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Discussing Estate Planning in the Holiday Season

With so many families living in distant states, the holiday season is often the only time everyone is together. A family gathering can provide a chance to talk about major life changes and plans for the future, including estate planning issues. It can be tricky to navigate. However, some conversations are simply better in person. A recent article from Independent Record, “How to tackle estate planning with loved ones this holiday season” outlines topics to cover.

Beneficiary Designations. Upon opening savings, investment and retirement accounts, an option is usually provided to name a beneficiary. This tells the financial institution who is to receive the asset upon the owner’s death, similar to how a beneficiary is named on a life insurance policy. There are often contingent beneficiaries if the primary has died or does not want to receive the assets.

Beneficiary designations should be checked every few years and when certain triggering life events occur, like death, divorce, or marriage. Some financial institutions have default beneficiary designations, so the owner should also have this information. The beneficiary receives these assets outside of the will, avoiding probate in most cases. Tax treatments of these instruments may differ, so they should be reviewed with an estate planning attorney to see how they work with the estate plan.

Power of Attorney. The POA is a document allowing an individual to name someone to make decisions on their behalf if they are incapacitated. This document should be discussed with the chosen person, usually a spouse, adult child, trusted friend, or an estate planning attorney, with their consent. If there are issues with family members, a non-family member may be a better choice.

There are different types of POA. A durable POA takes effect immediately and doesn’t expire. A non-durable POA is valid for only a specific period of time. The healthcare POA, also known as a healthcare proxy, is also needed for another person to be involved in medical care: spouses are not automatically given these rights. A HIPAA release form should also be in place, so the POA can talk with doctors and others involved in medical care.

Wills and Trusts. If there is no will, the person’s assets are distributed according to the laws of the state, which, in most cases, is decided based on kinship. Most people opt to have a will to decide how their assets are distributed.

Trusts establish a separate legal entity managed by a trustee, who also oversees distribution at the time indicated in the language of the trust. Unlike a will, assets in a trust are distributed privately and outside the court system, meaning they don’t pass through probate. An experienced estate planning attorney creates a trust to meet the specific needs of the grantor.

It’s a good idea to talk about these issues while the family members are well and able to discuss them with a clear head. An estate planning attorney will help with guidance and could also help figure out how to navigate issues when potential conflict exists. During and after the holiday season, estate planning protects loved ones and ensures that wishes are followed.

Reference: Independent Record (Nov. 25, 2024) “How to tackle estate planning with loved ones this holiday season”

How to Avoid Estate Planning Mistakes in 2025

Even if you could remove all of the emotions about estate planning, like considering your eventual demise and the possibility of incapacity, it can still feel a bit overwhelming. Having an experienced estate planning attorney on your team makes the process far easier, with the knowledge you’re in good hands. A recent article from GO Banking Rates, “4 Expert Insights on Avoiding Estate Planning Pitfalls for 2025,” explains how estate planning helps to avoid family fights, lost assets and legacies.

Estate Planning encompasses your entire life. Wills express how you want assets to be distributed, and trusts minimize taxes by taking assets out of the probate estate. However, an estate plan is more than these two pieces. Estate plans include incapacity plans, caring for children and transferring wealth in a number of ways.

If someone becomes incapacitated and hasn’t created a Durable Power of Attorney, no one can manage non-healthcare matters, from paying utility bills to maintaining their home. A family member must go to court to obtain guardianship to do anything.

Every estate plan should include a Healthcare Power of Attorney and HIPAA release authorization so a designated person can be involved with their loved one’s healthcare, talk with their doctors and be involved in any medical decision-making.

Keeping beneficiary designations up to date. Beneficiaries aren’t just the people you name in a will. Designated beneficiaries are those listed on retirement accounts, investment accounts, life insurance policies and other documents to receive assets when you die. Make sure these names are up to date, especially if you haven’t reviewed them in years. Any account with a beneficiary designation does not go through probate, and your will has no control over these assets.

Things will get messy if beneficiaries on your accounts are no longer in your life. Assets could go to an ex-spouse, an estranged family member, etc.

Choosing your executor with care. Many people get stuck when there is no obvious person to manage this task. An experienced estate planning attorney can help you work through this issue, since a poor choice could put your entire estate plan at risk. Whoever you choose to serve as executor—the person who manages your estate—will need to deal with financial institutions, family members, government agencies and every facet of your life. Many automatically name their eldest child or best friend, which might lead to disaster if they are not available, good with details, fiscally knowledgeable, or able to manage your family’s personalities. Ensure that they are up for the task and also have a backup executor named.

Introduce your family to your estate planning attorney, financial advisor, CPA and other professionals in advance. The people who help you manage the business side of your life will be able to help you better if family members know who they are, how to contact them and have already met them. They don’t have to be friends. However, making introductions in advance can make their work together easier.

Reference: GO Banking Rates (Nov. 17, 2024) “4 Expert Insights on Avoiding Estate Planning Pitfalls for 2025”

Probate for Real Estate in Multiple States: Managing Assets

Probate is complicated. However, things can get even trickier when managing real estate in multiple states. If you own property outside your home state, your heirs may face extra steps in settling your estate. Here’s a look at how probate works for real estate in multiple states and how you can help your loved ones avoid these challenges.

What Is Probate?

Probate is the legal process of distributing a person’s assets after death. For real estate, probate involves the court supervising property transfer to the rightful heirs. This can take months or even years, depending on the complexity of the estate. When real estate is involved, mainly if it’s located in more than one state, it can complicate matters even more.

Each state may require a separate probate process when you own property in multiple states. This means your family could deal with probate proceedings in several locations, which can add time, legal costs and stress.

Probate Across States

If you own property in a state other than where you live, your estate could go through two different probate processes—one in your home state and another in the state where the property is located. This is called “ancillary probate.” The probate process in your home state handles all your other assets, but any real estate outside of your state is subject to the probate laws where the property is located.

Each state has rules for probate, including who can inherit property and how long the process takes. If you don’t plan, your heirs could face additional delays and legal fees as they navigate probate in multiple states.

Can You Avoid Probate in Multiple States?

According to Forbes, there are ways to avoid probate for real estate, even if it’s located in different states. By planning, you can save your heirs time and money. Here are a few options:

Should You Use a Revocable Living Trust?

One of the most effective ways to avoid probate is to create a revocable living trust. This allows you to transfer your real estate ownership into the trust while still alive. You remain in control of the property during your lifetime. After you pass away, the property goes directly to your beneficiaries without going through probate.

Creating a revocable living trust requires some legal work. However, it can be a much simpler and faster way for your heirs to receive the property after your death. It can also help them avoid the costs and delays of ancillary probate.

Is a Transfer-On-Death Deed Good for Real Estate Inheritance?

In some states, you can set up a transfer-on-death (TOD) deed for real estate. This allows you to name a beneficiary who will automatically inherit your property when you pass away. A TOD deed can be more affordable and straightforward to avoid probate. However, it’s unavailable in every state. If you own property in multiple states, you must check if each allows TOD deeds.

Avoiding Probate with Co-Ownership

Another way to avoid probate for real estate is by co-owning the property with someone else. If you and your spouse, for example, own a home together, the property might automatically transfer to the surviving spouse upon your death without going through probate. However, this option only works for certain types of co-ownership, so knowing how your property is titled is essential.

When You Should Seek Legal Help

Dealing with probate for real estate in multiple states can be complicated. Every state has laws and rules about how probate works and how property is transferred. Talking to a probate lawyer is good if you own real estate in numerous states. They can help you understand your options and create an estate plan to make things easier for your loved ones.

Protect Your Property Across State Lines — Start an Estate Plan Today!

Planning is essential to ensure that your family avoids the stress and costs of probate; a probate lawyer can help you explore your options, whether creating a living trust, setting up a TOD deed, or exploring co-ownership strategies. Contact our law firm today to request a consultation and start planning to protect your real estate and other assets.

Key Takeaways:

  • Simplify the probate process: Avoid multiple court proceedings for real estate in different states.
  • Save time and money: Keep your heirs from dealing with costly and lengthy probate.
  • Maintain privacy: Keep your real estate transfers out of the public record with proper estate planning.
  • Ensure smooth asset transfer: Use trusts, TOD deeds, or co-ownership to help your family inherit without the hassle.
  • Protect your loved ones: Plan with the help of a probate lawyer to minimize future legal challenges.

Reference: Forbes (Aug. 23, 2024) “A Guide To Probate In Real Estate: What You Should Know”

Wealth Protection Through Estate Planning

Without a well-prepared estate plan, wealth can be lost to taxes, administrative costs, or disputes among heirs, both in and out of court. With an up-to-date estate plan, changes to tax laws are proactively addressed and wealth can be protected and passed across generations. A recent article appearing in Medical Economics, “Estate planning is your first line of defense against wealth loss—Here’s what you should know,” explains how an estate plan creates a framework to minimize taxes, avoid the costs and complications of probate and ensures that your wishes for your estate are followed.

Documenting assets is one task that is done when creating an estate plan. When records are not clear, transferring assets can become complicated. A comprehensive record-keeping system can store documents like deeds, life insurance policies, asset inventories, family videos and photographs online.

Many financial records are already online through client portals by major financial companies. The key to incorporating these records into an estate plan is remembering where all the information is stored and being willing to share access information with a trusted family member or friend. The person you name as an executor of your will or a trustee for a trust is the most likely candidate to be provided with this information.

There are many steps to having a solid estate plan. However, there are also many missteps. Here are some of the most common pitfalls to avoid:

Failing to update an estate plan. All the documents in your estate plan, including a Will, Power of Attorney, Healthcare Proxy, HIPAA Release Form, Trusts, Advanced Directives and more, must be updated to comply with changing laws and changes in your life.

Making a careless decision about the executor or trustee can be disastrous. The eldest child does not have to be the one to be in charge of your estate. Neither does the person you love if their life is a trainwreck. The person to be named executor and/or trustee needs to be someone you know to be extremey

Wly responsible, reliable, good with money management and a solid moral compass.

Digital assets are often ignored when it comes to estate planning. However, this new asset class needs to be included. If you have email, you have a digital asset. You have digital assets if you have email, cryptocurrency, websites, social media content, online subscriptions and photos stored in the cloud. Suppose no plan is made to create an inventory of accounts and name a digital executor. In that case, your estate becomes vulnerable to identity theft, valuable cryptocurrency could be lost forever and there may be nothing your loved ones can do.

Most family fights have to do with unequal asset distribution after the death of a parent. A clear estate plan is one way to preclude confusion about what you want to happen after death. Talking about your estate plan while you’re still able to have these uncomfortable discussions is one way to help establish your wishes. You may want to create a Letter of Intent or make a video to express your reasons for making certain decisions. This may not be legally enforceable. However, it will serve to document your wishes.

Estate planning is not just about distributing assets after death. By establishing an estate plan, the family is better prepared to deal with the loss of a loved one and can focus on healing together instead of battling over their inheritance.

Reference: Medical Economics (Oct. 17, 2024) “Estate planning is your first line of defense against wealth loss—Here’s what you should know”

Millennials Need Estate Planning

One family jokes about their mother’s large blue binder, affectionately calling it “Mom’s Book of Life.” She has assembled physical copies of estate planning documents, including medical directives for next of kin, account information, passwords and a list of assets. Her adult children thought they were too young to deal with such matters, reports a recent article, “I’m Way Too Young For Estate Planning. Or Am I?” from The Wall Street Journal. On reflection, they realized they, too, needed an estate plan.

Someone as young as 18 could benefit from having an estate plan, and someone in their 30s definitely needs one. Once a young person becomes a legal adult, their parents no longer have any say in financial or health matters without properly prepared estate planning documents.

Everyone over 18 should have an advanced healthcare directive, sometimes called a healthcare proxy or healthcare power of attorney. This allows people of your choosing the ability to make decisions about your healthcare if you become incapacitated: too sick or severely injured and unable to communicate your wishes.

Adults of all ages also need a power of attorney. This document gives another person the legal authority to access and manage your finances in case of incapacity.

A will, also known as a last will and testament, is needed to direct how you want your assets to be distributed after death. Even if you don’t own a home or car, chances are you have some personal property and may want specific people to receive certain items. Creating a will and getting used to the concept of planning for the future is a good habit.

If you have an extensive online life, digital assets will also require some planning. An inventory of your digital assets, including email accounts, apps, social media, cryptocurrency, photos, videos, etc., should be created, so a digital executor can manage the accounts. Some platforms permit naming a legacy contact, while others require specific directions on what should be done with your content.

Student loans, 401(k)s from employers and other financial accounts should be inventoried. However, this information doesn’t go into the will. The will becomes a public document once submitted to the court for probate, so any specific account information should be kept in an inventory of assets and debts.

Creating an estate plan can open a conversation with older relatives and parents about their plans for end-of-life care, a difficult but important dialogue. Talking about their wishes before something happens will allow you or other relatives to know beforehand, rather than spending the rest of your life worrying about a decision made in an emergency situation.

Estate plans need to be changed as you go through your life. New partners or spouses may need to be added, or a deceased parent may need to be removed as an executor. Getting used to addressing these life matters is part of being a responsible and loving adult.

Reference: The Wall Street Journal (Oct. 18, 2024) “I’m Way Too Young For Estate Planning. Or Am I?”

Estate Planning Lessons from Mickey Mouse and Cinderella

At the center of every fairy tale is a human story centered around basic life experiences, as any English major will tell you. Therefore, it’s no surprise that the stories and characters from Disney hold life lessons for estate planning, as described in a recent article, “9 Estate Planning Lessons From Disney Movies,” from Forbes.

For a blended family story, look no further than Cinderella. When her father died and left his estate to an evil stepmother with two equally wicked daughters, he may not have thought of the impact it would have on poor Cinderella. By structuring the estate plan to provide for his daughter from the first marriage, he could have prevented Cinderella from being economically dependent on her stepmother. Leaving a portion to Cinderella and the remainder to the stepmother could have ended the story long before the prince entered the picture. Putting assets into a trust for Cinderella and naming a neutral party as trustee is another option her father could have explored.

Snow White’s seven dwarfs is a tale of planning for dependents. Each dwarf has their own behavior traits and needs, just as children do. For minors or children with special needs, unique circumstances need to be addressed by estate planning. Parents need to put a clear guardianship plan in place to protect dependents and be sure they are cared for by people who understand their needs. Without a plan, which includes a will naming guardians and a Special Needs Trust if appropriate, the court may appoint a guardian who might not be a good fit for the child. Establishing trusts can ensure that funds are available for education and living expenses, adding another person looking out for the child.

Who better represents incapacity than Sleeping Beauty? Facing a health crisis in which people can’t make their own decisions requires planning. A financial power of attorney and healthcare proxy ensure that someone you know and trust will be able to act on your behalf if you should eat a poisoned apple and fall into a deep sleep. By planning for incapacity, you can prevent court intervention and ensure that your healthcare choices are followed.

The Princess and the Frog exemplifies the need for good business succession planning to ensure that the business has a future. Does a business owner want to pass the business on to the next generation or sell it? This requires planning for taxes and estate planning. How should assets be gifted to minimize tax liabilities?

Failing to have an estate plan often leads to a sad ending for family members. Without it, there’s no guarantee of a kind-hearted prince or magical enchantress stepping in to make things right. Consult with an experienced estate planning attorney to protect your children and yourself from the twists and turns of life.

Reference: Forbes (Sept. 27, 2024) “9 Estate Planning Lessons From Disney Movies”

Should I Hire a Lawyer When Starting a Business?

Starting a business is an exciting journey but comes with many decisions and responsibilities. One question that often comes up is whether you need to hire a business lawyer. It might seem like an extra expense. However, having legal guidance can save you a lot of trouble down the road. Find Law explores when hiring a lawyer makes sense and when you can handle things independently.

What Business Matters can I Handle on My Own?

When starting a business, there are a few tasks you can likely tackle without the need for a lawyer. While every situation is different, some aspects of business planning don’t require professional legal assistance.

Writing Your Business Plan

A well-organized business plan is essential for securing funding from banks or investors. It outlines your mission, target market, business opportunities and financial projections. Although this step is critical, many entrepreneurs can create a business plan without legal help. However, if you want peace of mind, a business lawyer can review your plan to ensure that it meets legal standards.

Choosing and Registering Your Business Name

Picking the perfect business name is a big deal. It is your brand’s identity. Before committing to a name, you’ll want to ensure that it isn’t already in use. A business lawyer can help you conduct a thorough trademark search to avoid potential legal issues in the future.

Once you’ve chosen your name, registering it under a “Doing Business As” (DBA) can usually be done without legal help. However, having a lawyer check everything can be reassuring.

Applying for an Employer Identification Number (EIN)

An EIN is required to file taxes, open business bank accounts and pay employees. Fortunately, applying for an EIN is something you can easily do on your own through the IRS website. In most cases, this is a straightforward process that doesn’t require legal assistance.

When Should I Hire a Lawyer?

While there are tasks you can manage independently, some legal matters are best handled by a business lawyer. These issues can be complex and costly to fix if not done correctly from the start.

Choosing the Right Business Structure

Choosing the right structure for your business is one of the most critical decisions you’ll make. Whether you go with a sole proprietorship, LLC, corporation, or partnership will have lasting impacts on taxes and liabilities. A business lawyer can help you understand the pros and cons of each option and recommend the best fit for your situation.

Drafting Contracts and Agreements

Having clear and legally sound agreements, from partnership agreements to employee contracts, is essential. A lawyer can draft these documents to protect your interests and avoid conflicts later. These can include employment agreements, sales contracts and even confidentiality agreements to safeguard your business’s sensitive information.

Protecting Intellectual Property

If your business creates unique products, branding, or inventions, protecting your intellectual property (IP) is crucial. A business lawyer can help you to secure trademarks, copyrights, or patents to ensure no one else can profit from your hard work. While this process can be complex and time-consuming, it’s an area where legal help is often necessary.

Should I Hire a Lawyer for Lease Agreements?

You must sign a lease agreement if your business requires office or retail space. Lease terms can be tricky. Therefore, signing without fully understanding the fine print could cause problems. A business lawyer can review the agreement to ensure you get a fair deal and that the lease protects your interests.

How Should I Protect My Personal Assets?

One of the main reasons entrepreneurs hire a lawyer when starting a business is to protect personal assets. Without the right structure, your personal bank accounts, home and other assets could be at risk if the business faces lawsuits or financial trouble. A business lawyer can guide you in setting up your company in a way that shields your personal property from business liabilities.

Avoiding Legal Trouble

No one starts a business thinking they’ll get sued. However, it’s always a possibility. A lawyer can help you take preventive measures, such as drafting clear contracts, setting up proper company policies and ensuring that you follow all regulations. Having legal counsel can help you avoid the headache and expense of lawsuits.

How Can a Lawyer Help Me with Taxes?

While you might not think of taxes when you first launch your business, they play a significant role in your overall success. A lawyer can explain tax benefits, deductions and liabilities for your specific business structure. They can also help if you expand your business into other states or countries, ensuring that you stay compliant with local tax laws.

Take the First Step Today

Starting a business involves many moving parts. Having a solid legal foundation can make all the difference. If you’re ready to take the next step in creating or growing your business, schedule a consultation with our law firm today. We can help you navigate the complexities of business planning and ensure that you’re protected every step of the way.

Key Takeaways:

  • Save time and avoid mistakes: A lawyer can handle complex legal tasks, such as choosing the right business structure and drafting contracts.
  • Protect your assets: Ensure that your personal property is shielded from business liabilities.
  • Prevent future legal troubles: A business lawyer can help you to avoid costly lawsuits and ensure regulatory compliance.
  • Protect your intellectual property: Secure trademarks, patents and copyrights with professional legal guidance.
  • Gain peace of mind: With a lawyer’s help, you’ll have confidence that your business is legally sound from the start.

Reference: Find Law (May 23, 2024) “Do I Need a Lawyer To Start a Business?“

Why Gen Z Needs to Pay Attention to Estate Planning

Gen Zers may still be young, ages 17–27. However, this doesn’t mean some don’t have ownership and assets to protect with estate planning. Medical emergencies and car accidents happen to people of all ages. An estate plan protects the person as much as their property. The sooner you have a plan in place, says a recent article from yahoo! finance, “Why Gen Z Should Be Thinking About Estate Planning,” the better.

For many young adults, estate planning is like buying rental insurance. You don’t expect to deal with a fire or have your home broken into. However, having insurance means if such events happen, your possessions will be insured, and you’ll be made whole.

Gen Zers who are signed up for employee benefits like 401(k)s or retirement plans already have assets to be passed to another person if they should die young. These accounts typically feature beneficiary designations, so they should be sure to have those completed properly. Many Gen Zers name their parents or siblings as their beneficiaries at this point in their lives. The future may bring new relationships, marriage and children, so they must update these beneficiaries throughout life.

While practically everyone using a cell phone or computer has digital assets, Gen Zers are likely to have more digital currency and crypto in digital wallets. They may have intellectual property on platforms, including TikTok or YouTube. These assets need to be protected in a digital estate plan. The information required to access these accounts should not be in a last will and testament. However, they should be documented so the assets are not lost.

Other digital assets don’t have any value. Users don’t have the right to transfer the assets, like social media accounts or music files. Having a conversation with a digitally savvy person about these assets and providing them with login and account information is an integral part of an estate plan.

Gen Zers do need a will. Without a will, the estate will get tangled up in probate, a court process where the laws of your state determine who inherits any possessions. This takes time and court fees can add up quickly.

Having a will created with an experienced estate planning attorney encourages a review of assets, providing a perspective of finances that one might not otherwise have early in their career.

Estate planning also includes planning who will make medical and financial decisions in case of incapacity. These documents, including a Power of Attorney, Healthcare Proxy, Living Will and other documents, are state-specific. Once someone becomes a legal adult, neither parents nor siblings can be involved with medical care or handle finances, unless these documents are created and executed. Trusted friends can also take on these roles.

A young adult should make an appointment with a local estate planning attorney. They’ll provide guidance through the process. Regardless of age and stage, having a plan creates peace of mind for young adults and their family members.

Reference: yahoo! finance (Sept. 17, 2024) “Why Gen Z Should Be Thinking About Estate Planning”

Should I Give My Kid Their Inheritance Before I Die?

Some wealthy people have publicly declared their intention to give away their wealth before they die to see their philanthropy’s impact. However, these people usually don’t have to worry about making ends meet, unexpected medical bills, or expensive home repairs. A recent article, “How to Give an Inheritance While You’re Alive,” from Kiplinger, agrees that more than half of Americans in their 60s will need long-term care services at some point. Don’t rush to give away your kid’s inheritance just yet.

For most people, the solution is transferring wealth through estate planning, using a last will and testament. You won’t need the assets after death; your loved ones will be grateful for the bequest.

However, there are some downsides to hanging on to all of your assets while you’re living. If you’re lucky enough to live into your nineties, your “kids” may be in their sixties or seventies when you die. Their need for help with a deposit to buy a home will be long past.

It’s heart-warming to be able to help your family when they can use the help. You get to see how your hard work has helped the next generation. If you’re involved in charitable causes, a donation while you are living allows you to see the impact of your own giving.

Giving with warm hands or while living isn’t possible for everyone. If you think it might be possible, start by crunching the numbers. How much can you really afford to give away? You’ll need to be very intentional about planning. Just deciding to cut back on spending won’t be enough.

Your estate planning attorney may talk with you about using trusts. Creating and funding a trust means lowering your taxable estate, creating more wealth to pass onto heirs and, if you wish, having the trust distribute assets while you’re living. If you use a living trust, you will be able to change the terms whenever you want. Therefore, if it becomes clear you will need the money, you have access to it.

You’ll also need to determine if you have enough funds to pay for long-term care or if you need to begin planning for Medicaid eligibility. A living trust is countable as an asset for Medicaid. However, a Medicaid Asset Protection Trust is not. Your estate planning attorney will help you plan this out.

Home equity is something Boomers, in particular, should consider when considering paying for long-term care. The proceeds from the sale of your home could cover the cost of long-term care. Another option is taking out a reverse mortgage, which lets you enjoy the equity in your home without selling the property.

In 2024, taxpayers may gift up to $18,000 to as many people as they want without incurring gift taxes or filing a gift tax return. Married couples may give up to $36,000 to as many people as they wish. If this might work with your retirement finances, it’s a good way to reduce your estate tax burden.

There are many strategies for making gifts while you’re living. Take a clear, objective look at how much you’ll need to enjoy your retirement years before making any big decisions. Talk with your estate planning attorney about how to make this happen. Congratulations—you’ll get to see your legacy in action if it’s something you can realistically do.

Reference: Kiplinger (September 1, 2024) “How to Give an Inheritance While You’re Alive”

What Happens to Digital Assets when You Die?

Remember the phrase “Swedish death cleaning?” This trend was based on decluttering your life while you’re living so you don’t leave a disaster for loved ones when you pass. Digital death cleaning may be even more critical than decluttering because you can’t clean out what you can’t find.

A recent article from The Wall Street Journal, “Why Everyone Needs a ‘Digital Death-Cleaning’ Plan,” offers a way to get organized so digital assets aren’t lost or used for identity theft and even worse cybercrimes.

Create categories and label files. A file with deeply personal materials might be labeled “DoD—Delete Upon Death,” while a file containing information about finances could be labeled “Relevant.” The goal is to let survivors know if they will need the files.

DoD files are stuff you don’t want anyone to read after you’ve passed. Years of complaints about your ex-spouse or the difficulties in raising children might be better-left unread. Another idea is to put these kinds of files on a hard drive somewhere and label them, so they can be destroyed as per the instructions in your will. Don’t count on encryption to protect files. Just as any password can be hacked, any file can be opened.

Relevant files include information about your estate, finances and account passwords. If you keep instructions about heating or air conditioning systems on the computer, they may be needed to keep things running—for example, if your oil burner is cranky and needs extra TLC at the start of every heating season.

You’ll probably have files to label “Memorabilia.” These may be photos, videos, or anything you think children or grandchildren would like to read in the distant future to learn about you, your family history and the world you lived in.

All your organizing will work best if you also leave a physical document with a list of digital assets, such as subscriptions, email addresses, utility login info, etc.

Talk with your estate planning attorney to determine how your state addresses digital assets in wills. Most states have adopted a uniform law concerning digital assets, so you’ll want the estate plan to follow these rules.

Finally, consider digitizing your life. If you have a collection of photos, articles you’ve published, or ephemera, all of it can fit into a shoebox if it’s been digitized and stored on thumb drives. You’ll be able to enjoy it as an online memory book now, and your children won’t be stuck clawing through an endless series of boxes later. If you’re a true packrat, chances are your children know it and will appreciate your efforts to lighten their lives after you’ve passed.

Doing your digital cleaning is also the time to review your estate plan, especially if it’s been a few years since it was reviewed. If you don’t have an estate plan, now is the time to meet with an experienced estate planning attorney to create a will, plan for incapacity with a Power of Attorney and Health Care Power of Attorney and related documents depending upon your unique situation.

Reference: The Wall Street Journal (Aug. 6, 2024) “Why Everyone Needs a ‘Digital Death-Cleaning’ Plan”

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