Why the cost of dying is soaring in Victoria

Rising funeral costs and the Allan government’s looming “death tax” are prompting more Victorians to pre-pay for their own funerals to help ease the financial burden on loved ones.

Struggling with grief and now saddled with the possibility of the state government’s new “death tax”, Victorians are forking out more than ever to finalise affairs and lay their loved ones to rest.

It has resulted in parents pre-paying for their own funerals, in an attempt to ease their children’s financial pain at a time when they are most vulnerable.

New data shows one in four Victorians experience financial distress as a direct result of arranging a loved one’s funeral, which is set to worsen as the Allan government considers the new tax which would see probate fees skyrocket by 650 per cent.

The average price of funerals has increased every year in Victoria for a decade.

Melbourne social worker Veronica Greenfield, 68, overpaid $15,000 for her parents’ funerals, and like many experiencing grief, was too upset to ask about costs upfront.

The mum-of-five from Eltham has already pre-paid for her own funeral arrangements, to spare her children the financial distress.

“At the time, because (my parents) hadn’t arranged anything prior, I just cobbled together money and did what I thought I was supposed to do, instead of having a conversation with them about what they wanted before they died,” she said.

“My kids are raising their families, I’m horrified to think they’d spend thousands of dollars, when that could be enough to help them with a deposit on a house.”

Ms Greenfield overpaid $15,000 for her parents’ funerals, and like many experiencing grief, was too upset to ask about costs upfront.

The Australian Funeral Industry State of the Nation report found two in three people don’t ask for a funeral quote with many too emotional to ask – leaving bill shock on the other end.

More than 30 per cent assumed a coffin was a legal or religious requirement, despite only 42 per cent thinking it was important. On average a casket accounts for a third of total funeral costs.

It comes as new data from Affordable Urns also revealed Melbourne was the second most expensive city for funerals in Australia.

In Melbourne, it costs on average of $8,262 for a basic cremation service and $7,451 for a basic burial service. This falls just behind Perth on $8,813 for a cremation and $7,813 for a burial.

Sydney comes in behind Melbourne, costing $400 cheaper per funeral service. The cheapest city is Darwin, costing $6,440 for a cremation and $4,787 for a burial.

The biggest factors contributing to cost differences include service provider rates, facility costs and local regulations.

Co-founder of funeral provider Bare, Sam McConkey, said a growing number of Victorians are opting for more affordable funeral options including unattended cremations and a DIY memorial.

Mr McConkey said the average price of funerals has increased every year for a decade.

“One of the main reasons (people don’t ask for a quote) is that we often view death as an emergency and feel the need to rush into a decision or an action,” he said.

“That often means people accept the first quote they get, in order to feel like they’re ‘doing something’.

“While often tragic, death is not an emergency. Families can and should take their time, consider their options and make a considered decision on the best goodbye for them.

“The industry needs to step up its focus on educating consumers about their options when it comes to deathcare, so families can make the decisions which are right for their situation and avoid unnecessary or unexpected costs at their most vulnerable.”

Mr McConkey said it was important families have conversations about what type of funeral they would like, while they’re still living, to reduce stress and the chance of paying for unnecessary services.

“Death is still a very taboo subject, it’s not really something we talk about, but we should. It’s a certainty,” he said.

He said he was “strongly opposed” to the proposed probate fee reform in Victoria.

“The direct impact will place more distress on grieving families – at a time when financial pressures shouldn’t be taking centre stage,” he said.

“The indirect consequences will also be significant. We expect the downstream impact to be that will makers will look to restructure their affairs in order to minimise the impact, and we may even see more executors refusing to take on the role.

“In both cases, this will create even more complexity for courts to manage – at an even higher cost. This is the antithesis of what the government is trying to achieve.”

A state government spokesperson said Victorian probate fees are lower than in other states.

“They don’t cover the costs of hearings in the Supreme Court adequately and any change would still see average fees lower than the fees charged in New South Wales or South Australia,” they said.

“The preferred option would also make it cheaper for many people – especially when the proceeds from an estate are less than $500,000.”