Figuring Bequest Amount for Inherited Horse

[Jarpur]

How do others figure out an amount to set aside for the care of an aged horse that will be left in the care of another, if the owners die before the horse? Multiply current expenses by X number of years? Any rule of thumb?

This particular horse has already lived longer than the other close members of his family, so may lack the genetics to make it to Methuselah status. Want to be fair, of course, but can’t leave a six figure trust fund for him. When a long-time friend asked me to take her OTTB, if need be, she named me as the beneficiary of a life insurance policy to help cover her horse’s expenses (he died, however, and I never took charge of him). We’d leave a cash disbursement from our estate, instead.

Have already communicated that I don’t want the horse to be put through major interventions at his advanced age (such as colic surgery). Looking to fund good, basic senior horsekeeping, allow for the occasional unexpected expense, and cover future euthanasia when necessary. This person (a good friend and neighbor) already uses the same veterinarian, farrier, dentist, etc., provides the same standard of care that we do, is experienced with oldies, and would keep the horse at home.

What financial arrangements have others made in similar circumstances?

[endlessclimb]

This may not work in every situation, but here’s how mine is written.

I require the sale of my truck and trailer (no use in family trying to be sentimentally attached to that sort of stuff), and the proceeds are to be used to take care of the Old Man, and to send whatever young one I have to a sales barn to be trained and sold (I have a horsey friend who would work out the logisitics of this).

The amount the truck and trailer are worth are MORE than enough to cover this. Anything remaining goes to my nephews.

[clanter]

Gunther VI, a German Shepherd, has a net worth of over $400 million. Gunther’s fortune comes from the late German Countess Karlotta Leibenstein, who left her entire estate to her dog to ensure its wellbeing after her death

My wife and I have it in our wills that any livestock remaining (which appears there will be bunch since none ever seem to want to die) are to be maintained at our place until their demise. The estate has the funds to properly care for these animals under the oversight of the estate executor but we have nothing like what Gunther got.

[GraceLikeRain]

I’d start tracking your annual expenses if you aren’t already. Take that plus the average board in your area, add 5% for inflation, and then one major unexpected bigger bill a year. I’d guess that would be anywhere from a $12,000-20,000 a year depending on COL, needs of the horse, and desired level of care. Even if a friend says he can live bareback in her backyard I’d budget for full care, four shoes, expensive meds, etc.

I would imagine that you can have it set up so any unreleased funds go to a charity of choice.

[GraceLikeRain]

@clanter

Gunther VI, a German Shepherd, has a net worth of over $400 million. Gunther’s fortune comes from the late German Countess Karlotta Leibenstein, who left her entire estate to her dog to ensure its wellbeing after her death

A fun story but not actually a true one https://www.townandcountrymag.com/leisure/arts-and-culture/a42574833/gunthers-millions-neflix-karlotta-leibenstein-true-story/

[EventingMaff]

I have this in two ways, one for our dog and one for my horse:

• Dog: Has a specific person who inherits ownership, and along with the dog comes $5k + (15yrs - current age dog)*($2k) with a minimum transfer of $10k even if the dog is 13-15 yrs old. This should more than cover costs and leave some left over for the inheritor for their own use.
• Horse: Has a specific person who inherits responsibility for dispersing funds and making decisions on the horse (but our trust retains ownership and all funds remain in the trust). The trust sets a maximum of 2 years worth of costs that can be spent on the horse and it is the responsibility of the inheritor to sell / euthanize the horse. They are allowed to buy the horse from the trust for $1 if they want to but no funds come with the horse. The funds are purely there to cover costs while the decision is made and executed against on what to do with the horse.

Part of this set up is because 1) Horse is young, worth something, and likely to have a soft landing 2) I am young and my death would be unexpected so we’re planning for a high degree of uncertainty within the situation 3) I have a trusted friend who has agreed to take on this equine-placement responsibility AND she is named to receive a fixed ‘thank you’ fee out of the trust separate from the horse.

ETA: We also have two young children, so in setting amounts we tried to balance ensuring that inheritors of animals are not financially burdened by the animal (aka all costs covered) BUT that majority of our funds stay in the trust to be used in raising and supporting early adulthood of our children. Plus both ‘inheritors’ of the animals are financially comfortable. If children weren’t in the picture, we’d be giving significantly more generously to animal inheritors…but we have to prioritize our young children and their guardians.

[EventingMaff]

TO speak to your question about an aged horse, it likely fits in more similarly to the approach we used with our dog where it’s less about ‘managing’ the animals’ future and more about caring for the animal for the remainder of its life. I would ensure any arrangement:

• Covers anticipated costs of the horse, with generous buffer built in
• Compensates the inheritor for taking on this responsibility, with a minimum amount that is not impacted by or tied in anyway to the money set aside for costs of horse care

[Jarpur]

@EventingMaff

o the approach we used with our dog where it’s less about ‘managing’ the animals’ future and more about caring for the animal for the remainder of its life

This is our primary concern. Thanks for your input.

You’ve made very thoughtful arrangements for your situation.