In the past two weeks, we’ve begun discussing digital estate planning and why it’s imperative for businesses to have one today. Since many business data files are now stored digitally, it makes sense to secure these digital assets if the business owner dies.
If you still don’t have a digital estate plan and are considering whether it’s worth your time and effort to create one, the following ten reasons will convince you to get started as soon as possible.
Safeguarding Digital Assets with a Digital Estate Plan
Protecting your business is the primary aim of digital estate planning; it ensures that your business and all its assets are adequately protected after the proprietor dies, especially if they are the only ones with access to the business accounts and other online data. Instead of being lost in cyberspace, they will transfer the digital assets to the owner’s designated successor.
The owner’s passing does not inherently spell the end of the business. With a well-prepared plan, you can outline your business’s long-term objectives and designate individuals to achieve these objectives. Your business can continue to thrive long after your passing.
Enhanced Management of the Business
Sometimes, a business may persist after the owner’s passing, but in a different direction than the owner originally intended. Specifying how you want your assets dealt with in the digital estate plan can prevent this and ensure that your business follows your intended course.
Legal Compliance with a Digital Estate Plan
The law requires businesses to adhere to specific data protection and privacy regulations. Compliance with these legal requirements is one of the most important items on a checklist. When creating a plan for your digital business, it would be prudent to research any local regulations that may apply.
Protecting Intellectual Property
Most enterprises possess multiple digital assets that qualify as intellectual property. These comprise company logos, brand names, trademarks, patents, etc. Digital estate planning protects all these intellectual properties by allowing the business proprietor to determine their eventual administration and distribution.
Identification Theft Prevention with Digital Estate Plan
Without a plan, the company’s digital assets may be vulnerable to data breaches and identity theft after a business owner dies.
Upon the demise of a business proprietor, disputes can arise, like those that can occur when an individual dies and leaves an inheritance. As a business owner, you can avoid these disagreements by creating a plan that specifies the roles you want your business partners, stakeholders, and family members to play in the business after your death.
Tax Obligation Reduction
Transferring business ownership can incur costly taxes, but a digital estate plan can significantly reduce these costs.
Even if you have complete faith in your business’s successor, it is difficult to preserve your legacy after your passing. A plan allows you to specify the direction you want your business to take and provides your successor with a clear guide for managing the business as you would have desired.
A Transition that is seamless and unbroken
With everything explicitly outlined in the plan, transferring ownership should proceed smoothly. There will be no time, money, or other resources wasted with the execution of the estate plan.
Create Your Digital Estate Plan Today with Our Help!
There you have it: ten compelling arguments for creating a digital estate plan for your business. If you are ready to move forward, our team is always available to help in any way we can.
We can provide a checklist to ensure you have overlooked nothing. Plus, you can get our complimentary Digital Estate Planning Checklist and Password Cheat Sheet right here. Contact us if you have any concerns! We will assist you in ensuring that your company will remain protected, now and after your death.