We should not assume that figurative language indicates actual belief. The Ancient Near Eastern civilizations as whole generally avoided discussing the afterlife because they made no pretense of understanding it. Instead, they relied on a range of confused metaphors to discourage hubris. You couldn’t talk about it literally because it was beyond human understanding. We note with some sadness that there were plenty of folks in that ancient world who did tend to take such language literally, but we need not join them. It’s clear here that the psalmist doesn’t fear the grave, but that those trapped by materialism should fear it.
The psalm opens with a declaration that what follows is universal and applies to all humanity. These are wise words of truth. It will be shared in symbolic language and poetic parables because it deals with something beyond mere intellect. It is moral wisdom for the heart. The subject is fear of those with wealth and political power.
Lots of people are deceived by the apparent power of wealth to buy fleshly comforts and convenience. Pity the wealthy for they have nothing else. No amount of material wealth can purchase eternal life in the beyond, nor can it keep you here where it seems most useful. If the morally competent eventually die, how can fools expect to escape the common fate of men? Rich and poor, wise and fool, they all come into possession of the grave. How’s that for something that can’t be taken from you? Go ahead — use your wealth and power to rename some territory after yourself. You are not your name; you will eventually die like any other beast abiding in that same land. Pity the poor fool who believes in his wealth, for it has no divine power.
For as long as time rolls on, their souls will be in the custody of death. When the Day of Judgment comes, the morally just souls will have full advantage over them. Whatever bodies and property the foolish rich had in this life will be forgotten. Those of us who serve Jehovah with full commitment have nothing to fear from death, because it takes from us only our suffering and sorrow.
Don’t revere the wealthy and powerful of this world. Once this life is over, it means nothing. They might celebrate their wealth here and now, and enjoy the honor of mere men, but they can’t taken any of that with them. Too many people of wealth and power forget they are but animals with extra stuff.