In our group we just sort of hand wave it. One of out characters has a pet dog, even tho she's a squatter. (We explain it as a stray she feeds sometimes, so it sticks around.) For these kinds of fun, flavorful things that don't impact game play a whole lot, the GM should, imo, support it within reason, (like, someone at low lifestyle with 5 dogs seems a bit much) as it increases players investment in their character, makes the game more fun, and improves role-play opportunities. Plus kidnapping the dog can be a fun plot point to get someone invested in the run.