Should I add my pet to my estate plan? The first rule is that you can’t leave money to your pet. Unfortunately, the law says that animals are property, and one piece of property can’t own another. Yahoo’s recent article, “3 Ways to Ensure Your Pet Is Cared For After You Die,” explains that a pet trust is a trust that provides money and care for your pets when you can no longer do so. People usually create a pet trust as part of their estate planning. However, in some cases, it can also be helpful during your lifetime if you become incapacitated or unable to care for your pet.
Like all trusts, a pet trust is a legal entity that owns property, money and other assets. You fund the trust by contributing assets to it during your lifetime and leaving assets to the trust in your will. Your pet is the beneficiary of this trust. Once the trust is activated, a trustee will use its funds to pay for your pet’s food, housing and other care. In most cases, this means someone has taken possession of your pet, and the trust reimburses their costs.
If you want to ensure that your pet is well cared for after you die, most experienced estate planning attorneys consider a pet trust better than a will. Pet trusts are more specific than leaving your pet and some money to an heir. A trustee must be sure this money really is spent on your pet’s well-being. They can also find a new home for your pet, if your heir changes their mind and chooses not to inherit the animal.
A pet trust does two main things. First, it provides the resources to care for your pets and other animals once you no longer can. Second, it provides the instructions to make sure those pets are cared for the right way.
Funding a pet trust can be an issue for some, and if you leave too little money in the trust, it will run out during your pet’s lifetime. If that happens, the trust will end, and state law will govern what happens to your pet. If you leave too much money, your family may challenge the trust. While that’s pretty rare, courts will reduce excessive funds left to a pet trust.
Don’t just assume that someone will assume the role of trustee. And don’t assume that someone will want to take possession of your pet. Ask the people you intend to name for those positions. If someone you trust wants to take your pet after you die, you can name them as both caretaker and trustee. Otherwise, you may want to name a professional trustee, such as a lawyer or banker, to oversee the trust. If you do name a professional trustee, make sure to contribute enough money to cover their costs, as they will bill the trust for their time.
If your pet has any specific needs, detail these in the trust. However, be careful not to get too specific, or people may disregard your instructions, creating issues. Yes, Beck & Lenox does pet trusts so if you want to add your pet to your estate plan, contact us to discuss the specifics. Schedule a free phone consultation here.
Reference: Yahoo (Aug. 21, 2022) “3 Ways to Ensure Your Pet Is Cared For After You Die”