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When celebrated fashion designer Karl Lagerfeld passed away at 85 in 2019, he allocated a part of his $300 million fortune to his beloved companion, Choupette. The female Burmese cat will likely indulge in the finest meals for the rest of her pampered life.
Lagerfeld wasn't the only one ensuring that a furry companion would be well taken care of after their passing. More and more individuals are making provisions to support their pets after they die. But is it even legal to leave money to an animal?
Legally, the answer is no. 'An animal is considered property under the law,' explains Alice JaKyung Choi, an estate planning lawyer at Novick & Associates in New York City, in an interview with Mytour. While an animal cannot directly inherit property, a person can designate funds in their will for the care of their pet.
Although it is legally possible, this option is generally discouraged by attorneys since there’s no real mechanism in place to ensure that the person caring for the pet will use the funds solely for the pet's welfare.
A more reliable alternative exists. 'If you want to ensure your pet's needs are properly met, setting up a pet trust is highly recommended,' says Choi.
A pet trust provides a system of safeguards that ensures the pet's needs will be properly handled. In a trust, the beneficiary—the pet, whether it's a dog, cat, bird, or other animal—would receive the funds under the supervision of the trustee, who is the designated person in charge of disbursing the money. The trustee would provide the funds to the caregiver, or the person taking care of the pet. The trustee or an appointed enforcer has the legal right to oversee the caretaker and ensure that the funds are used according to the pet’s needs. The testator may also designate a residual beneficiary to inherit any remaining funds after the pet passes away, such as a charity or the caregiver.
Although a trust provides more security than simply bequeathing money in a will, there is still room for misuse. For example, a caregiver could potentially acquire a new pet if the original one dies, allowing them to continue receiving the allocated funds for caring for the animal.
Family members sometimes question the amount allocated to a pet. When the controversial real estate tycoon Leona Helmsley passed away in 2007, she left a $12 million fortune to her Maltese dog, Trouble. Helmsley’s relatives contested this, and a judge eventually reduced Trouble’s inheritance to $2 million.
'If relatives have the legal right to challenge, they can contest the will or trust based on claims such as the testator lacking mental capacity, undue influence, improper execution, fraud, duress, or forgery,' Choi explains. 'It all depends on the specific case.'
Choi estimates that about 10 percent of her clients include provisions for their pets in their estate plans. 'It's not due to a lack of love or care, but because the will or trust typically takes effect years after it is created, unless made while you're seriously ill or elderly. As a result, the specific pet mentioned may no longer be around when the document is executed.'
Pet owners with turtles or birds should probably plan ahead, as these pets could very well outlive their human companions. Choi recommends setting up a trust and appointing a caretaker to ensure that the pet’s needs are met. In some states, a pet trust can be included in a will for as little as $100.
If a pet isn’t mentioned in a will or legal document, it could end up in a shelter. 'If your will doesn't specify anything about your pet, the executor will decide what's in the best interest of the estate, not the pet,' Choi notes. 'A pet trust ensures that the testator’s wishes for the pet are followed and provides the trustee with the authority and funds to carry them out.'
As for who is more likely to leave their pet a significant sum of money, whether dog or cat owners, Choi can only speak from experience. 'Honestly, I believe they are about the same. Though personally, without hard evidence, I lean toward dog owners being more inclined.'
