Have you seen those ads on TV telling you how affordable a funeral plan can be? They say you can put money aside now to take the pressure off your family later. There are different ways to pay for a funeral, but some may be more suitable for you than others.

One of the easiest ways to pay for a funeral is simply to save for it. If you set up a savings account, separate to your everyday account, then you can pay into it how much you want and as often as you want.

If you want to arrange funeral cover you could look at a pre-paid funeral plan, funeral insurance, or a funeral bond. But which one is best for you?

The new campaign “Avoid a funeral rip-off” aims to inform Aboriginal consumers about the different funeral products that are available.

Funeral insurance is not savings. If you stop making payments you will lose your cover. And be aware you might end up paying a lot more than the actual cover you will get.

Pre-paid funerals let you pay for a funeral in advance through your funeral director. You can choose the type of funeral you want, and pay for the cost of the funeral at today’s prices. A new code of conduct has been released and will come in to effect on 1 March 2021. The code will set rules on how contracts and funds are managed, safeguarding consumer’s money. More information is available at buying prepaid funerals.

Funeral bonds are invested and will grow in value. The money can only be used for your funeral and normally can't be accessed earlier.

If someone comes to your door selling funeral cover you don’t need to sign up straight away. Ask for a copy of the brochure and tell them you'll think about it. Never feel pressured to buy anything. If you are interested in funeral cover then find out which option is best for you.

Here are some tips to help you avoid a funeral rip-off:

• Check if you already have funeral cover (e.g. through your superannuation or health insurance policy).

• If you want to buy a funeral product find out how much you will need to pay and when, and how much the product will cost you over the long term.

• Find out what the rules are if you stop paying, and when the company will not make a pay-out.

• Be careful signing up children. If you purchase cover while your children are young, you might end up paying a whole lot more than what the funeral will cost.

• Talk to someone you trust, such as another community member or a community worker, before you sign up for funeral cover.

If you are having problems with a funeral product you have bought, talk to a financial counsellor. They offer a free service to help you sort out money problems. Or you can contact Consumer Protection. 

You can follow our Aboriginal consumer rights Facebook page "Ask Us", or follow us on Twitter. 

There is a brochure title "Paying for Funerals" which is available from the ACCC, or by contacting us via email.

Avoid a funeral rip-off is a joint initiative of Australia’s Commonwealth, state and territory consumer protection agencies, through the National Indigenous Consumer Strategy Reference Group.