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Our neighbor has two toy breed dogs and an invisible fence. One of the dogs broke through one day and tried to cross the street to get to us as we were walking by. The invisible fence hasn't worked on him since. I wouldn't have it for our labs because they're notorious for breaking through them. After seeing that little guy break it, I would never use one.

If you do get a physical fence, bury the bottom few inches if at all possible. It will discourage diggers on both sides.