When it comes to planning for the future, the British are among the worst in the developed world. With our savings rate at a 47-year low and millions of working adults still failing to stash away anything like enough to provide them with a healthy retirement, it should come as no surprise that we are also some of the least likely in the West to have made any provision for ourselves when we die.

Although the majority of Britons have relatively strong opinions about whether they would prefer to be buried or cremated, more than 60 per cent of us have never told anyone what that preference is, let alone thought about making financial provision for our own funeral.

For those who are left behind, however, arranging a funeral can be a complicated and expensive exercise – often at the time when you are least equipped to deal it.

Pre-payment plans

Taking out a pre-paid funeral plan can relieve a lot of the stress, as well as the financial strain, from your family when you die. Plans offered by the likes of the Co-operative funeral group, Dignity, Golden Charter and Age Concern typically cost between £1,500 and £3,000, depending on your requirements and where you live.

If you're opting for one of these, it's important to check exactly what they cover. Some will only guarantee to cover certain costs – and will only make a contribution to secondary costs – but others will ensure that your family are not forced to pay a penny. For example, Dignity's plan will only make a contribution to secondary costs such as the doctor's medical certificates or fees for a minister, while the plans offered by the Co-op or Age Concern include all these additional costs.

Alison Gray of Co-operative Funeral Services says that the majority of customers choose such plans for peace of mind: the certainty that their family will be left with the minimum of organisational duties and no financial strain when they are gone.

The Co-op offers three different types of standard plans, with costs rising for those who opt for more expensive coffins or for limousines to drive the family to the funeral. Gray says that it is also possible to order a tailor-made plan, specifying, for example, that you'd like a horse-drawn hearse or a natural burial. Quotations for these are made on an individual basis.

Some insurers, such as Axa, also offer insurance plans that you can take out regardless of how old you are, and that promise to pay out a lump sum as long as you don't die within the first 12 months of the policy. However, says Tom McPhail of Hargreaves Lansdown, the financial advisers, these insurance plans do not tend to represent very good value for the consumer. In most cases, you'll get a better deal by buying a pre-paid funeral plan, or simply putting some money aside in a savings account and leaving strict instructions for your funeral in your will.

Starting from scratch

The majority of families are left to organise funeral arrangements from scratch, and although it is often a difficult time emotionally, it's important to make sure, before you commit, that your funeral director is clear about exactly how much you will be charged. Mike Jarvis of the Natural Death Centre (www.naturaldeath.org.uk), a charity that provides free advice for the recently bereaved, says that some funeral businesses still, unfortunately, take advantage of the vulnerability of their clients.

"Shopping for funeral services is a distressed purchase – people don't shop around like they would do for a washing machine," he says. " But if they go to someone who says, 'Leave it all to us', the next thing they might know is that they're being handed a great bill for a whole list of things that they didn't want."

Jarvis recommends that families use the online search facilities provided by the two funeral directors' trade associations, at www.saif.org.uk and at www.nafd.org.uk. Both can provide details of their members in your area. "Those [funeral businesses] that belong to professional trade bodies, such as the SAIF or NAFD, are signed up to codes of practice, which require them to publish price lists and to send itemised bills," Jarvis says.

"Generally, our view is that most people are better off with small, independent, local firms, as they tend to be run by people with their feet in the local community, people who are not being driven by targets."

According to Mintel, the average cost of a funeral in the UK has risen over the past 15 years from £950 to more than £2,200. So it is important to work out exactly what you want. Paying for extras such as multiple limousines for a funeral procession, or selecting wood-veneer coffins, can greatly increase the price. However, the greatest expense is usually booking a cremation or burial plot, which can come in at anything from a few hundred to several thousand pounds, depending on which part of the country it is in.

"Not surprisingly, parts of London and Surrey are the most expensive in the country, while places like Anglesey are the least," says Jarvis. "In the south-west, for example, you could expect to pay in the region of £2,100 for cremation and £2,500 for a burial."

If you have been left to organise the funeral for a relative who has not made any financial provision for it, and has no other assets, you may be able to claim financial assistance from the Government. If you are receiving means-tested benefits, such as pensions credit or income support, the Government might provide you with up to £700 from the social fund. For more information, visit the DWP's website at www.dwp.gov.uk.

Green funerals

A cheaper and more environmentally friendly alternative to cremation or burial in a cemetery is a "natural burial", which Jarvis describes as a "very viable third way".

Coffins made of wood veneer often contain formaldehyde, making them bad for the environment no matter whether they are burnt or left to break down into the earth, Jarvis points out. Equally, he says, the mercury used in tooth fillings can have dangerous effects when it is burnt and released into the atmosphere.

Natural burials, on the other hand, allow people to be buried on land that is to be converted into forest, or even a flower meadow. At most woodland burial sites, a tree is planted where the burial takes place. And instead of using varnished coffins, burials are carried out using fully biodegradable coffins made from bamboo or even cardboard. While most natural burial sites do not allow for plaques or any kind of tombstone on the site of the burial, Jarvis says that many have commemorative walls or areas where permanent memorials can be posted.

As well as being much more environmentally sound than regular burials or cremations, natural burials also tend to be much cheaper. In the south-west, for example, Jarvis says that the cost of a natural burial would be about £1,600, £1,000 or so less than a regular cemetery burial. " The first woodland burial site was opened 14 and a half years ago, and there are now 230 sites," he says. "There's been enormous growth. Some have very intensive tree-planting programmes, and some much less so. For example, they may be cultivating the landscape into a wild flower meadow."

Alternatives

Of course, cremation and traditional burials are not the only options when you die. If you prefer the idea of being buried at sea, for example, it's more complicated, but still possible. The Britannia Shipping Company for Burial at Sea (01395 568652) is the only business to offer such a service in the UK any more; you also need to get a licence from the Department for the Environment, Food and Rural Affairs. The only places where such burials are permitted to take place in the British Isles are off the coast of Newhaven in Sussex, or The Needles off the Isle of Wight.

Alternatively, if you believe that technology may one day make it possible to bring people back from the dead, you may want to request that your body be frozen or cryonically preserved. Alcor (www.alcor.org) charges $150,000 (£75,000) to "cryo-preserve" your entire body, or a mere $80,000 to simply preserve your brain. So far, Alcor claims to have more than 800 living clients subscribed to its service, and more than 70 people already frozen.

Some people prefer to donate their bodies to medical science when they die. If you want to do this, you need to sign a consent form before you die, which you can get from your local medical school. Although the school will not pay for your body, they will meet the eventual costs of a cremation, unless the family wishes to make their own arrangements and meet the costs themselves. There is no guarantee your body will be accepted, though, and the process can be difficult for relatives. For more information, visit the Human Tissue Authority's website:www.hta.gov.uk/about_hta/donating_a_body_to_medical_science.cfm.

For more information and advice about all types of funeral, call the Natural Death Centre helpline on 0871 288 2098. You can also order the Natural Death Handbook, over the phone or on the charity's website: www.naturaldeath.org.uk

'I want to go out with a bang at my funeral'

Alan Griffiths, a 58-year-old taxi driver from Prestwich, decided to take out a pre-paid funeral plan with Co-operative Funeral Services a few months ago, to provide peace of mind for his family when he passes away.

Although he expects to be around for many more years yet, Alan didn't like the idea of leaving his family to pick up any bills for his own funeral, and paid a lump sum of £2,530 for the Co-op's Premier plan.

Alan also chose to pre-pay for his funeral, to make sure it's an upbeat affair. As a big Guns N' Roses fan, he wants "Sweet Child o' Mine" to be played at the ceremony, and is adamant that none of his guests should wear formal clothes.

"It's something you aren't going to be around to arrange – but I thought, if I'm going out, I want to go out with a bang," he says.

Although Alan admits that funeral's have become an expensive affair, he was attracted to the fact that the Co-op plan allows for inflationary rises in the costs, ensuring that his relatives should be left with nothing to pay for, even if his funeral is not for another 40 years.

His partner Carol says Alan has been much more relaxed knowing that it is all arranged and paid for.