Protecting our most loyal companions

Most of estate planning focuses on protecting and providing for our human family members, but for many people, animal companions are just as loved. What is shocking is the number of people who fail to plan for who will take care of such an important part of the family. I speak from experience here. When I was a newlywed, and shortly after my wife and I adopted two young cats, a family friend’s mother died with a portly dachshund named Peanut. No plans had been made for Peanut, and rather than let her go to a shelter (where she would likely have been put to sleep if no one adopted her), we took her in. Peanut was a wonderful dog, but after a few months, it was clear that she and our cats were not compatible. Nothing would convince them to get along. Thankfully, a coworker did not have cats, and Peanut lived with my old coworker for many happy years.

The news occasionally has stories of large sums going to pets in an estate (one of the most famous being Leona Helmsley’s dog, Trouble), but for most pet owners, the concerns are more day-to-day than headline worthy. When clients do plan for their pets, most are concerned about whether the beloved pet will be properly cared for and who will look out for the pet during its remaining life. 

Both questions should be answered after considerable thought. Taking in a pet can be a considerable expense. If there is a family member or friend who would love the pet as much as the current owner, the choice is easier, and you can focus on whether funds from the estate should be included to offset care costs. If there is not a clear caretaker choice, additional work is required to try to find someone who is worthy of the task and how much should be left to pay for maintenance for the rest of the pet’s life. This is especially important for people who have an animal with a long lifespan, such as a tortoise or parrot. 

In either case, the nagging question is who will ensure the job is done right and funds are used properly? If a considerable sum is left for the pet’s maintenance (e.g. more than $100,000, some of the funds can be used to pay for the watchful eye to make sure the pet is cared for. The use and potential misuse of funds to provide for a pet are where most articles and stories about pet trusts focus their attention. Pet trusts are useful for these larger sums because you have a trustee to properly manage the funds for a pet’s life, a caregiver to receive and use the funds, and a person to make sure the other two are performing their responsibilities.

When a pet owner does not want to or cannot allocate enough resources to support a pet trust, choosing the right caregiver becomes ever more important, and figuring out how to provide for the pet can require creative thinking. For instance, if a pet owner wants to leave funds for the care of a pet but doesn’t want the potential caregiver to take the funds and leave the animal, the owner could condition the gift on accepting responsibility for the pet.

If you have a pet, consider what will happen to your furry, feathery, or scaly companion in your estate plan, and don’t assume family can step up to provide care. Share this article with other pet lovers you know, and get in touch with me if you want help in adding your most loyal companion to your estate plan.

See you on the trail.

Post by Peter Harrison