Making an Estate Plan? Don’t Forget Your Digital Assets

September 10, 2018

iStock-892797264_700x400

The digital revolution has enriched our lives in many ways. We can stay in more frequent contact with family across the country, meet new friends around the world, enjoy the convenience of online banking, and buy practically anything we need without leaving the home.

Yet as our lives become increasingly digital, we need to make sure that we have a plan for after we pass. Your loved ones may not be able to access your online financial accounts unless you leave detailed information. They may not even be able to access more personal items, like your family photos.

Even if they know where to look, they may not be able to gain access to an account unless you list out the information in advance. Leaving them to contact the digital provider for access may put them in legal limbo, unable to download those photos or pay your final bills.

Don’t Depend on Legislation

The federation government has yet to pass legislation on accessing digital media. That has left the states to pick up the ball, with the majority of states having enacted what’s called the Revised Uniform Fiduciary Access to Digital Assets Act.

The law is meant to give executors and other fiduciaries the means to access the digital assets of someone who has died. However, the executor can face hurdles even with the law—among them, restrictions on electronic communications such as email and social media accounts.

Such restrictions are meant to protect the decedent’s privacy; however, if you want your executor or someone else to be able to access an email account, for example, you will need to state it in your estate plan. 

What Should You Do?

It is important that you take care of your digital life just as you would your more tangible life. Here are some steps you can consider taking:

  1. Take an inventory: Make a list of every financial account, email provider, social media account, photo storage site, and any other account important to you and your heirs. Detail in writing your wishes for each account, whether it should be cashed out, closed down, or left online as a memorial, like Facebook allows.
  2. Talk to your estate planning attorney: Share your list with your attorney to determine the most appropriate legal method such as a will or trust to carry out your wishes.
  3. Secure your inventory. Unless your attorney advises otherwise, you will want your executor to be able to access your accounts after you pass. You may want to place the information in a safe deposit box or with your financial planner or attorney. You could also use an online password manager, although you will need to ensure that your executor will be able to obtain the username and password for the password manager.
  4. Keep your information up to date. If you change a username or password, note it. If you open a new account, note that as well. Having an outdated inventory could leave your digital estate in as much limbo as having no inventory at all.

Summary

No doubt, the laws on digital assets will be refined in the years to come. In the meantime, you can take steps to leave the legacy you want with an estate plan that includes your virtual life. If you need help updating or even starting your estate plan, a financial professional can help provide recommendations based on your overall situation. Please reach out to us—we’d love to help.

Recent Posts