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Sunday, July 12, 2009 •••

SECTION D

MoneyWise
HE FOUND JOB STABILITY DEAL DIVA: Which is cheaper:
AS A NURSE grocery stores or Wal-Mart? 3D
Charlotte man spent his savings,
went without health insurance TAKING CARE: It’s tough to
to pursue a new career. 3D search for work if you’re sick. 4D
charlotteobserver.com/business

TODD SUMLIN – tsumlin@charlotteobserver.com


Fred Oates helped dig a grave at Oaklawn Cemetery Wednesday in Charlotte, where a survey shows the city’s average funeral costs $5,500, while cremations average $2,821.

Death and dollars


With 1 company dominating the market, Charlotte leads the nation when it comes to burial, cremation costs.

By Cameron Steele high prices on Service Corp., a Houston-based company Service Corp.’s market share
csteele@charlotteobserver.com
that owns more than 1,300 funeral homes nationwide, The charts below indicate Service Corp. International’s market
When Service Corp. International, the nation’s largest including 60 percent of the homes in Charlotte. share percentage of the national and Charlotte funeral
funeral-home chain, bought its biggest competitor in industries. Service Corp., the nation’s largest funeral-home
“It’s called controlling the market, and I hate to say
chain, owns the majority of funeral homes in Charlotte.
2006, it took a commanding stake in the Charlotte mar- that it’s working,” said Tito Truesdale, co-owner of Rosa-
ket and promised to provide quality services and reason- dale Funeral Parlor, an independent home on Albemarle National
able prices. Road in east Charlotte that competes with Service Corp. 90% Private, family-owned funeral homes
But three years later, a new survey shows what con- Shawn Strickland, Service Corp.’s market manager for 7.8% Service Corp. International
sumer advocates at the time feared: Charlotte funeral the Charlotte area, says he doesn’t believe the results of 1.4% Stewart Enterprises
prices have risen, making the city the most expensive in the survey because he thinks that funerals in big cities 0.7% Carriage Services Inc.
which to be buried or cremated. According to a June such as New York and Washington cost far more than in 0.1% Stonemore Partners
survey by Everest Funeral, a research company that Charlotte. He said Service Corp. offers a wide range of
works with consumers and life-insurance companies, prices but that the basic price for a funeral is determined Charlotte
average funerals in Charlotte cost $5,500, while crema- by the cost of that home’s overhead.
tions average $2,821. 60% Service Corp. International
“It’s such a subjective question, because it really de- ( 6 funeral homes )
The figure for funerals is $1,600 more than the South pends on the family and what they want to see happen,” 30% Private, family-owned funeral homes
Atlantic average and $1,500 more than the national aver- he said. “We don’t have pricing any much different than 10% Keystone Group
age, according to the National Funeral Directors Associ- anyone else does.”
Source: Everest Information Services LLC and IBISWorld Inc.
ation. The president of the local chapter of Funeral Consum- Research: CAMERON STEELE Charts: DAVID PUCKETT
Some local independent funeral directors blame the
SEE DEATH, 2D

Sales of Jackson items Once they’re gone, 401(k)


matches might not return
show power of collectibles Some companies look to
redirect former match
money to health care,
His memorabilia is red-hot, training, other benefits.
and the hobby is big in a
By David Pitt
down economy. But be alert Associated Press
to fads, experts warn. As if we needed another sign that
this may be the Great Recession, it
By Pamela Yip appears some companies that sus-
Dallas Morning News pended their 401(k) match might
One day after the death of Michael not restore it completely.
Jackson, Heritage Auction Galleries In past downturns, most compa-
was besieged with calls asking what nies that stopped matching employ-
his memorabilia is worth. ee contributions to 401(k) accounts
“The general consensus is that simply reinstated the match when
whatever it was worth yesterday, to- the economy recovered. This time
day, it’s probably worth double, if not might be different. Consultants re-
triple,” said Noah Fleisher, spokes- port that clients are considering op-
man for Dallas-based Heritage, the tions including tying their 401(k)
largest collectibles auctioneer in the match to profits or using some of
world. that money for other benefits.
Collecting is a big business, and it’s BRYAN CHAN-POOL – GETTY IMAGES FILE PHOTO Companies have more flexibility
become even more so as the recession Michael Jackson signs autographs for fans as he arrives at his civil trial in than most people think when it
has led many consumers to rummage Santa Maria Superior Court in November 2002, in Santa Maria, Calif. comes to their 401(k) plans.
through their attics and basements to The current average match is 50
see what can be sold and turned experts say that’s how you should first a surge of interest in collectibles cents on the dollar up to 6 percent McCLATCHY-TRIBUNE ILLUSTRATION
quickly into cash. Craigslist, for in- approach collecting. linked to the pop legend. But the tar- of pay. For example, a worker earn-
stance, has seen its “For Sale/Collect- “A true collector buys items be- nish to Jackson’s image from the ing $50,000 a year contributes 6 per- $25 million a year by suspending
ibles” section grow 60 percent in the cause he or she loves to collect,” not strange turns his life took and the ex- cent, putting $3,000 into the 401(k) their 401(k) match. When you’re
last year, a Craigslist spokeswoman because they’re trying to make a buck, pected litigation over his affairs could account and the company puts in talking that kind of money, it’s easy
said. said Todd Imhof, executive vice presi- erode the collectibles’ long-term val- $1,500. to see why it becomes a target in bad
But much of collecting has to do dent of Heritage and a rare coin ex- ue, industry experts say. Using that average figure, compa- economic times.
with the emotion someone feels to- pert. The value of Jackson’s memorabilia nies with more than 15,000 employ- But potential changes coming
ward a person, object or genre, and Jackson’s unexpected death creates SEE COLLECTIBLES, 2D ees can save in the neighborhood of SEE RETIREMENT, 2D
2D Sunday, July 12, 2009 ••• BUSINESS charlotteobserver.com • The Charlotte Observer

DEATH so point to Charlotte’s high cremation


percentage – 30 percent of Charlotte’s Tips on choosing a
• from 1D deceased are cremated – as the reason funeral home
for escalating burial costs. Crema- • Ask for a list of general prices.
ers Alliance, a nonprofit group that tions appeal to people everywhere be- • Ask what is included in the
works to educate consumers about fu- cause they’re cheaper, said Cook, but funeral service fee and what cem-
neral-service options, said Service they are particularly popular in Char- etery costs will add to that fee.
Corp.’s hold on the Charlotte market lotte because of its transient popula- • Know that you can negotiate.
easily makes the city the priciest for tion. • Find out whether the home is
funeral services. “If people want to be here only for a corporation-owned or independent
“I hate that Charlotte is at the top of brief amount of time, they will be able and which one offers the type of
the list, but I don’t doubt it one bit,” to take their loved ones with them service you need.
said Mary Brack. The Funeral Con- when they move,” Cook said. The • Go to different homes around
sumers Alliance doesn’t have a survey shift from high-cost burials to crema- your area to compare price lists.
that compares funeral pricing in dif- tions threatens revenue for the funer- Go to www.funerals.org for help
ferent cities, but Brack said she’s al industry, which can force overhead from nonprofit group, Funeral
known for a while that Charlotte had prices to go up. But that doesn’t ex- Consumers Alliance.
to be one of the most expensive. plain why Charlotte outranks all other
Local Service Corp. funeral-home cities for funeral expenses because
owners offer a variety of explanations cremations have been on the rise na- Five most expensive
for Charlotte’s top ranking. They said tionwide, attributing for 37 percent of cities for funerals
cemetery costs and property taxes are the industry. Average cost
rising, and that the move toward less- DAVIE HINSHAW – dhinshaw@charlotteobserver.com Financially squeezed families that Traditional Cremation
expensive cremations is forcing up Charlotte’s T.H. Robertson owns a private funeral and cremation practice are going ahead with burial plans are 1. Charlotte $5,500 $2,821
traditional-funeral prices to maintain and meets customers in their houses instead of a funeral home to cut costs. opting for less formal services. That
revenue. means cutting out limousine rides, 2. Chicago $5,046 $1,878
Funeral pricing varies, but experts The average price of a Charlotte fu- Service locations and Wilson Funeral purchasing less ornate caskets and in 3. Nashville $4,983 $1,941
said smaller, independent companies neral with Service Corp. has risen 10.5 and Cremation Service. some cases putting off tombstone 4. Louisville $4,963 $2,138
tend to be less expensive than larger percent to about $6,300 from about “Charlotte is unique,” said Mark purchases, funeral industry experts
chains because they have less corpo- $5,700 in 2006, another Everest sur- Duffey, president and chief executive say. 5. Boston $4,958 $2,311
rate overhead and don’t have to pay vey indicates. Nationally, Service of Everest. “Usually you don’t see that Source: Everest Funeral survey
dividends to shareholders. Corp. funerals cost $5,097, which is level of consolidation, which is what
Antitrust accusations
about $1,200 less than the company’s makes (funerals) so expensive there.” Service Corp. has run into antitrust
Price shopping Charlotte prices, according to the Everest is a national research com- accusations before. In 2005, the Fu- Barak Richman, a professor at Duke
When Mamie Stowe knew she was company’s most recent federal earn- pany that helps clients to compare fu- neral Consumers Alliance filed a University School of Law, said restric-
going lose her husband, Eugene, after ings reports. neral prices and create a customized class-action suit against Service Corp. tions are put on monopolies because
his two-year battle with cancer, she al- When Service Corp. bought Alder- funeral service with the home of their and other major players in the death- they can pose harm to market compe-
most dreaded the funeral-planning woods Group Inc. in 2006, the U.S. choice. Consumers pay $495 for un- care industry. The suit alleged the tition.
process more than his passing. Stowe Federal Trade Commission forced it limited access to Everest specialists companies conspired to overcharge “When all services in a market are
wanted to honor him with a church to sell one of the five Charlotte funeral and research data or get help from the customers on caskets by suppressing dominated by a single provider, out-
service. But she was afraid of being homes it had acquired. The FTC’s de- company as a life insurance benefit competition. While not dismissed, the put goes down and prices go up,” he
gouged by a funeral home that wanted cision reduced Service Corp.’s share through their employers. The survey case has not gone forward. said. “But if a monopolist charges
to be paid upfront and paid a lot. of the Charlotte-Gastonia-Monroe is based on a six-month national study In 1999, Service Corp. faced charges higher prices, that should theoretical-
After Stowe called around in June market to 44 percent from 62 percent that looked at basic funeral prices of from the New York state attorney gen- ly allow other people to enter the mar-
for quotes that were “ridiculous” and and attempted to prevent the merger homes in a 10-mile radius of each city. eral that the company was dominat- ket and provide services at a lower
too expensive, a social worker helped from raising funeral prices. But Serv- Brandon Cook, manager of Service ing the Jewish funeral home business cost.”
her find T.H. Robertson, owner of a ice Corp. still owns six out of 10 Char- Corp.-owned Forest Lawn Funeral there and hurting consumers by rais- Strickland said Service Corp. does
private funeral and cremation prac- lotte funeral homes, and prices have Home said Charlotte’s high taxes and ing funeral prices. Service Corp. set- not have a monopoly of the Charlotte
tice by the same name. Robertson is climbed in the years since the merger. cost of living escalate the area funeral- tled out of court, agreeing to sell three area and has continued to meet the
able to cut overhead costs by meeting Nationally, Service Corp. controls home prices. But that still doesn’t ex- of its Jewish funeral homes and pay needs of residents during their times
customers in their houses instead of only 7.8 percent of the funeral indus- plain why Charlotte ranks first on the the state $1.2 million for the investiga- of grief.
requiring them to come to a funeral try, with 1,302 funeral homes and 369 list of most expensive cities for funer- tion. “I don’t want to see you come in
home. cemeteries. The company has its larg- als while major cities with compara- Service Corp. also received civil-in- when you’ve had a death and have to
Robertson said his prices, starting est presence in Charlotte, owning ble or higher costs of living rank sig- vestigation demands in 2005 and spend a lot of money,” he said. “We
at $3,295 for funerals and $1,295 for Harry & Bryant Funeral Home, Forest nificantly lower – Washington is 12th, 2006 from the Maryland attorney can customize the service to fit any
cremations, are lower than Service Lawn West Funeral and Cremation New York is 15th and Houston is 20th. general about alleged anticompetitive budget.”
Corp.’s. Service, all of the McEwen Funeral Service Corp. funeral managers al- practices in the funeral industry there. — STAFF RESEARCHER MARIA DAVID CONTRIBUTED.

COLLECTIBLES What to look for RETIREMENT No more 401(k)


The Pension Rights Center, a
Washington-based consumer ad-
• from 1D Here are some questions to ask • from 1D match? Try these tips vocacy group, said it’s tracking
yourself when evaluating whether Human resources consul- more than 280 companies with
will spike for about a year or two and items could be collectibles: from Washington have some tant Hewitt Associates sug- suspended or reduced retirement
then most likely will settle back, Fleisher companies in limbo. Many com- gests: plan company matches. A string
said. SPORTS ITEMS panies might not restore the 1. Save more. The average of companies began announcing
“Autographs and items from Michael’s 401(k) match until they find out employee can bridge the suspensions or reductions in June
prime will prove to be the most valued • Was there limited production of the how much health care will cost savings gap a company 401(k) 2008, and the trend continues.
and cherished by fans looking to collect item, such as baseball cards? them, said Mark Ritter, an execu- match suspension creates by The list of companies includes
anything related to the legendary singer,” • Has the player made it into the tive director at business consul- boosting his or her contribu- widely recognized names such as
said Doug Norwine, director of music sport’s Hall of Fame? tant Grant Thornton LLP. tion by just 3 percentage Sears Holding Corp., Starbucks
and entertainment auctions at Heritage, • Is it the player’s rookie card? “Right now there’s a lot of fear points a year. Corp. and General Motors Corp.,
which will feature Michael Jackson ma- • Has an autograph or sports item about what the rules will be and 2. Diversify assets. Make as well as nonprofits such as Pub-
terials in its September auction. been authenticated? what’s the cost,” he said. “The sure you diversify your port- lic Broadcasting Service, the Port-
Norwine said collectors should keep thought is, we may have to rob Pe- folio by regularly rebalancing land Art Museum and the Ameri-
POP CULTURE
in mind that a flood of Michael Jackson ter to pay Paul and, depending on your asset allocation. can Red Cross chapter in New
collectibles in the market could lessen • How popular was the person? how the health care initiative im- 3. Don’t cash out. Research York.
their value. • How often did he or she sign au- pacts our company, we might shows nearly half of workers The Pension Rights Center is
“Rare, authenticated pieces, Thriller- tographs? have to get the money from the cash out their 401(k) plans concerned that retirement bene-
era autographs, video-worn costumes • Are these items associated with 401(k) match.” when they leave a job. You will fits may become a casualty of the
and personal mementos will always be the person’s peak of his or her fame? For companies thinking about forfeit 20 percent or more of recession as companies look to
prized,” he said. Have they been authenticated? tying the match to profitability, the account value in federal permanently reduce costs.
No matter what you’re collecting, simply committing to contribut- taxes and you may be subject “Unfortunately, we’ve seen this
TOYS
there are some overall rules of thumb to ing more to the match in good to 10 percent in early with- trend over the past 20 years where
follow. • Are they in pristine condition, in years and less in bad years is the drawal penalties. — ASSOCIATED companies are increasingly get-
Perhaps most important: Educate their original sealed boxes? most flexible option. Another is to PRESS ting out of contributing to their
yourself about the collectible. • How deeply do they evoke long- promise a certain level of match if employees’ long-term well-being
“In the 20-plus years I have been work- held childhood memories? the company hits specified profit plan, whether it’s a pension or re-
ing with collectors, I’ve observed that al- Source: Dallas Morning News targets. said. “If we don’t meet that level, tirement income or health bene-
most without exception, the most suc- That’s what cell phone compa- there won’t be any contributions fits,” said Nancy Hwa, the center’s
cessful people are those who truly im- ny Sprint Nextel has chosen to do. for this year.” spokeswoman.
mersed themselves into their chosen take that into account. The Overland Park, Kan.-based Sprint Nextel had been match- So, why are companies chang-
field,” said Imhof, who collects fine For example, David Widener, a collec- company suspended its 401(k) ing dollar-for-dollar an employ- ing directions now? They’ve
wines and Olympics memorabilia. tor in Waco, said that with sports cards, match as of March in a broader ee’s contribution up to 4 percent reaped the savings, why not re-
“They read everything they can about “I recommend buying vintage cards over cost-savings plan. of pay. store the match once profitability
their area of interest, attend trade shows, the modern and current products” un- Spokesman James Fisher said Depending on what your com- returns? It appears one lasting ef-
develop business and social relation- less there is a limited supply of the cur- the company will make future pany decides, you might see a fect of this deep recession is that
ships with experts and dealers and es- rent product.” contributions on a profit-sharing smaller match. In exchange, the it’s changed the mindset of many
sentially become world-class experts in In other words, the scarcity of an item basis. company might put some of the business executives, said Ritter.
their own right.” is a key component of value. But make “If our performance is above ‘X’ money into a health savings ac- “People realize that the floor
Realize that every collectible item will sure that scarcity comes with demand, level, a specified amount of mon- count, workplace improvements, can fall out from under them now
have distinctive characteristics, and your because the two don’t always go hand in ey from the extra performance or education and development and they want to stay loose,” he
criteria for judging its value will have to hand. will go into the 401(k) match,” he programs. said.