Ways to Provide Money to Care for Your Beloved Pet
As of 2023, 66 percent of US households own a pet.1 A Forbes Advisor survey of more than
5,000 dog owners found that 41 percent of dog owners spend between $500 and $1,999 a year
on their dogs and 8 percent spend more than $2,000 annually.2 In addition to the annual cost of
care, there is always the potential for emergency veterinary care, which can be costly. As a pet
owner, you may have concerns about what would happen to your pet if you die or were unable
to make decisions or care for your pet. There are several options to ensure that money will be
available so your beloved furry family member will continue to receive the same level of care
and support that you have always given them.
You will want to evaluate the weekly, monthly, and annual costs associated with your pet's
needs. This process will help you determine a specific amount required to cover your pet's
anticipated lifetime expenses.
Lump Sum to the Caregiver
One option to financially provide for your pet is to give a lump sum to the person you choose to
care for your pet at your death. This option is the easiest to carry out and does not involve any
ongoing administration or oversight. However, because the money goes directly to the
caregiver, there will be no one monitoring the use of the funds. You must trust that the caregiver
will use the funds for the pet's benefit.
Pet Trust With the Caretaker as the Trustee
This approach to planning for a pet is a little more complicated than just giving money to the
caregiver. In this scenario, money would be set aside in a trust specifically to care for your pet.
There may be administrative requirements that the caretaker, as trustee, must do, such as
submitting an accounting of the trust's income and expenses to a specified person. Despite
these requirements, this approach does provide some flexibility because the caregiver and the
trustee are the same person, meaning that a third party does not have to be consulted before
expenses are paid or the caregiver is reimbursed for out-of-pocket costs. It is important to note
that with one person serving in both roles, there is still a risk that funds may not be spent
appropriately on the pet without oversight by a third party.
Pet Trust With Separate Parties Serving as Caretaker and Trustee
The final option provides the maximum protection for the money set aside for the pet. The pet
trust will contain funds to care for the pet, but the caretaker will need to work with the trustee to
gain access to the funds in the trust. The trustee can ensure that the money is being used for
the pet. This may be a wise option if you have animals that cost a lot to care for such as horses
or exotic animals, because the amount necessary to care for them could be more than you feel
comfortable handing over to someone without any oversight.
Make Sure Your Plan Stays Up-to-Date
By proactively planning for your pets, you can ensure that they are cared for and supported if
you cannot do so yourself. If you already have an estate plan that provides for your pet, an
annual review of your estate planning documents can address changes in circumstances, such
as acquiring additional pets, an increase in your pet's needs, the designated caregiver's
situation, or your finances.
We can also help you create the appropriate legal documents that meet your state's applicable
laws and regulations. Peace of mind comes from knowing that your pet will transition to their
caregiver smoothly, with as little disruption to their routine and environment as possible. Taking
care of your loved ones' futures, including your pets, is priceless. If you are interested in
providing for your pet through your estate plan, please reach out to our office to schedule an
appointment.
MEREDITH | PC
4325 Windsor Centre Trail
Suite 400
Flower Mound Texas 75028
214-513-1013
This newsletter is for informational purposes only and is not intended to be construed as written advice about a Federal tax matter. Readers should consult with their own professional Counselors to evaluate or pursue tax, accounting, financial, or legal planning strategies.
You have received this newsletter because I believe you will find its content valuable. Please feel free to Contact Me if you have any questions about this or any matters relating to estate planning.
