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Sunday, July 12, 2009 •••

charlotteobserver.com/business

SECTION D

MoneyWiseHE FOUND JOB STABILITY

AS A NURSE

Charlotte man spent his savings,

went without health insurance

to pursue a new career. 3D

DEAL DIVA: Which is cheaper:

grocery stores or Wal-Mart? 3D

TAKING CARE: It’s tough to

search for work if you’re sick. 4D

By Cameron Steele

csteele@charlotteobserver.com

 When Service Corp. International, the nation’s largest

funeral-home chain, bought its biggest competitor in

2006, it took a commanding stake in the Charlotte mar-

ket and promised to provide quality services and reason-

able prices.

But three years later, a new survey shows what con-

sumer advocates at the time feared: Charlotte funeral

prices have risen, making the city the most expensive in

 which to be buried or cremated. According to a June

survey by Everest Funeral, a research company that

 works with consumers and life-insurance companies,

average funerals in Charlotte cost $5,500, while crema-

tions average $2,821.

The figure for funerals is $1,600 more than the South

 Atlantic average and $1,500 more than the national aver-

age, according to the National Funeral Directors Associ-

ation.

Some local independent funeral directors blame the

high prices on Service Corp., a Houston-based company

that owns more than 1,300 funeral homes nationwide,

including 60 percent of the homes in Charlotte.

“It’s called controlling the market, and I hate to say

that it’s working,” said Tito Truesdale, co-owner of Rosa-

dale Funeral Parlor, an independent home on Albemarle

Road in east Charlotte that competes with Service Corp.

Shawn Strickland, Service Corp.’s market manager for

the Charlotte area, says he doesn’t believe the results of 

the survey because he thinks that funerals in big cities

such as New York and Washington cost far more than in

Charlotte. He said Service Corp. offers a wide range of 

prices but that the basic price for a funeral is determined

 by the cost of that home’s overhead.“It’s such a subjective question, because it really de-

pends on the family and what they want to see happen,”

he said. “We don’t have pricing any much different than

anyone else does.”

The president of the local chapter of Funeral Consum-

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

The charts below indicate Service Corp. International’s market share percentage of the national and Charlotte funeralindustries. Service Corp., the nation’s largest funeral-homechain, owns the majority of funeral homes in Charlotte.

Charts: DAVID PUCKETT

Source: Everest Information Services LLC and IBISWorld I nc.

Research: CAMERON STEELE

Service Corp.’s market share

90% Private, family-owned funeral homes

7.8% Service Corp. International

0.1% Stonemore Partners

0.7% Carriage Services Inc.

1.4% Stewart Enterprises

National

30% Private, family-owned funeral homes

10% Keystone Group

60% Service Corp. International

( 6 funeral homes )

Charlotte

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

SEE DEATH, 2D

By Pamela Yip

Dallas Morning News

One day after the death of Michael  Jackson, Heritage Auction Galleries was besieged with calls asking whathis memorabilia is worth.

“The general consensus is that  whatever it was worth yesterday, to-

day, it’s probably worth double, if nottriple,” said Noah Fleisher, spokes-man for Dallas-based Heritage, thelargest collectibles auctioneer in the world.

Collecting is a big business, and it’s become even more so as the recessionhas led many consumers to rummagethrough their attics and basements tosee what can be sold and turnedquickly into cash. Craigslist, for in-stance, has seen its “For Sale/Collect-ibles” section grow 60 percent in thelast year, a Craigslist spokeswomansaid.

But much of collecting has to do  with the emotion someone feels to-  ward a person, object or genre, and

a surge of interest in collectibleslinked to the pop legend. But the tar-nish to Jackson’s image from thestrange turns his life took and the ex-pected litigation over his affairs coulderode the collectibles’ long-term val-ue, industry experts say.

The value of Jackson’s memorabilia

experts say that’s how you should firstapproach collecting.

“A true collector buys items be-cause he or she loves to collect,” not because they’re trying to make a buck,said Todd Imhof, executive vice presi-dent of Heritage and a rare coin ex-pert.

 Jackson’s unexpected death creates

Sales of Jackson items

show power of collectiblesHis memorabilia is red-hot,

and the hobby is big in a

down economy. But be alert

to fads, experts warn.

SEE COLLECTIBLES, 2D

BRYAN CHAN-POOL – GETTY IMAGES FILE PHOTO

Michael Jackson signs autographs for fans as he arrives at his civil trial in

Santa Maria Superior Court in November 2002, in Santa Maria, Calif.

By David Pitt

Associated Press

 As if we needed another sign thatthis may be the Great Recession, itappears some companies that sus-pended their 401(k) match mightnot restore it completely.

In past downturns, most compa-nies that stopped matching employ-ee contributions to 401(k) accountssimply reinstated the match whenthe economy recovered. This time

might be different. Consultants re-port that clients are considering op-tions including tying their 401(k)match to profits or using some of that money for other benefits.

Companies have more flexibilitythan most people think when itcomes to their 401(k) plans.

The current average match is 50cents on the dollar up to 6 percentof pay. For example, a worker earn-ing $50,000 a year contributes 6 per-cent, putting $3,000 into the 401(k)account and the company puts in$1,500.

Using that average figure, compa-nies with more than 15,000 employ-ees can save in the neighborhood of 

$25 million a year by suspendingtheir 401(k) match. When you’retalking that kind of money, it’s easyto see why it becomes a target in badeconomic times.

But potential changes coming

Once they’re gone, 401(k)matches might not returnSome companies look to

redirect former match

money to health care,

training, other benefits.

McCLATCHY-TRIBUNE ILLUSTRATION

SEE RETIREMENT, 2D

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2D Sunday, July 12, 2009 ••• charlotteobserver.com • The Charlotte ObserverBUSINESS

ers Alliance, a nonprofit group that works to educate consumers about fu-neral-service options, said ServiceCorp.’s hold on the Charlotte marketeasily makes the city the priciest forfuneral services.

“I hate that Charlotte is at the top of the list, but I don’t doubt it one bit,”said Mary Brack. The Funeral Con-

sumers Alliance doesn’t have a surveythat compares funeral pricing in dif-ferent cities, but Brack said she’sknown for a while that Charlotte hadto be one of the most expensive.

Local Service Corp. funeral-homeowners offer a variety of explanationsfor Charlotte’s top ranking. They saidcemetery costs and property taxes arerising, and that the move toward less-expensive cremations is forcing uptraditional-funeral prices to maintainrevenue.

Funeral pricing varies, but expertssaid smaller, independent companiestend to be less expensive than largerchains because they have less corpo-rate overhead and don’t have to paydividends to shareholders.

Price shopping When Mamie Stowe knew she was

going lose her husband, Eugene, afterhis two-year battle with cancer, she al-most dreaded the funeral-planningprocess more than his passing. Stowe wanted to honor him with a churchservice. But she was afraid of beinggouged by a funeral home that wantedto be paid upfront and paid a lot.

 After Stowe called around in Junefor quotes that were “ridiculous” andtoo expensive, a social worker helpedher find T.H. Robertson, owner of aprivate funeral and cremation prac-tice by the same name. Robertson isable to cut overhead costs by meetingcustomers in their houses instead of requiring them to come to a funeralhome.

Robertson said his prices, startingat $3,295 for funerals and $1,295 forcremations, are lower than ServiceCorp.’s.

The average price of a Charlotte fu-neral with Service Corp. has risen 10.5percent to about $6,300 from about$5,700 in 2006, another Everest sur-  vey indicates. Nationally, ServiceCorp. funerals cost $5,097, which isabout $1,200 less than the company’sCharlotte prices, according to thecompany’s most recent federal earn-ings reports.

 When Service Corp. bought Alder-  woods Group Inc. in 2006, the U.S.Federal Trade Commission forced itto sell one of the five Charlotte funeralhomes it had acquired. The FTC’s de-cision reduced Service Corp.’s shareof the Charlotte-Gastonia-Monroemarket to 44 percent from 62 percentand attempted to prevent the mergerfrom raising funeral prices. But Serv-ice Corp. still owns six out of 10 Char-lotte funeral homes, and prices haveclimbed in the years since the merger.

Nationally, Service Corp. controlsonly 7.8 percent of the funeral indus-try, with 1, 302 funeral homes and 369cemeteries. The company has its larg-est presence in Charlotte, owningHarry & Bryant Funeral Home, ForestLawn West Funeral and CremationService, all of the McEwen Funeral

Service locations and Wilson Funeraland Cremation Service.

“Charlotte is unique,” said MarkDuffey, president and chief executiveof Everest. “Usually you don’t see thatlevel of consolidation, which is whatmakes (funerals) so expensive there.”

Everest is a national research com-pany that helps clients to compare fu-neral prices and create a customizedfuneral service with the home of theirchoice. Consumers pay $495 for un-limited access to Everest specialistsand research data or get help from thecompany as a life insurance benefitthrough their employers. The surveyis based on a six-month national studythat looked at basic funeral prices of homes in a 10-mile radius of each city.

Brandon Cook, manager of ServiceCorp.-owned Forest Lawn FuneralHome said Charlotte’s high taxes andcost of living escalate the area funeral-home prices. But that still doesn’t ex-plain why Charlotte ranks first on thelist of most expensive cities for funer-als while major cities with compara- ble or higher costs of living rank sig-nificantly lower – Washington is 12th,New York is 15th and Houston is 20th.

Service Corp. funeral managers al-

so point to Charlotte’s high cremationpercentage – 30 percent of Charlotte’sdeceased are cremated – as the reasonfor escalating burial costs. Crema-tions appeal to people everywhere be-cause they’re cheaper, said Cook, butthey are particularly popular in Char-lotte because of its transient popula-tion.

“If people want to be here only for a brief amount of time, they will be ableto take their loved ones with them  when they move,” Cook said. The

shift from high-cost burials to crema-tions threatens revenue for the funer-al industry, which can force overheadprices to go up. But that doesn’t ex-plain why Charlotte outranks all othercities for funeral expenses becausecremations have been on the rise na-tionwide, attributing for 37 percent of the industry.

Financially squeezed families thatare going ahead with burial plans areopting for less formal services. Thatmeans cutting out limousine rides,purchasing less ornate caskets and insome cases putting off tombstonepurchases, funeral industry expertssay.

Antitrust accusations

Service Corp. has run into antitrustaccusations before. In 2005, the Fu-neral Consumers Alliance filed aclass-action suit against Service Corp.and other major players in the death-care industry. The suit alleged thecompanies conspired to overchargecustomers on caskets by suppressingcompetition. While not dismissed, thecase has not gone forward.

In 1999, Service Corp. faced chargesfrom the New York stateattorney gen-eral that the company was dominat-ing the Jewish funeral home businessthere and hurting consumers by rais-ing funeral prices. Service Corp. set-tled out of court, agreeing to sell threeof its Jewish funeral homes and paythe state $1.2 million for the investiga-tion.

Service Corp. also received civil-in-  vestigation demands in 2005 and2006 from the Maryland attorneygeneral about alleged anticompetitivepractices in the funeral industry there.

Barak Richman, a professor at DukeUniversity School of Law, said restric-tions are put on monopolies becausethey can pose harm to market compe-tition.

“When all services in a market aredominated by a single provider, out-put goes down and prices go up,” hesaid. “But if a monopolist chargeshigher prices, that should theoretical-ly allow other people to enter the mar-ket and provide services at a lowercost.”

Strickland said Service Corp. doesnot have a monopoly of the Charlottearea and has continued to meet theneeds of residents during their timesof grief.

“I don’t want to see you come in when you’ve had a death and have tospend a lot of money,” he said. “Wecan customize the service to fit any budget.”— STAFF RESEARCHER MARIA DAVID CONTRIBUTED.

DEATH•  from 1D

DAVIE HINSHAW – dhinshaw@charlotteobserver.com

Charlotte’s T.H. Robertson owns a private funeral and cremation practice

and meets customers in their houses instead of a funeral home to cut costs.

Tips on choosing afuneral home• Ask for a list of general prices.• Ask what is included in thefuneral service fee and what cem-etery costs will add to that fee.• Know that you can negotiate.• Find out whether the home iscorporation-owned or independentand which one offers the type ofservice you need.• Go to different homes around

your area to compare price lists.Go to www.funerals.org for helpfrom nonprofit group, FuneralConsumers Alliance.

Five most expensivecities for funerals

Average cost

Traditional Cremation

1. Charlotte $5,500 $2,821

2. Chicago $5,046 $1,878

3. Nashville $4,983 $1,941

4. Louisville $4,963 $2,138

5. Boston $4,958 $2,311

Source: Everest Funeral survey

  will spike for about a year or two andthen most likely will settle back, Fleishersaid.

“Autographs and items from Michael’sprime will prove to be the most valuedand cherished by fans looking to collect

anything related to the legendary singer,”said Doug Norwine, director of musicand entertainment auctions at Heritage, which will feature Michael Jackson ma-terials in its September auction.

Norwine said collectors should keepin mind that a flood of Michael Jacksoncollectibles in the market could lessentheir value.

“Rare, authenticated pieces, Thriller-era autographs, video-worn costumesand personal mementos will always beprized,” he said.

No matter what you’re collecting,there are some overall rules of thumb tofollow.

Perhaps most important: Educate yourself about the collectible.

“In the 20-plus years I have been work-

ing with collectors, I’ve observed that al-most without exception, the most suc-cessful people are those who truly im-mersed themselves into their chosenfield,” said Imhof, who collects fine wines and Olympics memorabilia.

“They read everything they can abouttheir area of interest, attend trade shows,develop business and social relation-ships with experts and dealers and es-sentially become world-class experts intheir own right.”

Realize that every collectible item willhave distinctive characteristics, and yourcriteria for judging its value will have to

take that into account.For example, David Widener, a collec-

tor in Waco, said that with sports cards,“I recommend buying vintage cards overthe modern and current products” un-less there is a limited supply of the cur-rent product.”

In other words, the scarcity of an itemis a key component of value. But makesure that scarcity comes with demand, because the two don’t always go hand inhand.

COLLECTIBLES•  from 1D

What to look for

 Here are some questions to ask yourself when evaluating whetheritems could be collectibles:

SPORTS ITEMS

• Was there limited production of theitem, such as baseball cards?

• Has the player made it into thesport’s Hall of Fame?• Is it the player’s rookie card?• Has an autograph or sports itembeen authenticated?

POP CULTURE

• How popular was the person?• How often did he or she sign au-tographs?• Are these items associated withthe person’s peak of his or her fame?Have they been authenticated?

TOYS

• Are they in pristine condition, intheir original sealed boxes?• How deeply do they evoke long-held childhood memories?

Source: Dallas Morning News

from Washington have somecompanies in limbo. Many com-panies might not restore the 401(k) match until they find outhow much health care will costthem, said Mark Ritter, an execu-

tive director at business consul-tant Grant Thornton LLP.

“Right now there’s a lot of fearabout what the rules will be and  what’s the cost,” he said. “Thethought is, we may have to rob Pe-ter to pay Paul and, depending onhow the health care initiative im-pacts our company, we mighthave to get the money from the 401(k) match.”

For companies thinking abouttying the match to profitability,simply committing to contribut-ing more to the match in good years and less in bad years is themost flexible option. Another is topromise a certain level of match if the company hits specified profit

targets.That’s what cell phone compa-

ny Sprint Nextel has chosen to do.The Overland Park, Kan.-based

company suspended its 401(k)match as of March in a broadercost-savings plan.

Spokesman James Fisher saidthe company will make futurecontributions on a profit-sharing basis.

“If our performance is above ‘X’level, a specified amount of mon-ey from the extra performance will go into the 401(k) match,” he

said. “If we don’t meet that level,there won’t be any contributionsfor this year.”

Sprint Nextel had been match-ing dollar-for-dollar an employ-ee’s contribution up to 4 percentof pay.

Depending on what your com-pany decides, you might see asmaller match. In exchange, thecompany might put some of themoney into a health savings ac-count, workplace improvements,or education and developmentprograms.

The Pension Rights Center, a Washington-based consumer ad-  vocacy group, said it’s trackingmore than 280 companies withsuspended or reduced retirementplan company matches. A stringof companies began announcingsuspensions or reductions in June2008, and the trend continues.

The list of companies includes

 widely recognized names such asSears Holding Corp., StarbucksCorp. and General Motors Corp.,as well as nonprofits such as Pub-lic Broadcasting Service, the Port-land Art Museum and the Ameri-can Red Cross chapter in New York.

The Pension Rights Center isconcerned that retirement bene-fits may become a casualty of therecession as companies look topermanently reduce costs.

“Unfortunately, we’ve seen thistrend over the past 20 years wherecompanies are increasingly get-ting out of contributing to theiremployees’ long-term well-beingplan, whether it’s a pension or re-

tirement income or health bene-fits,” said Nancy Hwa, the center’sspokeswoman.

So, why are companies chang-ing directions now? They’vereaped the savings, why not re-store the match once profitabilityreturns? It appears one lasting ef-fect of this deep recession is thatit’s changed the mindset of many business executives, said Ritter.

“People realize that the floorcan fall out from under them nowand they want to stay loose,” hesaid.

RETIREMENT• from 1D

No more 401(k)match? Try these tips

Human resources consul-tant Hewitt Associates sug-gests:

1. Save more. The averageemployee can bridge thesavings gap a company 401(k)match suspension creates by

boosting his or her contribu-tion by just 3 percentagepoints a year.

2. Diversify assets. Makesure you diversify your port-folio by regularly rebalancingyour asset allocation.

3. Don’t cash out. Researchshows nearly half of workerscash out their 401(k) planswhen they leave a job. You willforfeit 20 percent or more ofthe account value in federaltaxes and you may be subjectto 10 percent in early with-drawal penalties. — ASSOCIATED

PRESS