The growth of the tech industry and our increased dependence on digital and online tools means your 21st-century estate plan needs to accommodate digital and online accounts. While a thoughtful, detailed estate plan should have what your executor needs to gain access to your digital accounts as needed, a digital estate plan makes their life far easier.
As you begin to make your estate planning checklist, begin to think about all of the online and digital accounts you access to include in your estate plan. While this post provides general guidelines
What is a Digital Estate Plan?
Your digital estate plan encompasses anywhere you have a digital or online presence. All of these are considered digital assets.
This includes things like:
- Personal or professional website (for this post, we’ll focus on personal digital estate, but business owners should be conscientious about business/professional digital estate planning needs).
- Social media accounts.
- Photo/video storage accounts.
- Financial accounts.
- Utilities, cell phone(s), insurance carrier accounts, etc.
- Retirement accounts.
- E-commerce and marketplace accounts.
- Work/social platform memberships.
- Credit card accounts.
- Cryptocurrency accounts.
- Cellphone apps.
- Online gaming apps.
- Dating apps.
- Online social/political forums.
- And so on.
In some cases, depending on the value or sensitivities associated with the accounts, you may want to designate a separate executor to handle digital assets.
Defining Digital Assets
The term asset means something a bit different in the digital context. It represents a digital or online account that requires some type of action after death, or in case you become incapacitated. Therefore, digital assets are an account’s online presence, but not necessarily representative of the account’s content.
So, for example, while your IRA or 401k plan may be digitally accessed by you online (a digital asset), the actual funds are not digital assets. They are traditional assets and will be included as such in your complete estate plan. In that case, odds are your primary estate plan executor will have access to those accounts’ usernames/passwords (even if they receive them from your separate, designated executor for digital assets).
In the meantime, socially-oriented digital assets, like social media accounts, may need to be maintained for a set amount of time. You may opt to have them immediately closed. Once you’ve listed your assets, begin thinking of how each would be accessed, maintained, closed, distributed, etc.
List all of your digital and online accounts
Anything that requires a computer/smart gadget, a username, and a password falls into this category. Most of our clients are amazed at how many digital assets they have once they start this process.
This is rarely a one-and-done exercise. We recommend keeping a spreadsheet you continually add to for a few weeks or months. This living document can be added to and amended as you go along, providing a real-time record of your digital assets, usernames, and passwords.
Whenever you’re asked to change your password for a specific account, or when you intentionally change one, access your spreadsheet and change it there as well. By making this a habit, you ensure the record is up to date, easing the way for your digital estate plan executor when the time comes.
Think about who you trust to have access
Our digital lives are protected, hence the fact that they’re almost always guarded by username and password protection. Some accounts, depending on their sensitivity or vulnerability to scammers—like financial accounts—may have additional security measures in place. Therefore, it’s important to be careful when selecting who can access them—whether that be your overarching will/trust executor or a specific digital estate executor.
Sometimes, having your executor be your eldest child or sibling might make sense. However, be wary of “traditional” choices. As experienced estate planning lawyers, we’ve learned that a person’s character, intellectual abilities, and objectivity are almost always more valuable than their proximity of relationship to you. Objectivity and a responsible, trustworthy character ensure things get done as dictated by the estate terms and as per probate law.
Work with an estate planning attorney
We do not recommend creating a DIY estate plan. While a DIY will may work in an emergency situation, it is also the least likely to be complete and the most likely to be contestable if relatives take issue with what is stated there.
Instead, consult with a fee-based estate planning attorney. Even a single consultation will feel invaluable as we outline exactly what you need to organize your legal affairs and digital estate plans. If it feels like a good fit, you can schedule further sessions or learn more about single-fee packages that can get your estate plan finalized and legally filed.
Revisit (and revise) digital estate plans regularly
We consider estate plans to be living documents and should be revisited regularly – annually is a best practice – to ensure everything is relevant. While we recommend this for all wills, trusts, and other aspects of estate planning, it’s especially poignant for digital estate plans.
Most financial or highly protected accounts request password changes regularly. This means your passwords change more frequently than you revise your estate plan. Again, we recommend using a spreadsheet to track all username/password-protected accounts and establishing a disciplined approach to making those changes in real-time so they’re always current.
If you feel a Google or Excel spreadsheet is too vulnerable, there are several online options for secure password storage. Click here to learn more about some of the best password managers.
Begin Protecting Your Digital Estate With a Consultation at Tseng Law Firm
Tseng Law Firm can help you protect your digital estate in a single consultation. Contact us to learn more about our services and how we integrate digital estate planning strategies into our comprehensive estate plan services.