Bauerle Financial: Estate Planning in the Digital Age
Estate planning helps with the transfer of your assets through a trust or a will. In today’s day and age, settling an estate isn’t as straightforward as it used to be. This is due to the fact that most of our assets are digital these days.
Digital estate planning entails organizing, cataloging, and preparing for the disposition of someone’s digital assets after their death. This has become the new norm over the past decade and it is extremely important to have. Even though it is so important, around 50 % of Americans have yet to do this due to a lack of knowledge on how to set it up.
Here are some examples of digital assets.
It is common practice to carry out financial transactions electronically and to hold financial records in your smartphones, laptops, desktops, and even in the cloud. That is why it is now more important than ever to take the necessary steps to get your digital assets to the beneficiary that you choose. Criminal and data privacy laws, data encryption, and password chains are some of the safeguards that may make it difficult for anyone other than yourself to access your personal digital assets. That is why proper planning is so crucial to leaving a lasting legacy the way you see fit.
Some simple questions that might help you prepare to organize your digital assets are as follows: What digital assets do I have? What important information is needed to access these assets? Which asset should be given to whom? How can I secure all of this information to be sure that my beneficiaries receive it? Once you have answered these more general questions, you can begin constructing your list of digital assets.
When you start your list of assets, remember that digital assets are not only those that have a monetary value. Digital assets may also include things such as social media login info, utility accounts, software, computer hardware, investments, credit card rewards accounts, email accounts, blockchain data, images, videos, files, etc. Once you have your list of assets out of the way, it is time to categorize these assets into different areas based on certain self-set restrictions.
Keep in mind that most likely not all of your digital assets should be shared with your friends and family. For example, some businesses may have company policies about intellectual property or things along those same lines. You may also have certain personal convictions about allowing certain friends or family members to have access to specific assets. This is why categorizing your digital assets is important, so that there is no misunderstanding between the executor and the beneficiaries.
After your digital assets are categorized, it is time to make sure there is secure storage of this information. There are a few different options to choose from for secure storage such as online storage services, with an attorney of your choice, or in a physical lockbox or safe on a zip drive. There is no right or wrong way to store this information, it just comes down to personal choice.
The final step is making the digital estate plan legal. To help negate conflict between the executor and the beneficiaries in the digital asset distribution process, it is important to get the digital estate plan authorized and signed by an attorney of your choosing. Without this, it can make a hard time much more difficult for those dividing the estate, as well as for those you left behind.
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