#48 - Can You Leave Money to Your Pet? The Truth About Pet Trusts and Inheritances
Reluctant Executor News
Raise your hand if you've heard outrageous stories of celebrities leaving millions of dollars to their pets. Some of the most famous are Leona Helmsley leaving $12 million to her Maltese dog, Trouble, or Michael Jackson leaving $2 million to his chimpanzee, Bubbles. There's also the story of German Countess Karlotta Leibenstein's German Shepherd Gunther III, who may be the richest dog in the world. Some say he inherited her full $80 million fortune. But more on that story later.
Pet Inheritances
What actually happens if money is left for a pet in a will? Animals are considered property, so you cannot directly leave money to a pet in a will. If this did make it into a will, the most likely outcome is that the money intended for your pet would instead go your beneficiaries.
However, you are able to leave your pet to someone in your will. You can even leave instructions on how to care for them, but there is no guarantee that these instructions will be followed. And if you leave money to that person with direction to use it for your pet, that may not happen either. Also consider that your pet will need to be cared for immediately, yet a will can take months to go through probate.
A Better Approach - Pet Trusts
How can you ensure that your pet will be cared for in the way that you want? Through a pet trust. Similar to other trusts, a pet trust is an agreement that has legal consequences if the directions are not followed. First, you'll need to think through how you want your pet cared for. Think about types of food, medical checkups, grooming, and any emergencies that may come up. Next, add up the expected expenses for this care. You can leave this amount of money to the Trustee that is designated to care for your pet, for use on your pet care.
Pet trusts can be enforced by someone designated as the enforcer. If they find that the pet is not being cared for property, or the money is being spent on personal use, they can bring legal action against the caregiver. Furthermore, the pet trust terminates upon death of the animal, and any money left over can be directed toward beneficiaries, including charities. This is a good way to help other animals after your pet passes on.
Fact From Fiction
The outrageous stories mentioned earlier all have at least a hint of truth to them, but don't believe everything you read. A judge granted Leona Helmsley's dog, Trouble, only $2 million of the $12 million she left in her will. And German Countess Karlotta Leibenstein never existed. The story was a publicity stunt. You can learn more by watching "Gunther's Millions" on Netflix.
Estate Organization
You may be one of the 94 million households in the US that owns a pet but is not ready to set up a pet trust. That's ok. But at a minimum, you should have a pet care plan in place in case someone else needs to suddenly care for them. This can be as basic as what type of food, how often to feed them, and who their vet is.
When you're ready to capture this and other important information, schedule a call with us.