Emergency Planning and Inheritance
If you were in an accident tomorrow, could your family access your Bitcoin? If the answer is "no" or "I am not sure," your Bitcoin may be lost forever. An inheritance plan written today takes an hour and protects your family indefinitely.
Emergencies happen. A simple, written plan can save your bitcoin if a phone is lost, a device fails, a home is robbed, or you pass away. Keep it clear, test it with small amounts, and make sure trusted people know what to do.
Plain‑English definitions:
- •Emergency kit: A short set of instructions + where the backups are.
- •Letter of instruction: A document that explains, in simple steps, how to access funds without revealing secrets in the letter itself.
- •Executor: The person handling your affairs after death.
- •Beneficiary: The person who should receive the funds.
- •Recovery phrase (seed): 12–24 words that recreate the wallet.
- •Passphrase (25th word): Optional extra secret; seed + passphrase = different wallet.
- •Multisig (M‑of‑N): Spending needs M signatures out of N keys.
- •Time‑lock: A rule that prevents spending until a certain time.
Your 1‑page emergency plan (checklist):
1) Who to contact: Names + phone/email of 1–3 trusted people. 2) What you have: “Hardware wallet + mobile wallet,” not balances. 3) Where backups are: Location hints only (e.g., “Home safe (top shelf), Bank box #123”). 4) How to restore: “Use hardware wallet → Restore from seed → Verify receive address on device.” 5) Test step: “Before moving any large funds, send/receive $5 first.” 6) Legal: “Executor and attorney are allowed to open safe/box.” 7) Security note: “Never type the seed into a website or share it with anyone—including support.”
Simple inheritance patterns (pick one):
- •Single‑sig with passphrase: Seed in one place, passphrase in another. Executor gets both via will/letter.
- •2‑of‑3 multisig: Give 3 separate keys/backups to different locations/people (e.g., Home safe, Bank box, Attorney). Any 2 can recover.
- •Time‑delayed backup: Keep primary wallet; store a backup that can only spend after a date (CLTV/CSV—advanced; use reputable tools).
What to give people (without leaking funds):
- •Executor/attorney: The recovery process, not the secrets.
- •Trusted cosigner(s): Their own seed/passphrase only.
- •Beneficiaries: A plain explanation of who to contact and how the process works.
Keep seeds/passphrases separated; never put all pieces in the same envelope or location.
Where to store things (separate, labeled discreetly):
- •Seed phrase: Fire/water‑resistant medium (metal if possible).
- •Passphrase (if used): Different sealed container/location.
- •Descriptor/cosigner data (for multisig): Printed or on an offline USB with checksum; store away from seeds.
- •Locations: Two or three different places (home safe, bank box, trusted attorney).
- •Access: Make sure executor can legally open the locations (add to will/estate docs).
Letter of instruction (template):
1) Open the hardware wallet manual. Choose “Restore from recovery phrase.” 2) Enter the 12–24 words from Location A (see envelope label). 3) If instructions mention a passphrase, enter the exact passphrase from Location B (case/spaces matter). 4) Open the wallet app, verify the receiving address on the device screen. 5) Perform a $5 test receive and a small test send out. 6) After success, proceed with the amounts listed in the will/estate documents.
Example locator note (do not include the seed itself):
— “Seed A: Home safe, file labeled ‘Documents—December’, second sleeve.”
— “Passphrase B: Bank box #123, brown envelope ‘Travel Receipts’.”
— “Multisig descriptor: With attorney (contact in phone ICE card).”Multisig for families (2‑of‑3 quick guide):
- •Devices: Three different hardware wallets (ideally mixed brands).
- •Backups: Each seed stored separately; consider metal for long‑term.
- •Map: Write a simple map: “Savings Wallet is 2‑of‑3: Keys at Home Safe / Bank Box / Attorney.”
- •Recovery: Any two locations can recover funds following the letter of instruction.
- •Rotation: If a cosigner changes (e.g., attorney retires), move funds to a fresh 2‑of‑3 and update documents.
Common mistakes (avoid):
- •Putting the seed and passphrase together.
- •Storing everything in one location (fire/flood risk).
- •Unclear instructions (tech jargon, missing steps).
- •Never testing the recovery steps.
- •Sharing the seed or passphrase with “support” or strangers.
Regional/legal notes (keep it simple):
- •Work with an estate attorney in your country/state to reference your recovery process without exposing secrets in the will.
- •Name trusted people (executor/cosigners) and grant them access to safes/boxes.
- •Keep a printed list of important accounts (email, exchange, phone carrier) and how to lock them in emergencies.
Emergency actions (loss/theft):
- •Lost phone/hot wallet: Move funds ASAP using hardware wallet backup.
- •Suspected seed exposure: Sweep funds to a new wallet with a brand‑new seed.
- •Stolen hardware wallet: Funds are safe if PIN/passphrase are unknown—still move to a fresh wallet to be sure.
- •SIM‑swap risk: Lock carrier account; enable authenticator‑app 2FA for exchanges and email.
The plan does not need to be complex. A seed phrase in a safe, a letter of instruction with a trusted person, and a map telling your executor where to find both. Start simple, upgrade later.
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