If you have a pet, you know firsthand the bond that can develop between humans and animals. Many of us consider our pets part of the family. But have you considered what would happen to your furry or feathered companion if something were to happen to you? Over 500k pets are abandoned each year due to the death or disability of their owner. These pets could have been protected with just a little planning.
It is prudent to include your pet in your estate plan for a number of reasons. First, you want to make certain there is someone designated to take care of your pet in case of your death. Second, you want to provide clear instructions for your pet’s care. Third, you want to leave sufficient funds to ensure that your pet receives the best possible care.
Including your pet in your estate plan is a little different than including one of your children. For one thing, pets are not people, so they cannot own property. This means you cannot leave money or property directly to your pet. Another issue that arises when incorporating your pet into your estate plan is that communication becomes an especially high priority. You want to make sure the person you designate to care for your pet after your death wants the job and understands all of the responsibilities that come with the job.
There are two primary methods for ensuring your pet will be well cared for after you are gone:
Outright Gift
One option is to leave your pet, along with a gift of money or property for the care of your pet, directly to a family member or a friend. This is done using your Will or Trust, and the caregiver receives the assets on the condition that they be used for the care of your pet.
This option is simple and straightforward. It works best when you are confident that your chosen caregiver is trustworthy and responsible, and when you have clearly communicated your expectations and the details of your pet’s needs.
The problem with an outright gift for pet planning is that it provides no means for monitoring your pet’s caregiver. It will be difficult to ensure that the assets you leave behind are, in fact, being used to care for your pet. It will also be difficult to ensure that your pet receives the level of care you contemplate.
Pet Trust
Another option is to establish a pet trust. These trusts have a reputation for being reserved for the rich and famous, but they’re actually gaining popularity among average pet owners. Part of the reason for this increasing popularity is that pet trusts allow you to have more control over your pet’s fate after your death.
A pet trust is a written document with which you appoint a caregiver as well as a trustee (the person who will manage the money for your pet’s care and keep an eye on your caregiver’s actions). You use the trust document to specify the standards the caregiver must adhere to, as well as the circumstances under which the trustee will distribute funds to the caregiver.
With a pet trust, as with other trusts, you’ll also name a remainder beneficiary – someone who will inherit the remaining trust funds after the death of your pet.
What if You Can’t Find a Caregiver?
If you don’t have a friend or family member who is willing to take care of your pet in the event of your death, you still have options.
One alternative is to check with your veterinarian. You may be able to use the outright gift option, explained above, to place your pet in their trusted hands. If your veterinarian cannot provide long-term care for your pet, they may be able to place your pet with a local family or work with an adoption agency to find them a loving home.
Another alternative is to look for a pet retirement home in your area. These are relatively new facilities, often operated by veterinary schools, and they can be costly and difficult to locate. However, such facilities are one way to rest assured your pet will be well cared for. The level of care provided by pet retirement homes tends to range from high quality to luxurious.
By: The American Academy of Estate Planning Attorneys
