Estate planning exists to protect the people and things you care about the most, but when you consider wills and trusts, have you accounted for your pets? The reality is that part of being a responsible pet owner is including them in your estate plan through a pet trust.
For many people, pets are members of the family. Many millennials are choosing pets over parenthood, and, therefore, the inclusion of pets in a comprehensive estate plan has become a necessity, regardless of your socioeconomic status. Neglecting to include pets in your plan is detrimental for their future, as they will be treated as property and will be distributed through intestate succession. From a legal perspective, pets are tangible personal property and are categorized the same way your car and other belongings are. Hence, setting up a pet trust will give you peace of mind that your beloved pet will be properly taken care of when you are no longer here.
Every year, between five and seven million pets are abandoned when their owner dies without a plan in place, and, of that, three to four million are euthanized. Though your pets cannot inherit assets, it’s important that you provide adequate arrangements for their future and thereby lower this staggering number.
How to Incorporate Your Pet into Your Plans
No, your dog cannot be named as a beneficiary in your estate plan, but there are steps you can take to ensure the safety of your pet in the event you become incapacitated or die. While you cannot leave money or property to your pet, you can use a will or trust to leave your pet—and money for your pet—to a caretaker.
1. Choose a Caretaker
One option is to leave your pet as an outright gift, meaning that your pet can be left directly with a trusted family member or friend. The drawback to this option is that an outright gift does not outline details for your pet’s care that a caretaker must legally follow. While appointing a friend or family member to take care of your pet when you are no longer here is ideal, it may not always be an option. If that’s the case, talk to your veterinarian or research pet retirement homes in your area. Doing so will ensure your pet’s future safety.
2. Put it in Writing (Through a Will or Letter/Memorandum)
In some states, individuals can create a memorandum for their pets. This is the quickest way to outline what should happen to your pet if you were to pass away. This option is ideal in certain circumstances, for example, if you are having a major surgery and don’t have time to incorporate your pet into your estate plan through a pet trust. You can also include your pet in your will, stating who you will be leaving your pet to and any funds that you hope will go to their care.
3. Consider a Pet Trust
To have the most security and control over your pet’s care after your death, you can set up a pet trust. A pet trust is a legal document that sets aside a sum of money for your pet’s care. In the document, you identify your pet’s name, appoint a caretaker, appoint a trustee, and outline the type of care you want for your pet. The trustee will manage any money you put aside for your pet, as well as keep an eye on your caregiver’s actions. You will also name a remainder beneficiary, who will inherit the remaining funds after your pet’s death.
You can provide a traditional trust for your pet, a statutory pet trust, or create a pet protection agreement depending on the level of care you desire for your pet. Talking to a trust attorney can help determine which option is right for you. In short, a pet trust provides accountability by legally defining your expectations so that no one is able to abuse the terms of the trust or access trust funds fraudulently.
Mistakes to Avoid
Oversights when planning for your pet’s future may result in serious consequences for your pet. It’s important to have an estate planning conversation with caregivers and trustees to confirm their interest in caring for your pet long-term. Additionally, when creating a trust, be sure to choose a trustee who is separate from the caregiver. This will provide a checks and balances system for your plan. If you are leaving a large sum of money, be sure to account for any leftover funds when your pet dies. Lastly, provide detailed care instructions for your pet so that you, the appointed caregiver, and the trustee are all on the same page. By creating a comprehensive plan, you will achieve peace of mind that your pet will be happy, healthy, and safe when you are gone.
Including your pet in your estate plan—especially if they have a longer life expectancy—is a must. Be sure to take into account your pet’s current standard of living, the level of care you expect, your pet’s life expectancy, and whether your pet may develop any serious health issues. Having a thorough plan in place ensures your pet will be taken care of the way you intended. A trust attorney will help you set up these documents and make sure that your pet funds don’t go to waste. Frequently revisiting and revising your estate plan is important, especially if you have recently added a pet to your family.
If you are looking to incorporate your furry friend into your estate plan, contact our offices today.