Have you included pet(s) in your financial plan yet?


One night in March this year, our nine-month-old puppy was enjoying his favorite treat-beef trachea. All of a sudden, he started licking his lips and pacing up and down, unsettled. It turned out that he swallowed a big piece of the trachea without chewing it sufficiently, and the piece blocked his esophagus. We took him to an animal clinic that can perform an endoscopic procedure to get the trachea out. With pet health insurance, the whole procedure would cost us only several hundred dollars. Without pet insurance, however, it would set us back several thousand dollars. The surgery was successful. Now, my puppy has fully recovered. He is sleeping sound and well as I am writing this article.

Americans are pet lovers. More than 80% of Americans regard pets as their family members. Sadly, sometimes pets suffer from their owners’ lack of forethought and planning. We see dogs and cats not getting proper care or medical treatments because of financial trade-offs. We see dogs become homeless after their owners’ deaths. Therefore, a little planning before hand can prevent heartbreaking situations for our pets.

Pet Insurances

Before adopting a pet, think about the time and money you can commit. Do you have to alter your current lifestyle a little bit or a lot? Are you willing to change? What about the financial consequences? Take, for example, the case of owning a dog. Some breeds of dog could incur a large amount of medical bills down the road. One way to mitigate the financial burden is to buy pet insurance. Do a cost/benefit analysis. Does it make sense to buy pet health insurance in your individual situation? Many pet insurances only cover cats and dogs, but a couple of insurers will also cover birds and reptiles. Before you purchase health insurance for your pet, be sure you understand what covered and excluded conditions are and how you file an insurance claim. Many pet insurance companies put their sample insurance policies on their websites. Locate these policies and read them carefully.

Setting Up Companion Animal (Pet) Trusts

Our pets bring us joys and companionship, but they also depend on us for continuous care. How to provide such care in case we are not able to? Pet trust can be a valuable tool for pet owners to do so. So far, all 50 states of the U.S have passed laws allowing pet owners to set up trusts for their companion pets. While considering setting up a trust for your pet, it is a good practice to designate different parties as caregiver of your pet and trustee that administer the funds in the trust for pet respectively.

Alternatively, pet owners can opt for a pet protection agreement, which is simpler than setting up pet trusts, to protect their pets. With a pet protection agreement, pet owners can name their pets’ guardians, leaving funds, and providing instructions for how to care for your pets when you are not around.

Talk to your advisor or lawyer about how to include pets in your financial plan. Don’t let our four-legged family members suffer from the consequences of our lack of planning.