The American Institute of CPAs is finding a growing number of pet owners including their cherished pets as part of their estate plan, which could involve their CPAs helping them set up wills and trusts for furry and feathered family members.
The AICPA released the results of a Harris Poll on Wednesday that found of the 73% of pet owners who report having a will or trust, 40% of those individuals have included provisions for their pets.
Among those who have a will or trust but don't have provisions for their pet, they gave several reasons when asked why:
- 40% say they hadn't thought of adding their pet(s) to their will or trust;
- 38% say that their family/friends would figure out what to do with their pet(s) if needed;
- 25% feel that wills/trusts are only meant for people, not animals; and
- 18% say they haven't updated their will/trust since getting their pet(s).
The survey, which was conducted in mid-July by the Harris Poll, also found that 57% of Americans own a dog, 40% of Americans own a cat and 95% of those pet owners consider their pet(s) to be a member of the family. Nearly two-thirds (62%) of American pet owners with a dog or cat have a budget for spending on their pet.
Devotion to pets runs deep, with 69% of pet owners saying they would be more likely to cut spending on themselves than their pets if they had to make cuts. Older pet owners appear to be particularly dedicated to protecting their pets' well-being. Pet owners age 65 and older (81%) are more likely than younger pet owners to say that if they had to make cuts to their spending, they would be more likely to cut spending on themselves than spending on their pets (64% age 18-34, 63% age 35-44, 71% age 45-54, 73% age 55-64).
"These findings show that Americans view pets as a member of the family and that the money spent to care for them is not an afterthought but a core household expense," said Cary Sinnett, director of personal financial planning at the AICPA, in a statement. "For many families, pets provide companionship, emotional support and stability, so it's not surprising that some would prioritize their pets' needs over their own, even during times when budgets are tight."
The AICPA recommended that pet owners create a dedicated pet budget and emergency fund. It noted that the American Veterinary Medical Association reports that pet-owning households spend an average of about $1,515 per year on their pets (excluding adoption or purchase costs). Pet owners should also evaluate pet insurance and review their estate-planning documents, as well as create a pet care plan for emergencies.
"Many people overlook what would happen to their pet(s) if they became incapacitated or pass away," said Erin Itkoe, a member of the AICPA's PFP Champions Task Force, in a statement. "Discussing long-term care arrangements for your pet(s) and documenting those wishes in your estate plan benefits not only your pet(s), but the people you've selected to care for them."
The AICPA has other advice
