There’s lots to think about – and to pay for – when considering the cost of dying

When we talk about saving for retirement, we tend to talk about things like covering our expenses after we’ve stopped working – housing costs, food, transportation, travel, maybe healthcare later in life.

But there’s another expense – the cost of dying – that’s out there, and while we won’t be around to pay the bill, it should be factored into our planning, experts say.

Writing in The Toronto Star, Andy Takagi notes that “as Canadians struggle with the cost of living, the cost of dying has quietly catapulted, becoming increasingly unaffordable for low-income Canadians.”

“The average cost of a burial in Canada can range from $5,000 to $10,000, according to Sun Life, and even cheaper alternatives like cremation can still average between $2,000 and $5,000,” he writes. In Toronto, one of the most expensive cities in the country, the cost of a single burial plot with an upright marker at the Mount Pleasant Cemetery runs “between $27,760,50 and $34,825.”

Why are costs going up?

According to Jeff Weafer of the Funeral Services Association of Canada, “staff costs, facility costs, and the costs of goods needed for ceremonies have increased, just like everything else, with inflation,” the Star reports.

He and his association would like to see the federal benefit – which has been set at a flat rate of $2,500 since 2019 – increased. Prior to 1998 the death benefit was higher, around $3,580, the article notes.

The CBC says the rising cost of burials has prompted many to opt for cremation rather than traditional full-body burial.

“Over the past two decades, cremation has become the norm in Canada,” the broadcaster reports.

“According to the Cremation Association of North America, which uses data from provincial vital statistics departments, the cremation rate in Canada has risen from 48 per cent in 2000 to 72 per cent in 2018. And the association expects the rate will keep increasing over the next few years,” the CBC adds.

As an example, at St. Michael’s Cemetery in Edmonton, Alta., an area for cremation plots was opened in the 1980s. While rarely used in those days, today they are in high demand, the CBC notes.

The broadcaster reports that a cremation costs between $2,000 and $5,000, significantly lower than a burial, which was going for $5,000 to $10,000 at the time the article was written in 2020.

At the LowestRates blog, the authors suggest that the cost of dying needs to be talked about in the here and now.

“The topic is taboo to most, but talking about it is important. If we don’t, how will we prepare for a loved one’s passing? Or our own? Because we should prepare when possible. We should know what arrangements have to be made and what those arrangements will cost. Better to deal with funeral expenses and the decisions that come with death sooner rather than later, right,” asks the blog.

As with any purchase, the blog continues, there are lots of costs to consider and lots of options. It’s not unlike buying a car, the blog adds. Things to factor in include getting a death certificate, transfer services, a shroud, casket or urn, body preparation, formal ceremony costs, burial plots or niches, and the cost of burial or cremation services.

And of course, who pays?

“Either you, your insurance company, or those who survive you, like your spouse/partner, children, or parents, will be responsible for covering your funeral expenses in Canada,” the blog explains.

“If you plan with a life insurance policy, the death benefit paid out by your insurance provider can help cover your funeral and after-death costs. Just pay your premium now, and you can spare your family the stress of handling those funeral bills later,” the blog continues.

The other option, the blog adds, is to “plan and pay for your after-death arrangements in advance of your death. So, right now.”

Unfortunately, this writer is at the age when many family members have been passing away. Some pre-paid, others paid via their estates. In all cases, the funeral home was very supportive. We can also add that there is a raft of other things you need to do when a family member passes, including cancelling their Canada Pension Plan/Old Age Security payments, their provincial health card, applying for a death certificate, and more. The folks at the home guided us through that complex maze; an accountant and our lawyer helped us with the intricacies of being an executor for an estate.

So for sure, the experts are right – you need to have this unwelcome conversation at some point while you can.

The Saskatchewan Pension Plan is open to all Canadians who have registered retirement savings plan (RRSP) room. You can make contributions up to your limit, and can also transfer in cash from other RRSPs in any amount. That way your retirement savings can grow in a consolidated, low-cost, professionally run pooled fund. At retirement, you can receive an annuity payment on the first of every month for as long as you live, or look at the more flexible Variable Benefit option.

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