[music playing] All right.

Hold it, Basil.

Good job.

OK. Now, let's get a brooding one.

What's this?

Oh, Basil's headshots.

Headshots?

Yeah.

I mean, I thought about how much money we put into this little guy.

We don't get anything in return.

Except love and companionship.

There's no reason he shouldn't start pulling his own weight.

So I made a list of all the jobs Basil could do, you know, like sheep dog, guard dog, firefighter.

But I decided on internet celebrity.

Is there money in that?

Are you kidding?

Boo, the Pomeranian, makes a million a year from book deals and endorsements.

And Grumpy Cat's net worth is estimated at over $100 million.

Cool.

We're going to need a couple more fernels in here, maybe a soft box.

How we feeling about costumes?

[music playing] Cats and dogs have been friends with humanity for tens of thousands of years.

And in the early days, the relationship was mutually beneficial.

The animals got a safer life with plenty of scraps to eat in exchange for keeping predators and vermin away from our homes.

Today, it's much more of a one-way street.

Americans spend more than $60 billion a year on our furry friends without getting any obvious financial return on that investment.

And according to one survey, 98% of cat and dog owners significantly underestimated the lifetime cost of their pet.

The majority thought it would be less than $6,500.

And 12% expected to pay less than $650 for the pet's entire life.

These people know that animals need food, right?

So how much does it cost to own a pet?

Well, the ASPCA estimates that the average lifetime cost is around $15,000 for dogs and $12,500 for cats.

And that doesn't even include things like property damage or boarding.

A more expansive study in the UK put the numbers even higher.

That may sound surprising, but it makes sense once you start itemizing.

Take the average owner of a mid-sized dog.

After the initial costs of adoption, spaying, and neutering, and purchases like crates and bowls, he or she can expect outlays for food, medical bills, grooming, toys, and treats that total, on average, about $47.

They'll spend about $500 a year in boarding and dog sitting, and almost $400 a year replacing damaged property, like shoes, sofas, and doors.

That's an annual cost of about $1,460.

If the dog lives an average of 12 years, that's a lifetime cost of about $18,000.

And that doesn't even include any money for emergency medical visits.

Most people considering a new pet probably don't think of it as being as expensive as a new car or a down payment on a house.

Maybe Basil doesn't have what it takes to be a celebrity.

We should have started him earlier.

Well, even if your pet doesn't technically work for it's living, it doesn't mean you aren't getting some kind of financial return on investment.

Like home security-- many people consider dog ownership to be a more effective crime deterrent than burglar alarms, which average $1,000 for installation and $30 a month.

And then there's your health.

Many studies have found a relationship between pet ownership in improved mental and physical well-being.

People who own a dog or cat tend to make fewer visits to the doctor and have lower rates of depression.

Children who grow up with animals in the house tend to have stronger immune systems, making them less susceptible to viruses and allergies.

And seniors who care for pets actually tend to live longer than those who don't.

But that doesn't mean you can't still be cost conscious.

You can save hundreds of dollars right off the bat by adopting an animal, rather than buying one from a pet store or breeder.

Not only are you helping alleviate the widespread problem of animal homelessness, but shelter dogs and cats tend to have fewer health problems.

And if you want animal companionship without the financial commitment, you could possibly volunteer to foster an animal in your home.

Not only will the shelter pay its medical costs, but some of your other expenses may be tax deductible.

Some people purchase health insurance as a way to cut down on medical costs, but most plans will not save you money on routine vet bills, just rare procedures like surgery.

And if you have a purebred dog, many plans will specifically not cover the conditions your breed is prone to.

Philip and I prefer to keep an emergency fund set aside for any unexpected medical costs.

That way, we know we don't have to choose between treatment and staying out of debt.

None of this is to say that you should feel bad about spending money on your pets.

Our pets make us happy, and happiness is a good reason to spend money.

But keeping track of how much you're spending will help you make better financial plans for the whole family.

And in the off-chance your pupper does become an Instagram star, you'll know exactly how much to bill him for, plus interest.

And that's our two cents.

Do you have any interesting stories about spending or saving on your pet?

Share them with us in the comments below.

[music playing]