A friend of the firm and attorney, Nick Livers, is doing a guest post for us. A lot of us have pets that we love, but what happens to them after you die? How can you provide for them? Let’s see what Nick has to say:
When my grandma passed away a number of years ago, there was talk among the family about who would take care of her dog. My grandma was a meticulous person, but the one thing she did not plan for upon her death was who would care for her dog. I do not recall what decision was made, but I do remember that there were very few family members who wanted or needed another pet. Since that time, I have had a number of conversations with clients about establishing a trust for their pet to provide funds to care for the pet after their death. A pet trust has the benefit of giving the pet owner peace of mind in knowing their pet will be cared for after their death and giving the person who agrees to take care of the pet resources to do so.
When thinking about estate planning and financial planning, people are primarily concerned with having enough assets to live comfortably during their lifetime, and about who will receive assets remaining at the time of their death. While these topics must be the center of conversations regarding estate planning, it is also important to give thought about who will care for a pet at the time of a person’s death. Adequate funds should be paid into the Trust to provide for the needs of that pet for the remainder of the pet’s life.
A number of years ago, the State of Arkansas passed a statute permitting a person to establish a trust to provide funds to care for an animal that the person owned during their lifetime. To create a trust for a pet, a person needs to name a Trustee. The Trustee will be the person that one selects to care for his or her pets after death. In addition to naming a Trustee, a person needs to fund the Trust will adequate funds to care for the pet during the pet’s life. This can be done by leaving a specified sum of money to the Trustee under a person’s Will or Trust. For example, a person may direct that upon his or her death, a sum of $10,000.00 will be paid to a Trustee to be used for the care of the pet. Finally, upon the death of the pet, the Trust will terminate. Upon the termination of the Trust, the remainder of the assets can be paid to a person or charitable organization. For example, the remaining funds may be paid to the Trustee to compensate the trustee for caring for the pet, or may be paid to a charitable organization such as the Humane Society or other organization that cares for animals.
A pet trust is easy to establish when a person is making his or her Will or Trust. Such a trust will give the pet owner peace of mind knowing that their pet will be cared for after their death and will make sure that the pet will not be a financial burden on anyone after the owner’s death. Anyone with a pet should consider incorporating a pet trust into their estate plan for these reasons.