Axel Jean-Francois
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Based on mainstream 2026 forecasts, here’s what funeral professionals need to watch.
Interest Rates and Business Borrowing in 2026
Let’s start with the big, invisible hand everyone’s felt but no one invited: the Federal Reserve. The Fed controls short-term interest rates by setting the “federal funds rate,” basically what banks charge each other to borrow money overnight. It’s not thrilling—but it drives everything from mortgage rates to commercial loans to your credit card APR. In 2026, that rate is projected by major banks and federal agencies to hover around 3.5–3.75%, down from the 2023 highs, but still miles above the near-zero era of the 2010s.
For funeral homes, that means: higher payments on expansion loans, pricier lines of credit, and less room for error if calls dip. On a $1 million, 10‑year note, even a couple of percentage points equals thousands more per month.
Translation: Borrowing still isn’t cheap. If you’re eyeing a remodel, a new vehicle, or debt consolidation, plan for financing that bites. Forecasts say we might see one, maybe two minor rate cuts – but nobody expects a return to the good days of 2% loans. Some economists don’t expect cuts at all. If you’re holding out for relief… don’t. Instead, lock in fixed rates where possible and budget as if rates are staying put. Predictability isn’t always ideal, but it’s useful. If the economy tanks? Sure, rates may fall – but barring disaster, expect your interest expense line to stay thicker than you’d like.
Inflation Trends and the Cost of Doing Business
We’ve all felt the pain of inflation – from casket costs to gas prices to that weird surcharge on your paper towel shipment. The good news? It’s cooling. The bad news? It’s not gone. Forecasts peg inflation around 2.4–2.8% in 2026. Not quite the Fed’s 2% target, but a far cry from the chaos of recent years. Think of it like a fever that’s gone from “hospital trip” to “rest and hydrate.”
Expect small, steady price hikes in everything from embalming fluid to utility bills. Imported merchandise like urns or caskets? Still pricey, thanks to tariffs. A $1,000 casket with a 25% tariff now costs $1,250—and if you haven’t moved your GPL in 3–4 years, you’re likely absorbing that cost instead of passing it through.
Energy-wise, gas and diesel might fall slightly – good for your fleet – but natural gas and electricity? Headed up. That’s bad news if you run a crematory. One part of your energy budget might go down while another spikes. Welcome to 2026.
The key tactic: stay nimble. Renegotiate vendor contracts, update your GPL, and keep some margin buffer. If you’re running tight, your pricing needs to flex as costs creep.
Labor: The Hiring Headache Continues
Unemployment is forecast around 4.4% in 2026 – higher than the tightest labor days, but still low by historical standards. Translation: hiring is still hard, especially for small service businesses. And funeral homes, already facing a graying workforce and shrinking pipeline, feel it acutely.
Whether you’re looking for licensed directors, crematory operators, or support staff, the story’s the same: hard to find, harder to keep. Wages are still rising, likely 3–4% annually—faster than inflation and some revenue lines.
So what do you do? Get creative: flexible shifts, cross-training, apprenticeships, surprise lunches, or licensing stipends can move the needle. And if you can’t win on pay, win on predictability: stable schedules, clear on‑call rotations, and real weekends off when possible. It’s cheaper to retain than rehire. Make your place one people stick with.
Also: if unemployment creeps above 5%, hiring might ease—but it could also signal softening demand. Stay nimble.
Tariffs and Trade: Easing up
Tariffs haven’t gone anywhere. Many funeral goods – caskets, urns, cremation machines – are imported or use imported components. These come with baked-in increases from trade policy. There’s less chaos than peak trade war years, but costs are still up.
Keep an eye on a few 2026 developments:
- The U.S.-Mexico-Canada Agreement is up for review mid-year. No big changes expected, but if you import from across borders, track it.
- China tariffs? Still here. Changes will hit your invoice before your news feed.
- New trade deals could help, but no miracles expected. Global posture is cautious.
Talk to vendors. Ask about sourcing. Explore backups. Bulk order if you suspect hikes ahead. You’re not powerless—but you do need to stay alert.
Consumers and Credit: The Families You Serve
Families are stretched. Yes, wages have risen, but so have debt loads. Credit card balances are at records, with APRs over 20% in many cases. Add resumed student loan payments and expensive car loans, and households have less cushion.
Put bluntly: even employed families feel poor. That shows up in smaller services, more cremation, and more price‑sensitive shoppers.
You might see:
- More families asking for payment plans.
- Growing interest in direct cremation or simplified services.
There’s been chatter about capping credit card rates—including a 10% proposal floated by the Trump administration. It’s not becoming law anytime soon, but it shows that lawmakers understand households are stretched. It’s not help yet—but “something” might be coming. Keep an eye out.
Thinking About an Exit? Read This.
Higher rates haven’t killed deal activity; they’ve just made buyers more discerning. That’s good news if your house is in order—and a warning if it’s not.
Buyers are still active. They’re looking for quality: consistent call volume, organized records, compliance, local presence. Not flash—just fundamentals.
If you’ve been investing in your team, tightening your systems, and running with discipline, that’s value. It doesn’t guarantee a deal, but it puts you in the conversation.
And if you’re thinking about succession, a future exit, or just curious what your business might be worth? You don’t have to figure it out alone. Foresight can help benchmark your readiness and help you chart a path forward.
Because planning to sell isn’t just about cashing out. It’s about securing the legacy you’ve built.