Funeral Debt Crisis Deepens as One-Third of Americans Borrow for End-of-Life Costs
A new Debt.com survey reveals funeral debt has become a significant financial crisis affecting American families, with 37% now borrowing for end-of-life expenses and credit cards being the primary funding method.
The financial burden of saying goodbye to loved ones has reached crisis levels in the United States, according to new data from Debt.com's annual Death and Debt survey. The percentage of Americans incurring debt after a death has surged dramatically from 14% in 2024 to 37% in 2025, representing a troubling escalation in financial vulnerability among households facing end-of-life expenses.
Credit cards have emerged as the most frequent funding method for these final expenses, with 59% of those who borrowed using plastic to cover funeral costs. Personal loans accounted for 38% of borrowing, while 22% turned to funeral-specific financing. The data reveals that nearly 3 in 5 Americans (57%) acknowledge they could not afford a loved one's funeral costs today without incurring debt, highlighting the widespread financial unpreparedness for these inevitable expenses.
The financial repercussions extend far beyond the funeral service itself, creating long-term financial stress for grieving families. Over one-third (36%) of Americans reported they would delay paying other essential bills such as rent, credit cards, or utilities to cover funeral costs. Following services, 25% reported feeling anxious due to funeral-related debt, 19% struggle to keep up with payments, and 17% had already postponed other bills to manage this debt.
The survey data shows Americans are taking on increasingly larger amounts of debt for funeral expenses. Those borrowing less than $1,000 doubled from 6% in 2024 to 13% in 2025, while those taking on $1,000 to $5,000 nearly tripled from 6% to 17%. The most concerning increase appears in the highest debt category, with Americans borrowing more than $5,000 jumping from 2% to 7% year-over-year.
Howard Dvorkin, CPA and Chairman of Debt.com, explains the underlying dynamic driving this crisis. "Funeral costs have become a new financial crisis. Families want to honor their loved ones, but too often, compassion outweighs affordability — and credit becomes the only way to say a final goodbye." The emotional weight of loss combined with societal expectations creates a perfect storm for financial decision-making that prioritizes immediate needs over long-term financial health.
The survey also uncovered significant gaps in financial planning and knowledge regarding end-of-life expenses. Half of all Americans have not discussed how their debt or funeral expenses will be handled, indicating a widespread avoidance of difficult but necessary conversations. While knowledge about what happens to someone's debt after they die remains higher than 2023 levels, it has decreased from 61% in 2024 to 55% in 2025.
Generational analysis reveals distinct patterns in how different age groups approach funeral financing. Generation X, the generation balancing both children and aging parents, carries the most debt from loss and most frequently turns to credit cards. Millennials show a stronger preference for personal loans compared to other age groups, while Baby Boomers outpace other generations in using funeral-specific loans. For more insights and information visit: https://www.debt.com.