Chapter 5: Impact of FSP on clients' financial wellbeing
Clients tended to be already living with financial stress at the point of bereavement, and even those who felt relatively comfortable said they would have struggled to pay for the funeral without FSP. There were also cases where bereavement had directly worsened clients' financial circumstances, for example by causing changes in benefit entitlement.
Clients expressed shock at the cost of a funeral. Without FSP, they said they would have had to borrow money or cut back in other essential areas to pay for the funeral. FSP therefore had a positive impact on clients' finances and helped clients avoid financial 'turmoil'.
However, the financial impact was limited by the fact that clients still found it hard to find the money for the elements of the funeral not covered by FSP, and in some cases had to take on debt to do so. Clients also experienced financial stress while waiting for their FSP application to be approved, an issue exacerbated where there were delays in the process.
This chapter will discuss the impact of FSP on recipients' financial situations. It will seek to address the following research objectives:
- Whether and how the FSP helps to reduce debt for people on low incomes in relation to funeral costs, exploring:
- Impact on household budgets.
- How costs would have been covered without access to FSP.
It will first explore the reported financial circumstances of FSP clients at the point of bereavement, followed by their views on funeral costs. It will then turn to the impact of FSP on clients' finances, focusing particularly on any impact FSP has had on helping clients avoid debt. The findings in this chapter are largely based on research with FSP clients, with insight from third sector organisations and funeral directors incorporated where relevant.
Financial circumstances at bereavement
Participants did not to have access to prepaid funeral plans or have money left by the deceased from their estate for funeral costs. At the point of bereavement, FSP clients' financial circumstances ranged from them being relatively financially comfortable to being under significant financial stress. However, even those who felt relatively comfortable said they would have struggled to find the money for the funeral without FSP.
There were also cases where bereavement had worsened participants' financial situations. On top of the cost of the funeral, the loss of a relative may have resulted in changes to benefits (for example, having been in receipt of Carers Allowance to care for a relative, and becoming ineligible after that person died), or to household structure (for example, having taken on the responsibility of caring for the deceased person's children, at a financial cost).
"Immediately afterwards, my Carers Allowance stopped, then I had to apply for Universal Credit which you've got a five week wait and everything like that, so I think immediately after [the death] I was really kind of stressed and worried about [money]."
FSP client, 35-54, Ayrshire
Financial stress was also reported in cases where a client lost the person in their household they previously shared the weight of financial worries with. Clients in these circumstances might feel particularly alone in dealing with money worries.
"Whereas when I had my husband, I could bounce things off him, I had nobody to bounce it off of […] If I hadn't of got that payment I wouldn't have been grieving for him just alone, I would have been crying my eyes out, like he is gone and he is not here to help me pay for this. How the hell am I going to pay for it?"
FSP client, 55+, South Ayrshire
Given that clients were not, on the whole, easily able to afford a funeral, having to do so added additional emotional and financial stress. Participants who had not planned a funeral before expressed shock at the cost of different funeral elements.
"I wasn't aware, it was an eye opener. When I found out about the costs it was such a worry, the anxiety just hit me."
FSP client, 16-34, West Lothian
"You look at [the costs] broken down and you're like, 'Wow, it all adds up' and people don't have that [amount of money]."
FSP client, 55+, Dundee
This was particularly the case where the death had been unexpected and/or where the deceased did not have a funeral plan or leave any money to be used for the funeral. This view was supported in research with funeral directors.
"When they find out that there are no funds in the estate it must definitely take the edge off thinking they have got something there. […] I think [FSP] takes the edge off. Obviously, it is a stressful time when somebody has died and to be worried about finance as well, especially if it is a sudden death and it's come like a curved ball into their lives."
Funeral Director, smaller business, Argyll and Bute
Financial impact of FSP
There is evidence that FSP has had a positive effect on recipients' finances. Clients shared various measures they would have had to take to cover the funeral costs without the contribution of FSP.
Most notably, FSP reduced the extent to which clients had to borrow money to pay the funeral director. Depending on the support network they had available, this borrowing could have been in the form of loans from friends and family, taking on credit card debt, going into their overdraft, borrowing money from a lender, or remaining in debt to the funeral director until they were able to pay it off gradually.
"If I didn't get any help, God forgive me but I'd be dead before the rest of it would get paid. How long is it going to take me to pay £1800 back? [Taking an amount] every fortnight off my pension, I mean…"
FSP client, 55+, Renfrewshire
There were also clients who anticipated that they would have had to cut back on other areas of their life. For example, one reported that they would have sold their car to cover the costs, while another would have rationed their spending on essentials to pay the bill.
"Yes, it made a big difference. If hadn't got it, I would need to take the money from what I would spend on food, electricity, children going to university so that was helpful as I don't need to think about it. I might have been stuck with debt. I didn't expect the help to be like that."
FSP client, 35-54, North Ayrshire
Indeed, there were participants who described the situation that they would have found themselves in without the payment as a financial 'mess' or 'turmoil'.
"I don't have savings, so I mean it definitely was a godsend. I don't know what I would have done without the Funeral Support Payment, I really don't know what I would have done. […] I probably would have got myself probably into a financial mess."
FSP client, 35-54, East Ayrshire
"It lessened our financial worries a bit, it's not a small amount it's a decent amount. […] We would have been in financial turmoil [without it]."
FSP client, 55+, Edinburgh
Factors limiting the positive impact of FSP on finances
While FSP had positively affected clients' financial situations, its impact was considered to be limited by the fact it does not cover the entirety of funeral costs and therefore does not prevent people getting into debt altogether. Clients described still having to borrow money to pay for the remainder of the funeral costs, a point which was also raised by third sector organisations.
"The Royal London's funeral cost index showed the cost of a funeral in 2020 compared with the FSP award and you're talking about 50%, so in that sense for those people getting FSP they're still facing debt like they were before. That broad general situation hasn't changed."
Third Sector Organisation
Participants did not have equal access to different types of loans - in particular, not every participant had access to short term, low- or no-interest lending from friends and family. Clients found it easier to pay for expenses not covered by FSP where they had a wider support network in place, able to lend money or contribute to costs. For those who did not have support networks and were potentially planning the funeral alone or in the context of family conflict, it was more challenging to cover the remainder of the bill. Those without access to financial support from friends and family fell into two groups: they either lacked a support network and were isolated at the point of the funeral, or they had family and friends who were emotionally supportive but did not have the financial means to assist with the costs.
"That's the scariest part knowing that if I didn't have family, I don't think my parents would be buried at the moment because we don't have that money."
FSP client, 35-54, Glasgow
"I was just confused, […] I don't know. I feel I was on my own, obviously I have got a sister but she is just too kind of immature and wrapped up in her own life to deal with the stuff, and I was like, 'I have to step in and be the adult', and I was like scared, and I didn't have anybody else to talk to about the stuff, and no one was advising, the usual, so you just kind of go with what somebody is telling you at the time. So, I just, I wasn't sure if I was going to get any help."
FSP client, 35-54, Glasgow
It is also worth noting that, as discussed in Chapter 4, COVID-19 limited the funeral choices of participants who experienced a loss during the pandemic. It is therefore likely that the portion not covered by FSP is even higher during non-pandemic times (for example, to include catering for more guests or hiring a venue rather than having a grave-side outdoor service), exacerbating this issue.
The positive impact of receving FSP was also diminished, on occasion, where participants had experienced delays in receiving their FSP or in receiving confirmation of eligibility or amount. In these cases, clients felt the positive financial impact of FSP, but may have been in a more difficult financial situaion while waiting for information about their FSP claim.
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