Pets hold a special place in our lives, becoming cherished members of our families. As responsible pet owners, we strive to provide the best care for them throughout their lives. However, what happens to our beloved companions when we're no longer able to care for them? This is where the concept of a pet trust comes into play when you are creating or updating your estate planning documents.
A pet trust is a legal arrangement that allows you to ensure the ongoing well-being and financial support of your pets even after your passing. The most common way that you will hear about a pet trust is when you hear that a celebrity has died and they have created a trust for their pet. One of the most famous pet trusts in recent memory was the $12 million trust left behind by Leona Helmsley for her dog Trouble. When a celebrity leaves behind a pet trust, it's good fodder for the tabloids and news sites. But even if you don't have $12 million lying around to leave for your pet, a pet trust may be an important part of your estate plan to leave a legacy for your pets.
Even if you aren't leaving behind millions of dollars or a house for your pet, it's important that you make sure you've got some component for the care of your pets in your estate plan.
Understanding Pet Trusts
A pet trust is an estate-planning tool designed to provide financial resources and care instructions for your pets after you pass away. Similar to other trusts, a pet trust involves creating a legal arrangement and appointing a trustee who will manage the trust according to your wishes. By setting up a pet trust, you can ensure that your pets are cared for by a designated caregiver and that adequate funds are available for their well-being.
Establishing a Pet Trust
Setting up a pet trust doesn't have to be a daunting task. In fact, it can be incorporated into your existing estate planning documents, such as a revocable living trust or a will. By including a pet provision in your estate planning documents, you can outline specific instructions regarding your pets' care and the allocation of funds for their expenses. It is important to consult with an estate planning attorney to ensure that your pet trust is legally sound and aligns with your intentions. Downloading a random form from a mail-merging website may entirely defeat your plan to leave a legacy for your pet.
How Does a Pet Trust Work?
When establishing a pet trust, you become the grantor, while the trustee assumes responsibility for managing the trust. The pet trust can hold assets, typically cash, that the trustee utilizes to cover the care expenses for your pets. As the grantor, you can provide detailed instructions regarding your pets' care, such as their preferred food, veterinarian, and grooming routines. The trustee is legally obligated to act in accordance with the instructions you have set in the trust terms.
Choosing a Caregiver and Location for Your Pets
One crucial decision in creating a pet trust is determining the caregiver and the location where your pets will reside. You can designate a trusted individual or organization as the caregiver for your pets. It's essential to consider factors such as the caregiver's ability to provide suitable care, their relationship with your pets, and their willingness to assume responsibility. Additionally, you may explore options like "No Kill" shelters or specific shelters in other states that align with your preferences. However, it's important to be aware that shelters often charge fees and may require a bequest in your estate planning documents to assist with your pet's care.
Financial Considerations
When establishing a pet trust, it's crucial to consider the financial aspects involved. You should estimate the expected costs of caring for your pets, including food, medical expenses, grooming, and other necessities. By analyzing your yearly expenses, you can determine an appropriate amount of money to leave behind for the caregiver's support.
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These are just a few of the initial considerations when you are asking why you should create a pet trust.
Do You Need an Estate Planning Attorney?
If you or your family have a pet that you want to make sure is in your estate plan, let's schedule a Legal Strategy Session online or by calling my Edina, Minnesota office at (612) 294-6982 or my New York City office at (646) 847-3560. My office will be happy to find a convenient time for us to have a phone call to review the best options and next steps for you to work with an estate planning attorney to get your plan prepared and implemented.
