We love our pets and cherish their roles in our lives more than ever during a pandemic. Planning for your pet’s care in the event of your death or incapacity can provide tremendous peace of mind. The most effective way to properly plan for your pet’s ongoing care is to create and fund a pet trust.
A pet trust is a legal instrument that specifies how your pet should be cared for after you pass away or become disabled and it provides the assets needed to fund this care.
Components of a pet trust:
Trustee Designation: In the pet trust you designate a trustee to manage the money in the trust according to your instructions for the benefit of your pet(s).
Caretaker Designation: You also designate a separate pet caretaker who actually takes possession of the pet(s). The trustee and pet caretaker can be the same person or two separate individuals.
Designation of Successors: You may also want to name a successor trustee and successor caretaker in case the person named is not willing or able to serve in those respective roles for the duration of the pet’s life.
Instructions for Care/Use of Funds: Create specific instructions for the type of care your pet needs and how to allocate the funds to provide for that care.
Care of Last Resort Provision: If the trust runs out of money, the trustee/caretaker may choose to continue to provide for the pet from their own funds, but they are under no obligation to do so. It is wise to indicate a ‘care of last resort’ provision that designates alternative care providers should the trust become underfunded and/or the caretaker is no longer willing or able to provide services.
Designation of Remainderman: If the trust is overfunded and there are funds remaining after the pet dies, you should also designate another beneficiary as the trust remainderman. Avoid naming the caretaker as the remainderman beneficiary because it may conflict with their ability to provide the best, and often more expensive, care options.
Once the pet trust is created you will need to fund the trust. Take into consideration the life expectancy of the pet and the amount of money needed to cover food, pet-sitting, veterinary bills and incidentals. Provide the trust with assets as closely to this estimated cost as possible. You want to ensure the caretaker has what he or she needs to sufficiently provide for the pet.
To discuss creating and funding a pet trust to ensure continuity of care for your pets, please contact Stouffer Legal. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at firstname.lastname@example.org.