Digital Assets with Steven LaBroi, Wealth Strategist – August 19, 2018
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Twanda Black: Good morning. Thank you so much for coming back to the show. I’m Twanda Black, and I’ve got our wealth strategist, Steven LaBroi in us. CEO and chief strategist at the LaBroi Insurance Group, Millennial Banking Concept. How are you this morning?
Steven LaBroi: This is great. I am doing great. This is a great Sunday.
Twanda Black: Alive and in person.
Steven LaBroi: For the first time, I’m in the studio with you.
Twanda Black: Phenomenal [crosstalk 00:00:25]. So look, you surprised me with this subject today, and we talk about this all the time, believe it or not. Not this, but a portion of it: digital. And you’re talking about digital assets for all of us, something that we don’t really, really think about, do we?
Steven LaBroi: Well, you know, it’s a new day, and a lot of things are going pretty fast, but digital assets is something that we have to pay attention to. More and more people out there, I’m just going to say, everybody has digital assets today.
Twanda Black: So what does that mean when you talk about digital assets?
Steven LaBroi: Simply stated, advances in technology created all these new forms of property ownership. So digital assets are part of your estate plan, and again, estate plans are done by attorneys, but digital assets are … we’re going to go down the list, but your emails, your PayPal accounts, all the things that we have in the palm of our hand that we own, that we’re going to do something with throughout our lifetime.
Twanda Black: That’s right, that’s right. So let’s break it down a little bit. Start with banking. A dear friend of mine just passed a bit ago, and his family was looking into his banking and financial accounts. They were trying, anyway. I don’t know if they were successful.
Steven LaBroi: Right, right. I mean, if you really think about it, online banking is the new way of doing business, and all our financial institutions … I mean, I just got caught out there when I was able to take a picture of a check and deposit it from my home. Well, if you understand that, you own your password and user ID. What’s going to happen when you need to transfer that to someone in your family? When someone needs to have access to your Vimeo account, your cash app account. All these accounts where you hold money-
Twanda Black: PayPal.
Steven LaBroi: Yes, PayPal. And people just don’t think about it. Those are where your assets are being held now. They can’t go in the branch all the time to find out where your funds are, or where your accounts are.
Twanda Black: So, if we don’t say anything or assign that to anybody as it were, what happens at our death?
Steven LaBroi: Well, just like most tangible assets, they go through a probate process, and you know, we’ve all seen the issues around that. With families who are experiencing that, it can be a daunting task, plus it’s costly. But a lot of these assets, especially if you have a family member who has amassed quite a few digital assets, people are going to want to have some kind of claim to that. So you’d have to go through the courts.
Twanda Black: That’s crazy. So we know we got to do already. Digital currency, which I thought was really interesting, I know a lot of people who own Bitcoin.
Steven LaBroi: Wow. And this is a big phenomenon. I’ll just make sure people understand. This whole area of digital assets is continuing to grow. Bitcoin, I mean, there are at this time over 1200 different coins. Ethereum, I mean, the list goes on. But there’s going to have to be some claim laid to those. If we’re making these fortunes, and we’re talking about generational wealth more than we’ve ever talked about it in the past, there’s got to be a way of making sure others are aware of it. So the key is creating an estate plan that includes your digital currency.
Twanda Black: So let’s move to our digital accounts. My friend that passed last month, fortunately somebody was managing his account, so that they could … They put up a memorial for him, and then they deleted the account. But what happens if nobody is managing somebody’s social media or Twitter, Instagram, all of that stuff. What happens with that.
Steven LaBroi: I mean, it’s an interesting phenomenon, because I’ve seen friends of mine who have gone away. Their accounts are still there.
Twanda Black: It’s crazy.
Steven LaBroi: And every time on their birthday, it still pops up.
Twanda Black: Somebody saying happy birthday, oh my gosh.
Steven LaBroi: Yeah, yeah. People may not know. This is something that’s so much needed to understand that if you wanted your account deleted-
Twanda Black: You’ve got to tell someone.
Steven LaBroi: You’ve got to let somebody know. If your account is making money, because a lot of us have millions of followers, and their accounts are making money, which that is considered a digital asset, you’ve got to make sure you let somebody know, because somebody’s probably managing it anyway, for celebrities, for our very important VIPs, and for people who have just decided they’re going to make a living through social media, admin is a follower, somebody might be managing it for them.
Twanda Black: You’ve got to assign that, okay?
Steven LaBroi: Yes.
Twanda Black: So lets talk about the creatives, photography, logos, illustrations, images. That would be me, because I’ve got probably millions of pictures, and other little stuff, and writings and all of that. They’re online. What do I do with that?
Steven LaBroi: Yeah, usually … well, back in the day, they used to be in journals and in our notebooks, and things like that. But now, everything is digital.the key is making sure people know where your assets are, the photography, the logos. I mean, those things have claim to them naturally, because the bigger you’re a celeb, the more valuable photos are. Just heard a big story about all of these African-American photographers from the Civil Rights era, their photography, and also the magazines that we had in our group, the photography is valuable, and people are buying it. You know, illustrations. I mean, a lot of stuff holds royalties, and royalties are ongoing future payments that families can live on. It’s generational wealth.
Twanda Black: It really is. It makes me think about … You know, our beloved Jocelyn Dorsey just retired, and the Auburn Avenue Research Library is going to take her items, which I think is phenomenal. She’s bequeathed, in advance of her death, her items to this place to store, and to do a collection and all of that. So I think that’s awesome. I mean, we can’t all do that, but at least she had the forethought to be able to have her things go somewhere.
Steven LaBroi: Right, right, and a lot of times, that also lends to how they’re laid out legally, because families can benefit, museums can benefit financially from these items. And it makes for more things to think about, but at the same time, we’re living in a world where we’re massing all these huge volumes of assets, and we have to pay attention to this, because, again, in my opinion, this can lay clam to generational wealth for generations to come.
Twanda Black: Word documents, presentations, books, movies, music. You think about after-prints, and after Michael Jackson and how they have all this music which is legacy, which is money for those families. Those are all personal assets. They’re digital assets at this point.
Steven LaBroi: I mean, we’re talking about so many things, and I think we’re bringing the mind that if you pay attention, there are so many different aspects of life that are part of our asset base. Word documents, as you said, and text files. I mean, they use text messages for historical preservation for information’s sake, so we have to know what we’re putting together, because again, these will be items that’ll probably be put in museums and books written about movies into the future, this type of information, so someone has to lay claim, and that’s when you talk to an estate lawyer and start to find this out. I mean, I’ll just make sure that I mention it again, that this area of law is still pretty new. And so, it’s going to continue to evolve as we continue to create digital assets.
Twanda Black: Which we do every day. Think about your blogs, your vlogs, v-blogs, websites, all of that stuff. That is crazy when you think about, these are assets. We don’t even think about that. As we’re doing things, we’re not thinking about, “These are assets. These are personal assets.” We just don’t think about that.
Steven LaBroi: Yeah, though I see people all the time. They sell more tripods than I’ve ever seen in life, and selfie-sticks. And people are using this to create their own life story. And you just never know. And obviously, it’s also helped in a lot of instances when we see victims of crime, because that type of information is valuable to help solve some of these problems that are out there, and that becomes an asset, as well. Yeah.
Twanda Black: So, we know, from just this little piece of the conversation, that digital asset planning is necessary. Tell us why. And besides that it’s life, right now it’s life.
Steven LaBroi: Well, if you think about it, identity theft has been something that’s been so much on the horizon. I mean, obviously there are various companies that have built their fortunes on trying to help people prevent identity theft, and obviously on the other side, there are people who are trying to steal your identity. And so, they’ll steal it even if you pass away, if you don’t have this information protected, or somebody knows how to access it, where those passwords and user IDs are. And you even think about the fact that the terms and conditions that we’re faced with that a lot of us juts click the button and say, “Okay.”
Twanda Black: And we never read it.
Steven LaBroi: Never read it, never read it. They will include information about who can get access to that data, and we want know that because, again, if someone steals someone’s identity when they pass away, your family may not be able to get to all those digital assets that that person put together.
Twanda Black: Right, not without paying a large fee as they’re holding things hostage.
Steven LaBroi: Oh my God, yeah. That’s incredible.
Twanda Black: And so, when you talk about bank accounts, your jewelry, if you’ve got a lock box somewhere. All of those things that you want your family to be able to get to that, as well, and to be able to get to your things, as well. So protection from identity theft, you know the ease of being able to go through what they need to go through. And think about it. For me, being unselfish in that you have those things in place where, they’re already grieving because you’re dead, and they’ve got to go through all this drama to get to your stuff.
Steven LaBroi: Yeah, and what if someone has millions of frequent flyer miles that you can’t get to? What if somebody has, on the other side, an automated bill payment or online subscriptions that’s just tapping your bank account on a regular basis, somebody’s got to shut that stuff down in the family, or you’ll find that some of these accounts will just be withdrawn on a monthly basis, if you’ve got your mortgage being automatically paid. It’s something that, again, I would like to continue to discuss, because it’s going to continue to become prevalent in our lives, and so we just have to plan for it. It’s very important to continue to plan for it.
Twanda Black: Oh my goodness, you just, frequent flyer miles? I hadn’t thought about that. But you think about all of these different things that we have online going on. That is unbelievable.
Steven LaBroi: Yeah, it continues to become a part of our life. It’s more of a foregone conclusion that we’re going to use our smartphones and our tablets, but at the same time, who has claim over this information when we’re not here?
Twanda Black: So, first of all, in our wills, our living wills, we need to begin to list those things, as well. We need to really think about that, and begin to list those things, right?
Steven LaBroi: Yes, please, and again, it’s a very strong piece of the estate planning process, so you must see an estate planning lawyer. I encourage all of my clients not just to have a will, but to see an estate planning lawyer. If you just have one house and a bank account, at lest visit with an estate planning lawyer to have a discussion as to what that mean, because it could juts mean the difference between your family going through a whole lot of pain, and versus not having any strain at all, because these are assets that you’ve amassed over your lifetime, and we want that to stay, and we’ve seen communities change, but we want that to stay in our community. And that’s important. So remember, estate planning lawyers are your friend. I can help with directing you there. I can help with making sure we identify how the funds are transferred, but estate planning lawyers are the main play in this.
Twanda Black: And do all of them, are all of them versed in digital assets, or is that a question we need to be asking. “Hey, are you versed in digital assets?”
Steven LaBroi: What I’m finding in my research is that it’s such a burgeoning area that it’s also state-by-state, the laws. And it’s just new. And so you have to search the person who is engaged in it who can assist you with putting things in the proper place, and assist you in just making sure that you know an inventory of all the things that you’ve amassed, so you know how important they are to, again, your family and the next generation.
Twanda Black: So think about your digital assets, what they are, then list all of those usernames and passwords. That’s so crazy right there, oh my God. I have to keep them all in my phone right now, although I do have them written down on paper, and in my box, but it’s so many. It’s crazy. It’s like those little reward cards that everybody gives you in the store. “Do you have your CVS card?” ‘Uh, let me look.” Looking through 50 cards. But yeah, you’ve got to be able to do that. But providing that access in your estate planning is very, very important, so that’s why you need to go ahead and start, and really … I’m telling my 28 year old and my 30-year old that they need to go ahead and make a will. It’s never too early.
Steven LaBroi: Oh yeah, no. And it may change. It may amend as you grow and you get a family, or you start amassing more wealth. You create change to it. But it is a factor of life now. We literally have more than we’ve ever had, I think. And so, we have to pay attention to all of these aspects of our life. You know, keeping inventory can be tough, and you’re right, changing usernames and passwords all the time sometimes is just a pain.
Twanda Black: It is.
Steven LaBroi: But at the same time, what’s behind that username and password is something that’s very valuable to you, whether it’s just monetary, or whether it’s just sentimental, or else you wouldn’t have it.
Twanda Black: I want to talk about one last thing, and that digital asset protection trust. And what’s interesting about that is that who knew we had to have a trust for our digital assets? Like, you have a trust for other things, but now that’s coming into play as we become more and more of a digital society, so of course, there are going to be some rules in place. Of course, there are going to be some protections in place. So talk about what that is. They call it a DAP trust.
Steven LaBroi: Yeah, again, this is also something that’s new, but at the same time, coming on very, very rapidly, a digital asset protection trust is where you would hold your digital assets. It’s who would be in charge of the distribution, or in charge of making sure that those assets go where you want them to go. It is, again, a new name, and the cases are still very new, but at the same time, you can see how it’s evolving in all the things we talked about today, so maybe that is the thing you start with. You find out who can help you establish a digital asset protection trust, and then go from there, particularly as it relates to if you have a lot of assets that you’ve amassed through your smartphone or your podcasts, etc.
Steven LaBroi: So I really love this topic, because I think that it’s going to continue to evolve. It’s going to continue to grow. And we’re going to continue to try to find ways of making sure that we build generational wealth through the use of digital assets.
Twanda Black: That’s right, that’s right. It’s an amazing topic when, like I say, when you sent it to me, I was like, “Oh my God, I never thought about this.” Never thought about it, and it’s so interesting because that’s all we do all day, is digital.
Steven LaBroi: All day.
Twanda Black: All day. So we never think about the assets that we carry in what we do every day, and so that is something that we really need to begin to think about, especially if you have huge assets on digital. If you have your books and your movies and your whatever it is on digital, you really need to begin to consider this, find the right estate attorney for yourself, because that’s going to be really important.
Steven LaBroi: Right, and digital lasts forever.
Twanda Black: Forever and ever and ever.
Steven LaBroi: Unlike our paper photos and-
Twanda Black: It’s faded and gone.
Steven LaBroi: It’s just gone, yeah. Can be burned up in a fire. Digital lasts forever, so if you think about that, you’re really building onto your future generations. Your kinds, your grandkids, your great-grandkids can benefit from what you’re doing today.
Twanda Black: Absolutely, absolutely. This is phenomenal. Tell people how to reach out to you.
Steven LaBroi: Oh man, I love it. The LaBroiInsuranceGroup.com, Steven LaBroi, 202-544-6226, and you can reach me, those millennials, at MillennialBanking Concept.org. We do some good work with younger adults to show you money management strategies.
Twanda Black: Absolutely. Y’all smarter than us, so get it on. Save that money, and retire better than us, because we’re still working, trying to get that retirement done, right?
Steven LaBroi: Yes. Yes, yes, we’ve got to help. We’ve got to help.
Twanda Black: Chief wealth strategist Steven LaBroi joins us today from the LaBroi Insurance Group. Thank you so much for joining us.
Steven LaBroi: Thank you.