Estate Planning for Investors: The Guide to Wills, Trusts, and Digital Assets

According to 2024 data, only about 32% of US adults have a valid will. Many assume estate planning is only for the ultra-wealthy or retirees. In reality, even moderate investors hold assets, brokerage accounts, real estate, retirement plans, and digital holdings that can become tangled in probate without clear instructions.

The real issue isn’t wealth; it’s control. Without proper documentation, state laws, not personal intent, decide how wealth transfers.

So what? For anyone managing their own investments, a basic estate plan helps support financial continuity.

Key Takeaways

1. Fewer than one-third of Americans have a valid will, leaving their estates to default state rules.
2. A plan goes beyond a will, covering trusts, POAs, healthcare directives, digital assets, and tax coordination.
3. Digital estates (including crypto and online accounts) are often ignored but increasingly valuable.
4. Regular reviews and beneficiary updates are important to keep plans accurate and aligned.
5. For self-directed investors, integrating estate planning with investment, tax, and retirement strategy, using portfolio-tracking or planning tools such as PortfolioPilot, can help maintain alignment across accounts.

What Happens If You Die Without a Will?

When someone dies intestate (without a will), their estate goes through probate, where the state decides who inherits and who administers the assets.

• Hypothetical: A mid-career investor with $1 million in brokerage accounts, a $400k home, and a small business interest dies unexpectedly. Without a will, those assets may be distributed by rigid formulas that don’t reflect actual wishes.

Probate can take months, cost thousands, and burden loved ones. A simple will can help avoid those frictions and ensure the right people receive the right assets, faster.

So what? A single document can save your family both money and emotional strain.

What Documents Do You Actually Need?

An estate plan isn’t a single form; it’s a set of coordinated documents that address both death and incapacity.

1. Will (Last Will & Testament)

Defines who inherits, names an executor, and can appoint guardians for minor children.

• Select beneficiaries and alternates.
• Appoint an executor you trust.
• Review state-specific witness rules.

Why it matters: A will doesn’t avoid probate or taxes, but it ensures your wishes guide the process rather than state defaults.

2. Trusts

A trust is a legal entity that holds assets on behalf of beneficiaries. It can streamline transfers, protect privacy, and manage the timing of distributions.

• Revocable living trust: Control remains with you, but assets can transfer without probate.
• Irrevocable trust: Harder to change but may offer tax or asset-protection benefits.

Common misconception: Trusts are only for the wealthy.  In reality, anyone with multiple accounts, property in more than one state, or privacy concerns may benefit.

So what? For mid- to high-net-worth investors, a trust can save both time and tax friction, but it must be properly funded to work.

3. Power of Attorney (POA) and Advance Directive

These govern incapacity, not death.

• Financial POA: Authorizes someone to manage finances if you’re unable.
• Healthcare directive: Expresses medical preferences and names a healthcare proxy.

Why it matters: Incapacity is statistically more likely than early death. Without a POA, even spouses may need court approval to access accounts.

So what? A simple POA can prevent frozen assets and family conflict when decisions must be made quickly.

4. Digital Asset Plan

Digital assets include everything from crypto wallets to social-media accounts and password managers. According to a 2024 Bryn Mawr Trust survey, Americans valued their digital holdings at $191,516 on average, yet only half had included them in estate plans. Include:

• A secure inventory of logins, wallets, and access keys
• Clear instructions on which assets to transfer, retain, or delete
• A digital executor or trusted contact

So what? Even a well-written will can fail if no one can access your accounts or crypto wallets.

5. Tax Coordination and Beneficiary Designations

Taxes and beneficiaries often determine the actual outcome of an estate plan.

• Federal estate-tax exemption: $13.99 M per individual (2025), but subject to change.
• Step-up in basis: Heirs often inherit assets at fair-market value, reducing capital-gains exposure.
• Beneficiary forms: For IRAs, 401(k)s, and insurance policies, the form overrides the will.

So what? A forgotten beneficiary form can redirect hundreds of thousands of dollars, even against current wishes.

Are Trusts Only for the Wealthy?

Not necessarily. Trusts can serve specific, non-tax functions:

• Privacy: Assets pass outside public probate records.
• Continuity: Smooth transfer of control in incapacity.
• Conditional inheritance: Funds can be released over time or upon milestones.

Hypothetical: A parent wants to fund children’s education but avoids lump-sum distributions. A revocable trust can hold the assets and specify timing, all while avoiding probate.

So what? A trust can be a management tool, not just a tax strategy.

How Do Digital Assets Fit Into Your Estate Plan?

In 2025, digital property is part of financial identity. Investors now hold crypto, e-trading accounts, digital IP, and online income streams that may outlive them. To manage these:

1. Keep a secure inventory of all accounts.
2. Specify how each should be handled (transferred, deleted, or retained).
3. Use password managers or encrypted vaults with shared executor access.
4. Review each platform’s “digital legacy” policy (e.g. Google, Facebook, Coinbase).

So what? A missing password or wallet key can erase years of accumulated value. Planning ahead keeps your digital estate intact.

How Often Should You Update Your Documents?

Life changes faster than most estate plans. Review every 3–5 years, or after any of these events (common guidance):

• Marriage, divorce, or birth of a child
• Relocation to another state
• Business sale or major investment shift
• Death of a key beneficiary or executor
• New asset types (e.g. crypto, digital property)

So what? An outdated plan is almost as risky as no plan. Keeping it current ensures your strategy reflects your life today, not five years ago.

Quick Reference Table: Core Documents

10-Minute Estate Plan Audit

Use this as a quick self-check:

• Do I have a valid, signed will?
• Are my beneficiaries current across all accounts?
• Have I documented my digital assets and access credentials?
• Is my POA and healthcare directive up to date?
• Do my estate and investment plans align?
• Have I reviewed my plan in the past three years?
• Have I shared key documents or access with my executor or attorney?
• Are any trusts properly funded?
• Do I understand potential tax implications for heirs?
• Are all documents securely stored and retrievable?

Even the best documents fail if key people can’t find them. Share at least your executor’s copy, main contacts, and login instructions through a secure, encrypted method.