You probably weren’t thinking about your last moments on earth when you adopted your pet, but time marches on and we may not always be available to care for our furry little friends. In the event you die before Fido, do you have a plan for his care?
You might want your sister to care for your pet dog if you die or become incapacitated, but being the caretaker of an animal can represent a significant financial burden — especially if you want Fido to continue getting good medical care. This where a pet trust can help.
Pet trusts are usually classified as “inter vivos” trusts or “testamentary” trusts. An inter vivos trust goes into effect in the event of your incapacitation — like if you need to go to a nursing home and can’t bring your animal with you. A testamentary trust goes into effect after you have died.
When you create a pet trust, you will fund it with a certain amount of money while providing specific instructions as to how that money is to be used for the care for your pet. To ensure that the person caring for your pet uses the trust money as you intended it, you may want to appoint a different person — who will not be caring for your pet directly — to serve as trustee of the trust. This way, there can be some oversight and accountability with regard to how the money is to be used.
Pet trusts need to be carefully drafted in a way that conforms with California law. Otherwise, a pet trust could become nullified. For example, a court could determine that it was overfunded.
If someone left $50,000 to care for an animal, and a judge deems that it’s too much, the money in the trust could be reduced and the funds might go to a different beneficiary. A California estate planning lawyer can guide you through the pet trust creation process to ensure that your trust will withstand being challenged in court.
Source: Investopedia, “Pet Trusts: Care For Your Pet After You’re Dead,” Lisa Smith, accessed July 21, 2017