Your Money: Pet lovers like Helmsley plan ahead

— -- Say this for Leona Helmsley: She loved her dog. Some of her grandchildren? Not so much.

The imperious hotel magnate, who died last month, left $12 million to her white Maltese, Trouble, ensuring that Trouble will continue to enjoy a lifestyle other dogs can only dream of.

Two of her grandchildren, meanwhile, got nothing. The two others got $10 million each, though their inheritance will be cut in half if they fail to visit their father's grave once a year.

If there's an upside to this dysfunctional saga, it's this: Helmsley's excessive bequest has focused attention on the importance of including your pets in your estate plans.

Thousands of pets end up in shelters every year because their owners died without making arrangements for their care, says Kim Bressant-Kibwe, trust and estates counsel for the American Society for the Prevention of Cruelty to Animals.

Animal shelters are "already overburdened as it is," she says. "To the extent that people plan ahead, it helps us, too."

One increasingly popular strategy is to set up a pet trust. A pet trust allows you to designate a specific amount of money for your pet's care and name a trustee to carry out your wishes.

Currently, 38 states and the District of Columbia have enacted laws that let residents set up "statutory pet trusts," which are less expensive than traditional legal trusts (see box). In states that allow statutory pet trusts, you can create one by adding a few lines to your will, instead of setting up a separate trust. You can set up a statutory pet trust for as little as $100, in addition to the cost of your will, says Greg Daugherty, executive editor of Consumer Reports.

If you plan to set up a pet trust, talk to an estate-planning attorney. Ideally, look for one who has handled estate planning for pets. Some factors to consider:

•Who will manage the trust. Most pet trusts designate both a trustee to manage the money and a caretaker to handle the day-to-day care of the pet. You can name the same person as the caretaker and trustee, but that's usually not preferable, Bressant-Kibwe says. Naming two individuals, she says, creates a system of checks and balances. "The trustee can make sure the caregiver is doing what he's supposed to do."