Estate planning isn’t just for people – it’s for pets too. For many people, pets are more than just animals, they are cherished members of the family. This is why it’s important to plan for a pet’s future in the event of the owner’s incapacity or passing. A pet trust is a great estate planning tool to ensure a pet will be cared for according to the owner’s wishes.
What Is a Pet Trust? Why should I set one up?
A pet trust is a legally enforceable estate planning document that allows an individual to set aside funds for the care of their pet in the event of death or incapacity. While some may rely on an informal arrangement to leave money to a friend or family member with the hope that they’ll care for the pet, this type of informal arrangement is not legally enforceable and there is a risk that the funds will not be used for the intended purpose of the pet’s care. A pet trust, by contrast, ensures the owner’s wishes must be followed and the designated funds are used solely for the benefit of the pet.
In Colorado, pet trusts are recognized under state law and may be created as part of a will, a revocable living trust, or as a standalone document.
Appointing a Caregiver and Trustee
There are two different roles that are important to consider in setting up a pet trust:
- The caregiver is the person or organization to take physical custody of the pet and provides day-to-day care.
- The trustee is responsible for managing the trust’s funds and ensuring that the money is used appropriately for your pet’s benefit.
The caregiver and trustee can be the same person, but one may consider listing separate individuals in these roles to provide checks and balances.
Funding and Specific Instructions
With a pet trust, the settlor (the person establishing the trust), determines the amount of money to allocate for the pet’s care. Important factors to consider include:
- The pet’s expected lifespan
- Veterinary care and medical needs
- Grooming and exercise requirements
- Cost of food and supplies
Specific instructions can also be included regarding how the pet should be cared for, such as preferred food brands, exercise routines, grooming needs, and even burial or cremation wishes.
A pet trust can apply to current pets or any future pets. The settlor can also specify what should happen to any remaining funds after the pet passes, such as donating the balance to a charity or to family members.
Summary
Setting up a pet trust provides peace of mind that a pet will be cared for and protected in the event of the owner’s death or incapacity. It provides a legal framework to designate caregivers, allocate funds for the pet’s care, and establish clear guidance and instructions on how the pet should be cared for.
If you’re considering setting up a pet trust as part of your estate plan, contact Mara Peterson.
