How Building an Emergency Fund Can Help You Prepare for Funeral Expenses

An emergency fund acts as a financial buffer against unexpected costs, protecting you from going into debt when unforeseen expenses arise. Whether it's medical emergencies, car repairs, or sudden job loss, an emergency fund provides a safety net. Funeral expenses often come unplanned and can be a substantial financial strain. This is where an emergency fund becomes invaluable.

According to personal finance guru Eugene Chai, an emergency fund should ideally cover three to six months' worth of living expenses​​. This fund ensures that you can manage large, sudden expenses without jeopardizing your financial stability. By including funeral costs in your emergency planning, you not only safeguard your financial health but also provide peace of mind to your family.

‍

Funeral costs can vary widely based on the type of service, location, and specific cultural or religious requirements. In Singapore, for instance, the cost of a traditional 3-day funeral averages at SGD 8,232. Find out more about the average cost of funerals in each of our directories.

Given the substantial amount required, it's crucial to allocate a portion of your emergency fund specifically for these expenses. This proactive approach ensures that funeral costs are covered without compromising you and your family’s financial well-being.

Find out more about the breakdown of funeral costs in our article here.

Creating an emergency fund may seem daunting, but can be achieved effectively with some effort and changes in lifestyle.

Here are some strategies to get started according to an article by Eugene Chai:

Automate Your Savings

Set up automatic transfers from your checking account to your emergency fund. This ensures consistent savings without needing constant attention.

Cut Unnecessary Expenses

Identify and eliminate non-essential expenses. For example, cancel unused subscriptions or reduce dining out. Redirect these savings to your emergency fund.

Increase Your Income

Consider taking on side jobs or freelance work. The additional income can significantly accelerate the growth of your emergency fund.

Set Realistic Goals

Start with a manageable savings target, such as one month's worth of expenses, and gradually increase it. Celebrate milestones to stay motivated.

In addition to building an emergency fund, it’s essential to understand how to manage and potentially reduce funeral costs:

Compare Funeral Homes

Research and compare different funeral homes in Singapore to find one that offers the services you need at a reasonable price. Use our funeral directory to compare, filter and sort funeral packages, identifying the one you need with ease.

Plan in Advance

Pre-planning your funeral can lock in current prices and relieve your family from making stressful decisions under pressure.

Seek Financial Assistance

In Singapore, certain financial assistance programs may be available to help cover funeral costs. Assistance is available and provided by certain organisations for those in need.

‍

Unfortunately, according to a report by the Competition Authority, there have been complaints of some funeral service providers partaking in unfair practices. For example, some consumers complained that the final price they paid was a lot higher than the price informally agreed upon first calling the funeral directors.

Here are a few precautionary measures one can take to safeguard against such predatory practices:

Familiarise yourself with funeral costs

Using our funeral directory to filter for your needs will give you a good impression of what market prices are, and not fall for expensive inclusions that you do not need.

Hidden Costs

‍Familiarise yourself with what a funeral cost entails and identify what you need and what you do not (eg. Catering, premium casket, premium hearse etc - covered in our funeral cost breakdown). Let the funeral director know what you need and do not, and clarify if there are other hidden costs.

Lock in the price and identify key decision makers

When communicating with the funeral director, lock in the price and make it known that you don’t want to pay any more than the initial cost. Let them know who the key decision makers are in the family, and only allow additions to the funeral cost with their consent.  

Look at Review Scores:

‍Use our directory to sort based on Google or Facebook review scores, and if you have the time, read through the reviews to get an impression of the attitude and service of the funeral parlour, and others’ experience with them.

‍

Incorporating funeral costs into your financial planning is a proactive step that can save your loved ones from financial strain and emotional distress. By building an emergency fund, you ensure that unexpected funeral expenses are covered, providing peace of mind and financial security. Personal finance blogs, such as Eugene Chai’s, are a useful resource for more insights on personal finance, from financial planning to insurance and credit cards.