Wills vs. Trusts
By Jason Wagner | Photography by Kelvin Andow
Estate planning for pets is not something most people think of when getting their affairs in order. However, with more pets in American households and many pet owners considering their animal companions to be members of the family, there is growing number of pet owners who want to plan for their pets’ care in the event of their death.
Making sure her cat has 9 lives
Rochester resident Paula Hardin completed an estate plan that included her 13-year old cat, Bodecea. Paula says her biggest fear is that if she dies, it would be a death sentence for Bodecea.
For Paula—and many other Minnesotans—her pet is like a member of the family. Paula, who lives with multiple sclerosis, says her cats (Sputnik is recently deceased) kept her going when she was suffering from a prolonged flareup of the illness. She says Bodecea gives her unconditional love and something to live for every day.
By including her cat in her estate plan, Paula has honored that relationship and ensured her cat is properly cared for and comforted in its remaining years.
The simplest option for Minnesota pet owners is to remember their pets in their wills. When drafting a will, the owner can identify a good adoptive owner and leave companion animals to that person along with a monetary gift that can be used for the care of the animals.
While this method can be a simple and relatively inexpensive way to include pets in an estate plan, it does have some drawbacks. It can be difficult to find a person who is able to take on more pets, and that person may be unable to care for pets because of age or disability when the time comes. For this reason, it is a good idea to name an alternative adoptive owner.
Even if there is a suitable adoptive owner, there is the concern that the new owner will not care for the pet the same way as the deceased owner would have. Paula, for example, says she would readily pursue procedures needed to improve Bodecea’s quality of life or level of comfort. An adoptive owner may be more hesitant to spend the money, particularly if personal funds are being used. This is where a pet trust can be useful.
Rather than wrestling with who should be named as an adoptive owner and the amount to leave to that person, a pet trust can be an elegant way of striking a balance when including pets in an estate plan. Recently passed (May 2016) Minnesota legislation gives owners this option.
A pet trust works similar to traditional trusts: funds are held and managed by a trustee for the benefit of the beneficiaries. The difference is that instead of children or grandchildren, the beneficiaries are pets, and the funds are paid out to an animal caretaker.
This does add a layer of complexity and cost to an estate plan, but it also adds oversight by involving two different people. Additionally, both the trustee and the caretaker have a fiduciary duty to ensure the pets receive proper care.
When the pet or last surviving pet dies, the remaining funds are distributed according to the owner’s wishes as designated by the trust. Paula finds this reassuring, saying “it can be hard for someone to adopt a cat with health problems, and care can be expensive.”
Preparing to be outlived
Regardless of how pets are included in an estate plan, the owner should create an information packet for the eventual caretaker. The packet can include such things as the type and amount of food a pet eats, medical history, typical “day in the life,” and standards of living. It could also include thoughts on heroic measures and other end-of-life decisions.
With an estimated two-thirds of American households having a pet, owners should realistically consider the possibility that their pets may outlive them. Making plans for that possibility, whether through a will or a trust, ensures pets do not perish or suffer in the event of their owner’s death.
Jason Wagner is an attorney at Ward & Oehler, Ltd. in Rochester. He practices in the areas of estate planning and probate, real estate, business law, and farm law. Jason and his family live in Rochester with their two dogs: Jo, a Pug, and Cinder, a Chihuahua.
Fun Fact: Minnesota was the 50th state to adopt an animal trust law.