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Related topics: debt, bills, spending, insurance, Liz Weston

We have one really nice rug in our house: a Turkish wool number that my husband inherited from an aunt.

That is, of course, the rug our new dog decided to eat. The pooch didn't complete his task, but repairing the damage set us back $500.

That sum paled compared with what a relative could have faced in vet bills when her dog developed a series of serious but treatable ailments. The bills topped $16,000. Luckily, she had bought pet insurance right before the first diagnosis, and most of the bills were covered.

Readers had similar stories, and not everyone has pet insurance to cover the costs. Diane Jarvis Powers of Thousand Oaks, Calif., looked into coverage after her dog's first surgery to remove strings from a rope toy that blocked his intestines, but decided the insurance was too expensive and had too many exclusions. Little did she know the dog, a purebred Sheltie adopted from a friend, wasn't done: He then scarfed down T-shirt strips her son had thrown in the trash, requiring another surgery.

"That 'free' dog has cost us $10,000 so far," Powers wrote on my Facebook fan page.

Image: Liz Weston

Liz Weston

Dogs aren't the only animals that cost their owners money. Readers described surgeries to treat horses with colic, cats that required diabetes medication and dental treatments, and even a lizard that received two months of expensive care before it died.

The point is: Pet ownership can be expensive, above and beyond the costs of acquiring, accommodating, feeding and grooming the animal. Bad luck or poor preparation could leave you facing catastrophic bills.

What Americans spend on their pets
  Share of total
Food$18.28 billion38%
Vet care$12.79 billion27%
Supplies/OTC medicine$11.01 billion23%
Grooming, boarding, other services$3.45 billion7%
Live animal purchases$2.21 billion5%
Total$47.74 billion 
Source: American Pet Products Association, 2010

And that's assuming your pet never hurts anyone. A single act of aggression could cost you $25,000 or more. Even owning certain breeds of dogs with a reputation for aggression can mean losing your homeowners insurance.

If owning a pet is important to you -- and believe me, our dog has brought immense joy into our lives, in addition to minor property damage -- then here are some suggestions for how to cope:

  • Do your research. Before you seek out or agree to adopt a pet, make sure you understand the setup and continuing costs in both money and time. This chart from the American Society for the Prevention of Cruelty to Animals outlines the first-year expenses you can expect for various types of animals, ranging from $235 for a fish to more than $1,800 for a large dog. Rescue groups and discussions with other owners of your type of pet can help you understand the time commitment involved. Also, check with your homeowners insurance company to find out if it blacklists any dog breeds. If so, consider other breeds or shop around, since insurers differ considerably in what they will and won't cover.
  • Pet-proof your house. Just as you'd take safety measures before bringing a baby into your home, you'll need to consider hazards to your new pet. That means removing or securing toxic plants, electrical cords, small objects and even clothing (especially underwear, which both dogs and cats will eat). If you have both a dog and a cat, you'll need to figure out a way to prevent the canine from treating the litter box as a candy dish. (Yuck, I know, but what's called coprophagia isn't uncommon with dogs.) Daily vigilance in keeping hazards away is essential.
  • Invest in training -- and diversions. Our dog trainer Paul Owens, a co-author of "The Puppy Whisperer," notes that if you don't keep your dog occupied it will become "self-employed" in positions such as gardener (digging in the yard) or interior decorator (chewing up the furniture). Proper training and appropriate toys can help. Ask friends for referrals to trainers or check with a pet store. Chain pet stores often offer affordable group classes.

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  • Consider pet insurance. Experts are still divided about whether pet insurance is worth the money. Consumer Reports advises setting up a savings account to pay for vet care, but if you're the type of person who would do anything to save your animal, pet insurance can make more sense.

Liz Weston is the Web's most-read personal-finance writer. She is the author of several books, most recently "The 10 Commandments of Money: Survive and Thrive in the New Economy" (find it on Bing). Weston's award-winning columns appear every Monday and Thursday, exclusively on MSN Money. Join the conversation and send in your financial questions on Liz Weston's Facebook fan page.