Most people do not think about the large digital footprint that they have created. More importantly, they do not think about how their digital assets might pass (or not) at death. Since these assets may have value, either financial or sentimental, planning for them may be more important than you think.
What are digital assets? Legally, they are property stored or existing exclusively in digital form. These assets are:
- Personal assets such as digital media and photographs.
- Financial assets such as bank accounts, PayPal accounts and the like.
- Business assets-domain names.
- Social Media such as Facebook, Instagram, etc.
These digital assets may have independent monetary value, personal value, or provide critical information.
Assets with monetary value include domain names, PayPal or retail accounts with stored value, purchased media (movies or music), virtual currency and game assets and loyalty programs. Assets with personal sentimental value will include digital photos and home movies, blogs and Facebook pages. Assets with informational value may be the most important. These can include electronic bank and financial statements, e mail accounts, online sales records and Turbo Tax and Quicken files.
There are a number of reasons to include these digital assets in your will and estate plan. First, you want to make sure all of this property is taken into account. Second, you may want some or all family members to have access to photos and media. Third, estate representatives and family members will have a need to access important data. Fourth, you want to reduce the risk of identity theft on stale accounts. Finally, you may want to keep information private.
There may be state and federal laws and contracts with service providers impacting access to information by survivors. Having said this, there are several steps one can take in the planning process to protect the succession and access to these digital assets.
- Create an inventory of digital assets:
- Computers and smart phones. Inventory and secure the assets in a safe place or on a thumb drive. Also, periodically update.
- E-mail addresses and passwords. Use software that saves and stores passwords. In addition, familiarize yourself with rules for e mail providers.
- Social networking profiles. Understand the rules of service providers.
- Domain names and webpages.
- Online financial information.
- Digital photos and media accounts.
- Other online accounts.
- Prepare a plan that effectively transfers digital content and assets.
- Leave a virtual assets instruction letter with a list of digital assets and accounts.
- Make sure that wills, powers of attorney and family trusts have specific language and authority to deal with digital assets.
- Specific instructions to consider:
- Seek technical assistance;
- Consolidate accounts on as few platforms as possible;
- Obtain statements;
- Change passwords; and
Remove personal data.