Last week, we discussed how Massachusetts residents who care deeply about their pets can create trusts that provide for their furry friends in case they are no longer able to do so themselves.
With May being National Pet Month, we wanted to explore the topic of pet trusts and estate planning a little further.
As we stated in the previous post, while we would like to think that our beloved pets will be taken care of when we are gone, including a pet in an estate plan can help ensure that happens.
However, like we briefly mentioned in the last post, the best way of providing for a pet is through a trust, not a will. That’s because pets technically cannot own property under the law because they are viewed by the law as personal property themselves.
When a pet owner is deciding whether to create a pet trust, the following steps typically need to be taken:
Consult an estate planning lawyer with experience in creating pet trusts. Together, you can decide if a pet trust is necessary for your situation. Pet trusts are most common among people who don’t have a family member or close friend who would be willing and able to care for the pet.
If it is decided that a trust should be created, identify the pet that will benefit from the trust. It’s also important to detail how the pet should be cared for, including the preferred veterinarian or groomer, or how often the pet should get exercise or even treats.
Name a trustee and a caretaker. The trustee will be in charge of overseeing the money in the trust and will have a legal obligation to make sure that the money is spent properly. The caretaker will be charged with caring for the pet.
Next, determine how much money will be needed in the trust to provide care for the pet. Reach this number after considering the age of the pet, its life expectancy and any special care or medical needs it may have.
Finally, determine how any remaining money in the trust should be spent after the pet dies and the trust is terminated. It’s wise to name a remainder beneficiary who will respect the terms of the trust.
Source: Financial Planning, “Estate Planning for Pets: 6 Rules,” Tracy Craig, April 21, 2014
