Running an online business is a whole different game.
Your assets are not stored in a warehouse or filing cabinet. They reside in the cloud, behind passwords, fragmented across a dozen platforms you login to every day. Here’s the scary part…. If tomorrow something happens to you, your family may not be able to access any of it.
That’s a big problem.
The reality is that most online entrepreneurs work tirelessly to build their online empire and rarely take the time to consider what happens to all of their hard work when they pass away. Estate planning is not just for the millionaire living in a mansion with money that has been in their family for generations.
Here’s how to get it right…
Here’s the game plan:
- Why Digital Entrepreneurs Need Estate Planning
- What Counts As A Digital Asset?
- Living Wills And Why They Matter
- How To Build Your Digital Estate Plan
Why Digital Entrepreneurs Need Estate Planning
Let me be straight with you.
Statistics of estate planning are quite staggering. While most people understand the importance of estate planning, only 31% have a will, reports showed based on 10,000 U.S. adults surveyed. That means that the majority of people, including business owners, have no plan whatsoever.
Now think about that as an online business owner.
You have domains, hosting accounts, email lists, payment processors, cryptocurrency, etc. If you don’t have a plan, that stuff can get tied up, lost, or fought over. Your family can spend months (or years) just trying to prove they should be able to access it.
This is where living wills and other documents fit into place. Your living will and estate plan go hand in hand covering your wishes, and the protection of your assets. You want to consult with knowledgeable estate planning attorneys who actually understand how digital businesses work, rather than relying on a one-size-fits-all template that won’t address how you operate.
Here’s the thing about digital assets…
They’re worth more than most people think. You can get hundreds if not thousands for a high-profit email list or monetised Youtube channel. Without planning your exit that value can vanish overnight.
What Counts As A Digital Asset?
This trips up a lot of entrepreneurs.
A digital asset can be defined as anything that you own that exists digitally or online. As a internet business owner you probably have quite a few of these.
Your digital assets might include:
- Domain names and websites
- Cryptocurrency and NFT wallets
- Online store accounts (Shopify, Amazon, etc.)
- Email lists and marketing tools
- Social media accounts with followings
- Payment processors like Stripe or PayPal
- Digital products and courses you’ve created
The issue? Most of these require more than just a name in a Will to pass correctly.
Consider cryptocurrency for a moment. If you die without your private keys/passwords, those investments are lost forever. It doesn’t matter what your Will states. If there is no way to access the wallet, the funds are worthless.
That’s a painful lesson for a lot of families.
Digital assets have become one of the most significant forms of wealth accumulation. Believe it or not, 62% of Millennials invest at least one-third of their wealth into cryptocurrency. However most people still fail to document how to access them.
Living Wills And Why They Matter
Okay, let’s talk about living wills.
Many people confuse living wills with last wills and testaments. However, they are very different. Last wills and testaments take affect after death. Living wills take affect if you are still alive.
Big difference, right?
Living wills are particularly critical for an internet entrepreneur. Let’s say you are in a car accident and spend weeks in the hospital. Who operates your business? Who pays your contractors? Who continues your ad campaigns so you don’t lose money?
If you don’t have a living will and the appropriate paperwork, then no one can legally act on your behalf.
A solid living will can help you:
- Spell out your medical wishes clearly
- Name someone to make decisions for you
- Protect your business during an emergency
- Avoid family conflict over hard choices
The advantage of living wills is they spare your loved ones any burden. They won’t have to wonder what you would have wanted. Knowing that can be priceless if something goes wrong.
And they’re not just for older folks either.
Accidents and sickness don’t discriminate based on age. Whether you’re just starting out or well into your business journey, every entrepreneur should have living wills in place. It’s one of those docs you hope you never need but will happy you have.
How To Build Your Digital Estate Plan
Now for the fun part. Let’s put this all together.
Creating a digital estate plan can sound overwhelming. However, it really breaks down to a few basic steps. Take them one at a time and you’ll do just fine.
STEP 1: Take Inventory. Make a list. Write down EVERYTHING. EVERY account. EVERY login. EVERY wallet. If it’s not written down, you will forget about it. Don’t forget….
Step 2: Safely store your access information. This includes passwords, private keys, and seed phrases. Use something like a password manager that you trust or storage through an attorney. Don’t leave this lying around in notes.
Step 3: Make it legal. Your living wills and will should specifically name who gets what and who can access it. Be explicit, don’t leave it to chance.
Step 4: Maintain it. Things at your business are constantly changing. You get new accounts, new tools, new assets. Review your plan annually (or better) so it’s always up to date with what you really own.
Simple, right?
Reality is, most internet entrepreneurs never even do this. They convince themselves they’ll do it later. The problem is “later” tends to never come, and that’s when families suffer.
Don’t let that be you.
Tying It All Together
Starting an online business is years of work and hustle. Don’t let it go to waste because you didn’t have a plan.
Estate planning for digital entrepreneurs really comes down to a few key things:
- Know exactly what digital assets you own
- Put living wills and estate documents in place
- Store your access details securely
- Keep everything updated as your business grows
None of this is rocket science. It just requires some effort up front to prevent your loved ones from having a monumental headache down the road.
Your online business is an investment. Protect it. Do yourself (and your family) a favour and get covered. You’ve worked hard to create something special… Now keep it that way.