How to arrange funeral prepayment in New Zealand

Written by Henry Smith · Reviewed by Smiths Insurance & KiwiSaver, licensed Financial Advice Provider (FSP712931) · Updated 2026-10-20 · Reviewed quarterly, when the underlying data is restated.

Financial advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). QuoteHub is a trading name.

To prepay a funeral in New Zealand, choose a funeral director or a trust provider, get an itemised written quote, check the contract, pay into the arrangement and tell your executor. Where the money is held and what the contract promises differ between providers, so the contract check is the step that matters most. About 74% of deaths in 2025 had no pre-arrangement or pre-payment (FDANZ 2026 industry report).

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Prepaying is one of several ways to fund a funeral. It does not decide the funeral for you: the plan, the price and the payment are three separate things, and you can do the first without the others. This guide covers the practical steps and a contract check-sheet. It does not say whether prepaying is a good idea for you; our prepaid funeral pros and cons page does that, and how funeral trusts work explains the trust structures. Terms vary by provider and change, so confirm everything below with the provider on the day. Prices quoted are indicative and were read on 20 October 2026.

What to have ready

Your wishes written down: burial or cremation, service type, venue, celebrant, music. Our preplanning guide has a checklist.
Two or three funeral directors to compare, and their written price lists.
The name of your executor, and a copy of your will if you have one.
A view on how much you can afford to tie up, because money in a trust may be hard to get back.

The steps

Choose where to start. Either a funeral director (who may offer a plan through a trust) or a trust provider such as Public Trust. Community Law notes there is no legal requirement to use a member of the Funeral Directors Association of New Zealand (FDANZ) (Community Law). Only FDANZ members are bound by its Standards and Code of Ethics to be transparent about costs (FDANZ 2026 industry report). See how to choose a funeral director.
Pick the service level. Compare a no-service cremation, a simple service and a full funeral. The choice sets the price.
Get an itemised written quote. FDANZ says prices vary by director and recommends a written estimate. Ask which external costs (shaded in its tables) are included, because the director usually pays them and passes them on (FDANZ: financial matters).
Read the contract against the check-sheet below.
Choose how to pay. A single sum or instalments. The Funeral Trust's last published FAQ gave a minimum first payment of $200 and $20 a fortnight by automatic payment, but terms were being restructured from 2025, so confirm them.
Pay, and keep the receipt and contract. Get written confirmation of who holds the money. A cooling-off period may apply: the Funeral Trust FAQ allowed a full refund if you cancel within 21 days of applying.
Tell your executor and your family. Give the executor the contract and the provider's contact details. The executor, or the person lawfully in control of the body, makes the final decision on the funeral, and a prepaid plan helps only if they know it exists.

Contract check-sheet

Question	Why it matters
Is this a fixed price for listed services, or a sum held toward the final cost?	We found no source that sets out how NZ prepaid plans divide between these, so ask. It decides who pays if costs rise
Where is the money held, and by whom?	Consumer NZ says other funeral homes may use their own trust arrangements "with different terms". Ask for the trustee's name in writing
What are the fees, now and later?	Now For Them says "no fees" and will say if that changes; Public Trust charges a set-up and an end fee. Ask whether fees can change
Does it earn interest, and is it taxed?	Now For Them says no interest or return is paid; Consumer NZ says tax may apply to interest earned
What is excluded?	Ask whether the cemetery plot, council interment and cremation fees, celebrant and notices are in or out. FDANZ lists pre-purchasing a plot as a way to avoid future council price rises
What happens to a surplus or a shortfall?	Leftover money goes to your estate (Consumer NZ and the Funeral Trust FAQ). A shortfall falls on the estate or family
Can another funeral director use it?	The Funeral Trust FAQ says another firm can use the funds, and a non-member's executor can apply to the trustee
What if the funeral home closes?	Ask this directly, as Consumer NZ advises. See what happens if a prepaid provider fails
Can you cancel or withdraw?	The FAQ allows withdrawal only on permanent emigration or extreme hardship after the cooling-off period

On the money-holding question, we found no New Zealand rule we can cite that sets where prepaid money must be held, so do not assume the funeral home keeps it apart from its trading account. Treat it as a question the provider must answer. Public Trust says its fund is under a government guarantee, which is Public Trust's statement and is covered in our Public Trust guide.

What it does to benefits

Prepaid funeral expenses of up to $10,000 each, held in a recognised funeral plan, are not counted in the residential care subsidy asset test (Work and Income, updated 4 August 2026). But a prepaid funeral account counts as a cash asset for the Funeral Grant, which is up to $2,697.43 (Work and Income: Funeral Grant). Check both before you pay.

What a quote might look like

FDANZ's indicative ranges (July 2025, "vary per funeral director") show what an itemised quote can contain: a professional services fee of $3,000 to $6,500, a casket of $1,200 to $5,000, a cremation fee of $600 to $1,100 or burial with plot and interment of $1,000 to $8,000, plus celebrant, chapel, flowers and notices. FDANZ's 2026 report puts a typical attended cremation funeral at $11,700 and a burial funeral at $14,300. Compare your quote with those and with our funeral costs data.

What happens next

Nothing happens until the death. The executor or family contacts the provider, who arranges the funeral against the contract and settles the invoice from the funds. Any surplus goes to the estate, and a shortfall is paid by the estate or family. If you move cities, ask now whether another director can honour the plan.

Planning ahead with funeral insurance

Prepaying is one choice; you can also do it alongside, or instead of, taking out cover. If you want to compare, Momentum Life Limited issues Funeral Insurance for New Zealanders aged 40 to 75, with no health questions and a fixed benefit of $3,000 to $30,000. In its first 24 months it pays only for accidental death (within 90 days of the accident); for any other death in that window the benefit is not paid and the premiums for that person are refunded. Premiums can add up to more than the benefit, and the benefit may not cover the whole funeral. Putting the money aside yourself is the other way to prepare. Momentum Life holds an A.M. Best rating of B (Fair), affirmed 11 February 2026; see its financial strength page. The buttons on this page open Momentum Life's online application. QuoteHub is a Momentum Life partner and Smiths Insurance & KiwiSaver may receive a commission if you buy a Momentum policy (how we are paid). Advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). This page is general information, not advice. See the funeral insurance hub and funeral insurance versus a prepaid funeral.

Get a quote and apply online today

See your price in about a minute, then apply online with Momentum Life. Guaranteed acceptance, no health questions, no medical exams.

Funeral cover See your price Ages 40–75 · $3k–$30k Life cover See your price Ages 18–65 · $50k–$300k

Want more cover or have questions? Talk to an adviser

Funeral cover: Only accidental death is covered for the first 2 years. Total premiums can add up to more than the cover, and it may not meet the whole cost of a funeral.

Already have cover? Keep it. New cover won't pay for a condition you already have in its first 2 years.

Adviser's view

Prepaying is easy to start and hard to undo, so the contract is the part to read slowly. Ask whether you are buying listed services or paying a sum toward whatever the funeral costs, where the money is held, and what happens to a surplus or shortfall. We found no rule that sets where prepaid money must sit, so make the provider say it in writing.

Henry Smith, Financial Adviser (FSP1010699). General information, not personalised financial advice.

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Cite this page QuoteHub NZ (2026). How to Prepay a Funeral in NZ: Steps and Contract Checks. www.quotehub.co.nz/guides/when-someone-dies/how-to-prepay-a-funeral-nz. Updated 2026-10-20.

References

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