Pet Insurance and “Bad” Money Choices

When I was thirty, before we had kids, we adopted an 8 or 9 year old beagle named Tobey.

There was a local shelter hosting an event outside of a Petco and we wanted to rescue a dog, so we went. Tobey was a stinky old beagle who immediately leaned up against my shins and we were hooked. He’d join our family about a month later.

This photo was closer to when we adopted him, in 2009
This photo was when we adopted him in 2009

As an older but not yet elderly dog, Tobey was a great companion with enough energy to be fun but not so much to be overwhelming for a first-time dog owner. My wife grew up with terriers but I never had a pet, so caring for one was a new experience. Being able to skip the puppy phase but still teach Tobey new tricks, like play dead, was fun. (yes, you can teach an older dog new tricks)

We didn’t really know how old Tobey was, just a range, because his paperwork gave conflicting information. It didn’t matter to us though.

A recent study from a few years ago by the American Veterinarian Medical Association revealed that 78% of respondents would consider going into debt for their pet, especially if it were a medical emergency. 50% would use a credit card to pay for the crisis and 22% would be willing to spend more than $5,000 for an emergency.

Tobey is no longer with us and I can attest to the fact that we were in the majority. As he aged and there were mounting medical issues, we paid for them. We didn’t even discuss it. Fortunately, we were in a strong financial position and had the means to do so without going into debt. It’s one of the benefits of having dual income and no kids (at the time!).

But there was one decision we made that lessened the burden – we got pet insurance. We got it at a time when he was still able to get it and it excluded some “pre-existing conditions,” such as his frequent ear infections. But it covered a couple larger visits that required significant test and treatments. It made those decisions easier.

The co-payments are large and you still pay a high percentage in co-insurance (I believe ours was 20%), but it does lessen the impact of those hard decisions.

It’s terrible to have to decide between $5,000 and the life of your pet. By getting pet insurance, you pay premiums but you lessen the impact of those big bills. You no longer have to pick between the two – with pet insurance, you are buying peace of mind.

The peace of mind that you won’t have to make that choice of whether what you love more – your pet or a big pile of money. For many, like myself, the premiums were worth it.

There are many products and services like this. You buy them not because they’re optimal but because they improve the quality of your life. If you understand your nature, you make choices that move you in a positive direction without fighting your nature.

Leasing a car is generally regarded as not the best financial move… but if you love having a new car every few years, leasing a car makes sense. It’s better than buying a car, driving it for three years, and then selling it. There’s the financial cost as well as the time spent selling it. Leasing is not financially optimal but it’s better than buying and selling a car every three years.

Taking a gap year or a sabbatical in which you are not earning an income is, by definition, not financially optimal. But the benefits can be immeasurable. If you delay college by a year to spend it backpacking in Europe (a classic trope, I know), you delay income (and the investment gains any savings would’ve accrued) but can have a fantastic life experience that shapes the rest of your life. I have never met someone who took a gap year and regretted it.

In the end, Tobey was put to sleep after a long battle that ended in liver failure. We were never put to the decision as there was nothing we could do. I have no regrets about paying for pet insurance.

Not all the treasures in life are measured in dollars and cents.

Sometimes you’re paying so you don’t have to make an ugly decision.

What do you think? How has this played out in your life?

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About Jim Wang

Jim Wang is a forty-something father of four who is a frequent contributor to Forbes and Vanguard’s Blog. He has also been fortunate to have appeared in the New York Times, Baltimore Sun, Entrepreneur, and Marketplace Money.

Jim has a B.S. in Computer Science and Economics from Carnegie Mellon University, an M.S. in Information Technology – Software Engineering from Carnegie Mellon University, as well as a Masters in Business Administration from Johns Hopkins University. His approach to personal finance is that of an engineer, breaking down complex subjects into bite-sized easily understood concepts that you can use in your daily life.

One of his favorite tools (here’s my treasure chest of tools,, everything I use) is Empower Personal Dashboard, which enables him to manage his finances in just 15-minutes each month. They also offer financial planning, such as a Retirement Planning Tool that can tell you if you’re on track to retire when you want. It’s free.

>> Read more articles by Jim

Opinions expressed here are the author’s alone, not those of any bank or financial institution. This content has not been reviewed, approved or otherwise endorsed by any of these entities.

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