What to Know About Pet Trusts
A little planning will help your customers ensure their pets are looked after.
It’s a fact of life that one day we all will pass. That’s why it’s so important to plan ahead, so our family members are taken care of when we’re gone—even the furry, four-legged ones.
That’s where pet trusts come in.
What is a pet trust?
Like other trusts, which allow you to specify how assets will be handled after your death, a pet trust is a legal arrangement that stipulates how your pet will be cared for upon your passing. Every state—and the District of Columbia—has laws regarding the creation and execution of pet trusts.
Typically, the grantor names a trustee who holds funds in “trust” to benefit the pet for the rest of its natural life. These funds can then be used for things like veterinary visits, emergency care, grooming, food and board.
Who needs a pet trust?
While it’s good for everyone to plan ahead for their estate, the choice to set up a pet trust is very personal. One of the greatest benefits of a trust is the peace of mind that the owner’s wishes for his/her pet will be carried out.
Other factors that should be considered include the pet’s age and life expectancy; their current health and lifestyle; how much it will cost to maintain that lifestyle; and how much an owner can afford to put toward a trust.
How is a pet trust set up?
To establish a pet trust, owners need to talk to an estate planning attorney about drafting the trust paperwork. The document can be as detailed as the owner wants regarding the standard of living they want provided.
Properly identifying the pet using DNA samples, photographs, microchips or other means to prevent fraud is essential. It is also important to provide instructions for what should be done with any leftover funds.