Estate Planning for Pets: Ensuring Your Furry Friends’ Future
During the pandemic, Americans adopted more pets than ever, particularly rescue dogs and cats. As many people are now able to work from home, the remote workplace has created the perfect opportunity to train a new pet and create a welcoming environment for their new family members. Pets have become an integral part of our families and, therefore, an integral component to estate planning.
Preplanning Options for Pet Care
Oftentimes, many pet owners outlive their pets, but in some cases, the pet may outlive their owner. Frequently, owners forget to include pet care provisions and wishes regarding ownership after their death in their will or trust. In case you are a part of the group of Americans who will be returning to an office environment by the end of the year, consider a few ways to protect your pets before you leave home and beyond.
There are several preplanning options to think about, including pet care, pet ownership, and funding to your preferred caretaker. Under current South Carolina law, pets are treated as personal property, along with furniture, jewelry, artwork, and cars. If you are leaving any valuables to heirs, you should also have a plan on how to provide financially for the care of your pet. Reason being, if your pet’s welfare is not outlined in a trust, then ownership of your pet can be an issue for probate, potentially leaving your pet’s care to be determined by a Probate judge.
The Importance of Including Pets in Estate Planning
In a perfect situation, you would pre-select who will become your pet’s caretaker, including an alternative option or rescue organization, should a change occur. Funding the care of the pet is the most important component in preplanning. This allows your designated caretaker to receive adequate funds to continue your specified level of care. Some leave a cash amount ranging from $10,000 to $50,000 per pet, and others create a funded option of a “Pet Trust,” through a revocable trust.
A pet trust, as we mentioned earlier, protects the pet from going through the lengthy probate process. The rules for a pet trust (referred to as “trust for care of animal”), is created to provide for the pet and may last during the pet’s remaining lifetime, or, if there is more than one pet, upon the death of the last surviving pet. The amount of cash to be allocated to fund a pet trust should be reasonable to provide enough funds to care for and maintain the pet’s good health but should not be in excess.
South Carolina’s Pet Trust Law
In deciding on the appropriate amount with which to fund the trust, considerations such as the pet’s food, medicine, grooming, exercise, veterinary care, weighed against the age and health of the pet, should be considered. South Carolina’s pet trust law was enacted in 2006, providing protection of care of an animal alive or in gestation during the owner’s lifetime. The trust must also terminate upon the death of the last surviving animal.
Key Components of a Pet Trust
Your pet trust should also include two other key components on what happens upon the death of your pet: remainder funds and disposition. If your pet passes away and there is money remaining, you should think about designating a remainder beneficiary in the event the funds in the pet trust are not exhausted. You may also provide instructions for the final disposition of your pet (i.e., burial or cremation).
If the security of a pet trust is not for you, you can also simply gift the pet in your will (note: the pet will be a part of the probate proceedings), leave a letter of instruction, or have an in-person conversation with your preferred caretaker in advance. Pet trusts offer owners and pet lovers flexibility and peace of mind that their companion will be cared for with thoughtful contingency plans, should anything happen. Additionally, caregivers will be comforted knowing that they can afford and continue the dependent care of someone’s beloved companion.