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Make it easy for your heirs to get your cryptocurrency

On Behalf of | Feb 2, 2018 | Estate Planning & Probate

Cryptocurrency, like Bitcoin, has become a serious source of wealth for some investors.

Their less cutting-edge heirs, however, may find themselves at a loss if those investors don’t make sure that their families can access the accounts.

If you’re investing in cryptocurrency, whether it’s Bitcoin or one of its lesser-known cousins, make sure that you take steps to protect your fortune in the event of your death. Otherwise, all that electronic money may end up being lost in a digital cloud forever.

How to pass your cryptocurrency to your heirs

Unfortunately, there’s not yet an easy way to do this. Because cryptocurrency is still relatively new, this hasn’t been a problem — yet — for enough people that a good system has been developed.

Investors need to think “old school” when it comes to passing on the wealth:

  1. Make sure that your family knows about the investment. A lack of information may be the number one reason that heirs end up missing out.
  2. Put all of the necessary access information where your heirs can find it. This includes the name and way to contact the digital wallet service, your login information and your digital key code. To do this, you could put the information in something as simple as a small notebook. Alternately, there are online storage accounts that you can use to store the information — but that might also be problematic for your more tech-challenged heirs.
  3. Include back-up information in a letter to the executor of your estate so that he or she has an additional copy of the information. If you only have one copy of your information out there, it’s safer, but it’s also more likely to be lost or destroyed by accident. That’s a risk you shouldn’t take.
  4. Make sure that you include your cryptocurrency account specifically in your will. That will prevent someone from walking off with the information and the digital key and claiming that he or she never saw it.

It may seem odd to propose such a low-tech solution to a high-tech estate planning problem, but these are still the best options for now.