Using a credit card to pay funeral expenses

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.

You can pay a funeral account by credit card only if the funeral home accepts cards, so ask first and ask whether it adds a surcharge. The card debt is yours, interest can run from the day of the charge, and getting the money back from the estate depends on the estate having enough and on how fast it is settled. Try the other options below first.

This page is for someone who may be arranging a funeral now. It is general information, not legal advice. The sums use round example numbers, labelled as such, because we found no source for what funeral homes charge for card payments or for the interest rate on your card. Check your own card terms.

Surcharges: ask before you pay

A surcharge is an extra fee a business adds when you pay by card. The Commerce Commission's guidance says "every business should offer at least one surcharge-free payment option", that any surcharge "should only cover the extra cost compared with the surcharge-free option", and that it expects in-person surcharge rates to "reduce toward 1% or lower for most businesses". It says it can issue surcharging standards (Commerce Commission: Making and accepting payments). The page lists two guidance documents dated July 2023, and we have not checked whether a later rule applies, so ask the funeral home about its surcharge.

On a funeral invoice, small percentages are large sums. As an example only: 1% of a $10,000 invoice is $100 and 2% is $200. Ask the funeral home three things:

Do you take cards for the whole account, or only for a deposit?
Is there a surcharge, and what is it as a dollar figure on my invoice?
Is there a payment option with no surcharge, such as a bank transfer?

Interest: what carrying the balance costs

Credit card interest rates "can range from 13–29%", according to Sorted's guide to credit cards. Most cards have an interest-free period of about 44 to 55 days only if you pay the balance in full, and if you carry a balance interest is charged from the day of each purchase, not the statement date. Minimum payments are typically 2% to 5% of the balance, which Sorted says "barely covers the interest" (Sorted: Credit cards, no date shown).

The table shows the interest on a $10,000 balance if you pay nothing off. It is our arithmetic, a simple approximation (balance × rate × months ÷ 12) that ignores compounding, and the rates are the ends and the middle of Sorted's range, not your card's rate.

Months carried	At 13% a year	At 20% a year	At 29% a year
1	$108	$167	$242
2	$217	$333	$483
3	$325	$500	$725
6	$650	$1,000	$1,450

How long might you carry it? The Ministry of Justice's probate guide gives a typical timeframe of 15 working days for a grant, unless more information is required, and govt.nz says it "usually takes 6 to 8 weeks" (Ministry of Justice: probate guide; govt.nz: Wills, probate and estates). A grant is not the end: the estate still has to gather its money. So two months is a realistic example and six months is a bad case. We found no figure for an average, so do not read the six-month row as typical.

Who owes what

The card debt is yours. The card company treats a funeral like any other purchase. You owe it whatever happens to the estate.

The estate may owe you, but not in a way you can count on. Community Law says the executor, or the person lawfully in control of the body, makes the final decision on funeral arrangements (Community Law: Funerals and tangihanga). If the estate cannot pay all its debts in full, section 31 of the Administration Act 1969 lets the administrator use the Insolvency Act 2006 order of priority, where reasonable funeral expenses come second, after the costs of administration and before medical and hospital expenses from the last three months. Funeral expenses are not paid first. That is a rule for an estate that cannot pay everyone, and an estate with enough money has no such problem; it still has to be located, valued and released. Keep the itemised invoice and your receipt so the executor can reimburse you.

A small amount may be released without probate. Where a bank or other payer holds money for the person and no one has applied to receive it, section 65(3) of the Administration Act lets the payer use it to pay the funeral expenses or refund whoever paid. The prescribed amount for a payment without administration is $40,000 from 24 September 2025 (SL 2025/158). This is something a payer may do, not must do, so ask the bank rather than assume (Administration Act 1969).

Try these first

The deceased's bank. govt.nz says banks can release funds for funeral costs without the person being the executor and without waiting for probate (govt.nz: What to do when someone dies). Ring the bank and ask what it needs. A joint account passes to the surviving owner and is not part of the estate (Community Law: Dealing with the deceased's property).
The Work and Income Funeral Grant. Up to $2,697.43 (page updated 24 June 2026), for a partner, parent or guardian, a child under 18, or a single person over 18 whose funeral you arrange. Income tests apply for a partner or child, and the deceased's assets are counted. You apply with an itemised account and, if you have paid, a receipt and bank details, and the page says there is no time limit (Work and Income: Funeral Grant). See the Funeral Grant guide.
The ACC funeral grant. Up to $8,236.40 where the death was caused by a covered injury, set by the date of death. It is paid to the funeral director or reimbursed (ACC: Financial support after a death, page published 22 July 2026).
Insurance or a prepaid plan the person held. A prepaid plan or trust pays the funeral invoice directly. Some life policies include a funeral payment: Kiwibank's life cover, underwritten by nib, includes a $15,000 funeral expenses lump sum, and Asteron says it advances funeral money once a claim is accepted. Check the person's papers and ring the insurer. Our guide to life insurance payouts after a death explains the process.
Family and the funeral home. Ask the funeral home about timing. A smaller funeral costs less: FDANZ's 2026 report puts an unattended cremation at an average of $4,700 and a full cremation funeral at $11,700 (FDANZ, 2026 report). Our funeral costs section has current prices.

For the executor's side, including paying invoices from estate funds, see paying funeral costs from the estate and who pays for a funeral.

Checklist before you use a card

Get the invoice itemised and in writing.
Ask about a card surcharge and a surcharge-free option.
Ring the bank about releasing funds, and check for a joint account.
Check for insurance, a prepaid plan or a funeral trust, and ring them.
Apply for the Funeral Grant or ACC grant if the person fits.
If you still use a card, use the card with the lowest interest rate, note the date, and plan to pay it off as soon as money arrives.
Keep the receipt for the executor.

Planning ahead with funeral insurance

A card is a bridge, not a plan. Funeral insurance pays a fixed benefit towards costs, not the full invoice. Momentum Life's Funeral Insurance, issued by Momentum Life Limited, is open to New Zealanders aged 40 to 75 with no health questions, for benefits of $3,000 to $30,000. For the first 24 months it pays only for accidental death (within 90 days of the accident); any other death in that window pays no benefit and all premiums are refunded. Total premiums can end up larger than the benefit, and the benefit may not cover the whole funeral. Momentum's A.M. Best rating is B (Fair); see its financial strength page. Details are on the Momentum Life Funeral Cover page. Savings and a prepaid plan are the other routes.

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). Back to the guides hub, or read about probate.

If you are planning ahead for your own funeral costs

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Life cover: Conditions you already have aren't covered for the first 2 years (premiums refunded instead). Suicide isn't covered for the first 2 years, and a few conditions can be excluded permanently.

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.

Insurer: Momentum Life Limited. Financial strength rating B (Fair) from AM Best, affirmed 11 February 2026; B ratings sit in AM Best's 'vulnerable' range. The rating scale is available for inspection at every Momentum Life office in New Zealand. What this means

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

Opens Momentum Life's online application; its guidance only covers eligibility. QuoteHub is a Momentum Life partner. Smiths Insurance & KiwiSaver may receive a commission if you buy. General information, not advice.

Adviser's view

A card is a last resort for a funeral account, not a first one. The debt is in your name, interest can run from the day of the charge, and getting the money back from the estate takes time and is not certain. Try the bank, the grants and any insurance first, and if you use a card, ask about a surcharge.

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

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Cite this page QuoteHub NZ (2026). Paying Funeral Costs by Credit Card NZ: Risks and Fees. www.quotehub.co.nz/guides/when-someone-dies/paying-funeral-costs-credit-card-nz. Updated 2026-10-20.