At first thought, I didn’t think I had any concerns about planning for digital assets. Think again. Social media, digital photos, and online banking and investment accounts are much more common.
You may think having a will and perhaps a trust or two is all you need for your estate plan to be complete. However, if you do not also have a “digital estate plan,” your online life, from emails to financial accounts, may live forever and leave your estate and your heirs vulnerable to identity theft, says a recent article from Consumer Affairs, “Your digital legacy could be exposed after you die.”
Please do not feel guilty since most people age 65+ are completely unaware of their digital legacies, while 75% of millennials have a digital executor in their wills.
The problem is that if your executor cannot identify and access your digital assets, they may be left online in perpetuity. They could be accessed by thieves who know more about navigating the web and selling stolen assets than you or your heirs.
You could leave your digital legacy to fate. However, it would be far better to be proactive by creating a digital estate plan. This also reduces the chances of your heirs quarreling over your intentions with digital assets, just as your will and trust do for traditional assets.
Start with an inventory when planning for digital assets. List all your online accounts, websites where photos are stored online, social media profiles, and all other files. You should then document all your login credentials, passwords, and security questions for each asset. You may wish to use a password manager to organize and encrypt the information.
Ensure your executor and heirs know what you want by providing clear instructions in a document like a Letter of Intent. when planning for your digital assets. This is not legally enforceable. However, it can convey your wishes properly. Be sure that the right person or people know where your digital assets inventory is located.
Remember, you do not want the inventory of assets in your will since it will become part of the public record when the estate goes through probate. However, you do want it documented and accessible.
Make it legal and secure. Most states have adopted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which gives trustees the right to access and manage digital assets after the owner’s death or incapacity.
Talk with your estate planning attorney about how your state’s laws address digital assets and what actions you will need to take.
Reference: Consumer Affairs (Dec. 18, 2023) “Your digital legacy could be exposed after you die”
