Estate planning has long been essential for ensuring that a person’s assets are protected, transferred, or distributed according to their wishes. Traditionally, this involved managing physical assets like property, bank accounts, and personal belongings. However, in today’s increasingly digital world, a new category of assets has emerged: digital assets. These include everything from email and social media accounts to cryptocurrency, cloud storage, and online subscription services. Proper management of digital assets is now a critical aspect of estate planning, helping ensure that these items are handled according to the owner’s wishes.
What Are Digital Assets?
Digital assets encompass any online or digital property that holds sentimental or financial value. Some common types include:
- Social Media Accounts (Facebook, Instagram, LinkedIn, etc.)
- Email Accounts
- Cryptocurrency Wallets (Bitcoin, Ethereum, etc.)
- Online Financial Accounts (investment platforms, banking apps, PayPal)
- Subscription Services (Netflix, Amazon, cloud storage services)
- Digital Content (photos, videos, blogs, and other creative works stored online)
- Domain Names and Websites
These assets can have significant personal or financial value, and they often require specific handling after an individual passes. Ensuring they’re included in an estate plan can prevent loss, mitigate security risks, and spare loved ones additional stress during a difficult time.
Why Digital Asset Management Matters
Without proper planning, families may face legal or technical barriers when trying to access digital assets. Many platforms have strict privacy policies, and without specific permissions, it can be almost impossible for loved ones to access online accounts. Managing digital assets within an estate plan provides clarity and control over how they’re managed, reducing the likelihood of data loss, identity theft, or unauthorized access.
Top Priorities for Managing Digital Assets in Estate Planning
1. Inventorying Digital Assets
The first step is to make a comprehensive inventory of all digital assets. This list should include login information (username and passwords), account numbers, and any other relevant details. Consider including:
- Email accounts and primary online accounts (like Apple ID, Google, and Microsoft)
- Financial accounts that don’t offer a physical statement, such as online-only bank accounts or cryptocurrency
- Social media profiles and any media files stored online
This inventory will provide a roadmap for your executor or family to access your digital assets efficiently. Make sure this document is stored securely, as it contains sensitive information.
2. Appointing a Digital Executor
A digital executor is someone you trust to manage your digital assets. This role isn’t yet recognized in every state’s estate laws, so make sure to consult with a legal professional to clarify their responsibilities. A digital executor may:
- Delete or archive accounts according to your wishes
- Access financial accounts to pay outstanding bills or close accounts
- Transfer ownership of digital content or websites
Choose someone who is tech-savvy and understands the importance of digital privacy, as they’ll be managing sensitive information.
3. Providing Legal Access to Digital Assets
Many digital platforms have privacy policies that prevent unauthorized access, even by family members. Including specific legal language in your estate plan grants your digital executor or beneficiaries the right to access your accounts. Tools like Google’s Inactive Account Manager or Facebook’s legacy contact can allow partial account control, but these may still fall short of full access without legal authorization.
Your estate plan should specify which assets you want transferred, deleted, or accessed. Ensure the language used in your will or trust is in accordance with the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA). This act grants fiduciaries limited access to manage digital assets in line with an individual’s wishes.
4. Managing Cryptocurrencies and Online Investments
Digital investments like cryptocurrency have unique security requirements. Unlike traditional bank accounts, cryptocurrency wallets require private keys for access, which, if lost, render the assets inaccessible. To manage these assets:
- Include your private keys and seed phrases in a secure, encrypted document that only your digital executor can access.
- List any online investment accounts, along with specific instructions for withdrawal or transfer.
- Consider using a secure hardware wallet with clear instructions for accessing it in your estate documents.
5. Setting Up a Plan for Social Media and Email Accounts
Social media and email accounts hold valuable memories, contacts, and personal information. Many people choose to have these accounts memorialized or deleted upon their passing. Each platform has different rules:
- Facebook and Instagram offer options to memorialize or delete accounts if designated in advance.
- Google’s Inactive Account Manager allows you to set up an inactive period, after which your account data can be shared with trusted contacts.
Leave specific instructions for your executor on how you’d like each account handled, whether it be memorialization, deletion, or transfer to a trusted contact.
6. Securing Digital Content and Intellectual Property
Digital assets like photos, videos, eBooks, or any intellectual property should also be part of your estate plan. If you own a blog, YouTube channel, or any digital content platform, make sure to provide access and clear instructions on ownership or continuation. These assets may hold monetary value, especially if they generate revenue.
Ensuring Your Digital Estate Plan Stays Current
Digital assets can change rapidly. Remember to review and update your digital asset inventory regularly, particularly if you add new accounts or if passwords are changed. Any new crypto wallets, social accounts, or digital subscriptions should be added to the inventory. If possible, use password managers or secure digital vaults to keep these details updated and accessible for your designated executor.
As our lives continue to shift into the digital realm, digital asset management in estate planning has become a priority. By inventorying accounts, appointing a digital executor, securing legal access, and setting clear instructions for each digital asset, you can ensure that your digital legacy is handled according to your wishes. With thoughtful planning, you can prevent potential legal complications, save your loved ones from unnecessary stress, and protect your digital footprint well into the future.
Taking control of your digital assets today provides peace of mind and strengthens your estate plan. Contact us to consult with an experienced estate planning professional to integrate digital asset management into your plan.
