affairs.