Many people associate estate plans with trusts, IRAs, paperwork, and lawyer’s offices.
But there are two critical areas of your estate plan that carry just as much weight:
- Personal property, and
- Digital assets.
While sometimes overlooked, it’s essential to account for these two valuable assets to complete your estate plan. How can you make these elements the shining stars of your estate?
How To Intentionally Divide and Document Personal Property
Because your personal possessions hold a lot of memories and traditions, many people wish to pass them along to their loved ones.
Personal possessions also often hold both sentimental and monetary value for family members—people are much more likely to fight over rare manuscripts, diamond rings, and priceless art than they are to argue over how to divvy up a 401k, for example.
To prevent confusion and ensure that your estate is distributed according to your wishes, it’s essential to make a plan. A written estate plan brings alignment and continuity to the process. You may also want to speak to your loved ones about your thoughts regarding personal property. Open and honest conversations about estate planning aren’t easy, but they do make for a more manageable transition.
Personal property presents an excellent opportunity to gift some items while you are still living, especially if you no longer use them. For example, it could be nice to see a beautiful painting in your granddaughter’s apartment now, rather than waiting to give it to her until after you pass away.
You should be honest about which loved ones your personal possessions are best suited for. If your best friend is a coin collector and your grandson can’t tell the difference between a nickel and a dime, your rare coins may be better suited with someone who can truly appreciate them. Too often, people fixate on giving items to family, but your belongings should be a blessing, not a burden to the person who inherits them.
It can be a good idea to divide personal property explicitly in your will.
Too much stuff to fit on one page? You could also consider creating a personal property memorandum that allows your executor to determine which smaller items are willed to which people quickly. This estate planning document is separate from your official will and testament and can be changed as many times as you want without a witness or notary.
Why Your Digital Assets are So Critical (and How To Keep Your Loved Ones from Getting Lost in Cyberspace)
Many people underestimate their digital assets, but they’re a significant part of any complete estate plan. Digital assets can include things like,
- Domain names,
- Credit card rewards,
- Online bank and investment accounts,
- Virtual currencies, and more.
It also includes other elements of your digital profile, like email and social media accounts.
These items can have sentimental as well as monetary value. Some digital assets, like your Facebook profile or old photos, might not carry much financial weight. But others, such as cryptocurrency or popular domain names, can be precious.
Even if you don’t have valuable digital assets, it’s still critical to account for these items in your plan. An organized plan makes it easier for your executor or other loved ones to access and manage digital assets after your death, whether they plan on selling them, deleting them, or transferring them to another party.
Where should you get started?
Step 1: Complete a digital inventory of all of your online presences and assets, including usernames and passwords. Store all of this information in a safe, private place.
Step 2: Decide who will manage these assets after your death.
The executor of your estate is a logical first choice, but it might also make sense to ask a younger, more technologically savvy loved one to manage them if your executor isn’t up to the task.
Once you have decided how you’d like these assets handled, call up your attorney and have it written into your will. Whether you plan to sell certain valuable digital assets, keep them in the family, or another option, it’s good to make these decisions explicitly so that your estate is handled precisely how you want.
Make Your Estate Plan Comprehensive
Your estate—your legacy—is about much more than just the balance in your bank account. Personal property and digital assets are two areas that may be important both to you and to loved ones, and as such, should be considered with the same care and attention as any other element in your plan.
In many cases, these items carry significant sentimental or practical value in addition to their monetary value. Because sensitive items spark many emotions, it’s essential to have a plan.
A comprehensive estate plan is the best way to ensure that your estate is distributed according to your wishes, and your loved ones can easily manage your estate after your death. If you’re looking for a way to include personal property in your estate plan, we’d love to help.
We’re experts at retirement and estate planning and pride ourselves on taking a comprehensive approach that considers all aspects of your estate and assets. Get in touch with us today to learn more!