A pet trust is an estate planning instrument in which the owner, called the grantor, trustor or settlor, places money or property in trust to be held and managed by another person or institution, called the trustee, to pay for the care and maintenance of the ownerís animals. A pet trust is used when a pet owner wants to leave or set aside funds, in a legally enforceable estate planning document, to ensure his pets receive food, shelter, veterinary care, boarding, and grooming for the remainder of their lives.When you establish a pet trust, you leave your pet and money or property to the trust. You appoint a trustee to manage the trust and pay expenses for your petís care. You also appoint a
or caregiver. The caregiver is to provide shelter, food, and other care for your animals and should be reimbursed by the trustee for these expenses.
How Much Does a Pet Trust Cost?
A good pet trust needs to be incorporated into an overall estate plan that includes other estate planning documents such as a
and a durable power of attorney. Therefore, when considering the cost of a pet trust, you need to take into account whether you have an existing estate plan that needs to be revised to add a pet trust or whether the attorney will be drafting a complete set of new estate planning documents for you and including a pet trust.How much it costs to make a pet trust will also depend on other factors, such as how many animals you have, the general cost of legal services in the area where you live, and the type of attorney you hire. See finding an attorney. Another major factor in how much you have to pay for a pet trust is the other issues involved in your particular estate plan. For example, if you know your heirs will be opposed to the money set aside to care for your pets or if you have other complicated family matters that need to be addressed in your estate plan, those issues will increase the cost. If, however, you have a very straightforward, simple situation, you can expect to pay standard rates for a pet trust.
One way to ensure you are getting the best price for a pet trust is to contact several lawyers and obtain a flat fee quote or fee estimate. While the fees to create a pet trust may seem expensive, it may provide you valuable peace of mind to know your pets will have a home after you are gone.
How to Choose a Pet Guardian and Trustee
In the trust document, you appoint a caregiver or guardian for your pet. The pet trust provides that the caretaker is to be paid for the expenses of caring for your pet out of assets in the trust. The trustee is responsible to manage the assets and disburse them according to the terms of the trust. The caretaker and trustee can be the same person or you can choose different people to serve in each role. The trustee can also be a bank or trust company. However, the fees and costs of a having a bank or trust company serve as trustee can be expensive. It is usually less expensive to have an individual serve as the trustee. For an estimate of how much it will cost, see
trust administration fees.Before choosing a caretaker, discuss the responsibilities of caring for your pets and what you expect. Examine whether the caretaker has a love of pets and try to envision your caretaker adapting his or her lifestyle to include your pets. If the caretaker has never had pets or seems uncomfortable with yours, you may want to consider other options. Your caretaker may believe there is a financial incentive to agree to care for your pets. If the caretaker is in need of money or has a history of financial problems, consider whether he or she would be prudent with the funds you leave behind for the care of your pets. Also, when asked to serve as caretaker, the person may not want to let you down and may agree to care for your pets out of a sense of obligation. If the person you appoint as caretaker does not have a genuine interest in being around animals, consider other estate planning alternatives, such as a pet retirement home.
Name a Successor Trustee and Guardian
To ensure there will always be someone to care for your pets and manage the funds you leave in trust, it is recommended you name successor pet caretakers and successor trustees in your trust document. For example, if your first choice of pet guardian becomes ill, has to move or changes jobs, he or she may no longer be able to care for your pets, despite best intentions.
Name at least two successor caretakers in your pet trust. While it is preferable to name successor caretakers with whom you have a relationship, you can also include the names of no kill animal shelters, sanctuaries or pet retirement homes as successor caretakers. For help finding an organization to name in your pet trust, go to animal charities. Contact the organization first to discuss their policies. It is also recommended you name successor trustees to serve in the event your first choice of trustee cannot continue in that role for any reason.
How to Make a Pet Trust
To make a pet trust, you should contact an estate planning attorney licensed in your state. The laws on using a trust to provide for animals vary from state to state. If you want to make a trust to provide for your pets or other animals in the event you become incapacitated or die, you must make sure the trust, and related estate planning documents such as your will, comply with the laws of the state where you are domiciled. An estate planning attorney can advise you on the steps you need to take to ensure your pets will not be turned over to the pound to be euthanized if something happens to you. For more details on pet trust law, see pet trust information.There are a few different ways to create a pet trust, depending on your specific estate planning goals and applicable state law. It is preferable to create a stand alone trust, or an inter vivos trust, which becomes effective immediately and does not go through probate when you die. One of the advantages of this type of trust is the trustee can also manage the funds and provide for the care of your pet if you become incapacitated or disabled. You can name yourself as the original trustee and name a successor trustee to take over in the event of your incapacity, disability or death.In some cases, a pet trust is created as part of a will. This type of trust is referred to as a testamentary trust. In a testamentary trust, the money or property set aside for the care of the testator's pets first has to pass through probate before it can be used to pay for their care and other expenses. Because probate can take at least six months to more than two years, using a testamentary trust could result in no money being available to care for the pets while the estate is in probate. This could result in pets ending up in a kill shelter and being euthanized. One reason a testamentary trust is sometimes used is it is usually less expensive than creating a stand alone pet trust separate from the testator's will. However, depending on how you have your estate plan prepared, the cost difference may not be that significant and may be outweighed by the advantages of a stand alone pet trust.If you choose to create an inter vivos trust, you should have your other estate planning documents, such as your will, living trust, and financial power of attorney, reviewed as well to make sure the pet trust is drafted in a manner consistent with your overall estate plan. If any changes need to be made to your other estate planning documents to incorporate the pet trust, those changes should be made at the same time.Again, the manner in which your trust should be drafted to provide for your pets will vary depending on where you live. As with many types of law, there are substantial differences in what is enforceable regarding pet trusts from state to state. Unless you consult a lawyer with specific knowledge of pet trusts in your state, the estate planning documents you make for your pet may not be enforced.For information on how to fund a pet trust and what happens to property in the pet trust after your pet passes, see funding pet trusts.
Protect Your Pets From Greedy Heirs
If there is an heir or beneficiary of your estate that may object to you leaving a significant portion of your estate in trust for the welfare of your pets, make your lawyer aware of this when drafting your pet trust. One way such person can try to have your pet trust declared invalid is to claim the amount you left for the pets is excessive. For example, if you leave an amount of money in the pet trust that a court finds to be far greater than necessary to care for your pets throughout their lifetimes, the pet trust could be invalidated.
Be sure the amount you set aside in trust is reasonable and adequate to provide for your petís care, but not so much as to be considered excessive. Your CPA or financial planner can help you calculate a reasonable amount to set aside. An estate planning attorney can assist you in drafting the pet trust in a way that may prevent a challenge by greedy heirs.
Do Not Rely on Verbal Agreements When Making an Estate Plan for Pets
If you leave money in your will to a relative or friend based on a verbal agreement that he or she will use the money to care for your pets, this person is under no legal obligation to honor the promise. Your friend or relative can keep the money and take no responsibility for your pets.
To most pet owners, the thought of your beloved pet being abandoned on the street or left to die is unbearable. But it happens every day. Friends and relatives do not have the same attachment to your pets as you do. If you have a deep care and concern for your pets, there is nothing wrong with being very selective about whom you trust to care for them. To ensure your pets will have a home, food, and someone to care for them when something happens to you, you may want to set up a legally enforceable pet trust.
This article was updated on August 20, 2016.