Pet trusts for the rich are the wave of the future as furry family members expand their financial and emotional footprint without a compensating step up in terms of legal status or protection. Britney’s barely controlled dog budget is practically begging for someone to structure the costs to keep them comfortable for life.
Onetime child star Britney Spears’ five dogs live better a lot of human families -- and should anything happen to her, their golden meal ticket would get mighty precarious.
If Britney or any HNW animal lover wants to protect the “babies,” a pet trust is really the only peace of mind available.
And the way American society is evolving, we’re going to need a whole lot of pet trusts.
While the gossip feeds have overstated the numbers, it’s clear that Britney’s dogs provides a unique window into how much modern pet pampering can cost.
All in all, she spends about $30,000 a year on her dog pack, with that budget item ramping up hundreds of dollars month to month. That’s enough to support over 100 typical American pets.
A single haircut for one of these dogs would feed an average animal for a year.
Granted, even that “average” pet spend has surged 73% across the last decade, making premium dog food and cat pills a significantly better investment than the S&P 500.
But even a real animal lover really has to work hard to spend what Britney does on young, healthy dogs. They’ll live out their lives in world-class luxury.
If anything happens to her, they’re also vanishingly unlikely to sustain that lifestyle of high-end food, endless treats and toys that would make millionaire children envious.
After all, they aren’t actually kids. Guardianship and custody arrangements aren’t binding when the “pet parent” dies. While Britney’s will could simply bequeath the dogs to a friend or relative, there’s scant guarantee that they’d keep the love flowing.
That’s where the pet trust comes in. Much like a trust for human beneficiaries, the objective here is to create a structure that can continue after the original “pet parent” dies.
These trusts generally operate on a revocable basis, with the money transferring into the trustee’s control in the event of death or disability.
A good pet trust will provide for the appointment of successor trustees and designated caretakers for the animals. While this won’t always be a concern -- the humans will usually outlive even puppies and kittens -- it’s always good to cover all bases just in case.
After all, Britney’s only 35 so she’ll probably survive everyone in her current dog pack. But this is about risk management.
To make sure nobody gets left out, she’ll also want to define the beneficiaries as all her pets when she dies.
Dogs aren’t likely to outlive the trust wherever it’s set up, but jurisdiction is important in case your clients are deeply attached to horses, birds or reptiles that can live for several decades.
New Jersey, Michigan, Montana and otherwise top-tier trust haven Alaska will terminate the trust after 21 years, even if one or more of the animals are still alive.
Otherwise, Britney’s pets would continue to enjoy the lifestyle to which they have become accustomed until the money runs out.
Figure at maximum dogs can live 30 years and the grantor dies a day after adopting a newborn puppy, Britney-style luxury would burn about $1 million by the time the trust term ends.
She can afford it. She’s worth at least $32 million on paper and as long as she leaves 3% of that cash behind to a trust, her menagerie will be covered.
Caretakers and conservators
Of course there’s a hidden irony in Britney’s situation because she’d need to go to her father to approve any significant change to her estate plan.
That’s why we know so much about her finances and why so many people confuse the money Britney spends on the pets and the $8 million a year her father -- the legal conservator since her 2008 breakdown -- invests in her continued health and happiness.
She’s easily grossing $30-$60 million in Vegas so the family can definitely afford the lifestyle. But like a trust fund beneficiary, she doesn’t make any decisions beyond where to spend her allowance.
That may be part of why she’s so lavish with the dogs. With her human kids growing up outside her custody except for occasional visits, spoiling and disciplining the pets is the next best thing.
We really don’t know what Britney’s father has set up in terms of an estate plan for his grandchildren. Maybe he loves the dogs enough to divert $1 million or so from the kids’ inheritance.
It’s not Britney’s call. But most wealthy people can set their own priorities.
Odds are extremely good that even your most pet-devoted clients aren’t spending $30,000 a year on their dogs and cats. The size of a normal pet trust will probably be relatively modest.
If they have the ability and the desire to leave the animals that much cash, it might be time to talk about starting with a trust for the pets and then rolling any remaining assets into a separate charitable fund after they’re gone.
After all, pets don’t carry on the family line. For that, you need a little more institutional heft.
Will pet trusts crowd out traditional animal welfare charities? If the assets are structured right, your clients can get both. Britney Spears may end up with neither.
But she’s got her furry babies now, and that’s got to be some comfort.