Living in a digital age, it is hard to find an area of our lives that has been left untouched by the changes that have occurred over the last 20 years with the explosion of the internet. Our ability to carry around smartphones and tablets provides us with immediate access to all things digital.
These changes enable us to share our lives with the outside world through social media outlets like Facebook, LinkedIn and Twitter. But what happens to your social media accounts when you become disabled or die? What about those 750,000 frequent flyer miles you have accumulated, the loyalty points on your credit card or your catalog of songs on iTunes?
You may have heard questions like these addressed in the media recently because they have become an area of tremendous frustration for grieving loved ones left behind trying to access a Facebook account so they can capture the last few pictures or posts of their loved ones. It also presents challenges for trust officers trying to gather the assets of a deceased person to settle their estate. Trustee documents or Executor paperwork don’t always supersede the restrictive privacy agreements that providers of digital and social media have in place with the decedent.
While many people know the importance of having an Estate Plan, planning for access to and the disposition of digital assets has been, until recently, widely overlooked. Chances are if your estate plan was prepared more than 5 years ago, it is silent on the topic of digital assets. Preparing or amending your estate plan is about as desirable as getting a root canal for a lot of people. However, because every corner of our lives is somehow touched by digital assets, this is an area that you cannot ignore. None of us know when the unexpected may happen. When it does, wouldn’t it be better to ensure a smooth transition for those left behind, and ensure that the assets you have go where you intend? Planning ahead can help.
Where to start?
You should begin by compiling an inventory of your digital holdings. These include:
- Bank and investment accounts
- Credit cards
- Email accounts
- Social media accounts
- Digital media accounts like YouTube and Shutterfly
- Services like PayPal, eBay, Netflix and Amazon
- Financial services like Quicken, Turbo Tax or Mint
- Service providers like your physician or CPA
Once you have completed your inventory, you will need to document log-in details and passwords for each site. Including answers to frequently used security questions for your accounts is also important as many sites will require a correctly answered security question if logging in from an unrecognized device.
Ask yourself some questions:
Who do I want having access to things like my emails or other electronic communications such as WhatsApp or texts?
Who do I want having access to my online photos via Apple or other such cloud-based photo storage sites?
Consider as well what assets you have digitally that are of value in your own right — and make sure your counsel knows about it as you may have to specifically ensure it’s properly treated under your estate plan. For example, have you monetized any social media, such as an Instagram account? Do you play online games that may have some actual digital currency or “assets” that are tradeable within the game? Do you have a blog?
If you do happen to own any cryptocurrencies, please let your counsel know. Cryptocurrencies may need to be separately identified in your will or estate planning documents to ensure that any cold or hard key, written on a piece of paper or on a thumb drive, is identified to an executor and is not treated as the personal property that is not necessarily distributed in accordance with your other assets in your estate. There are already many horror stories of fortunes being lost because executors or other well-meaning folks in clearing out offices or houses post-death have thrown away keys.
In addition, if you use the cloud to store your information, you should create a back-up to an external hard or flash drive. Again, consider who you would like to access that information, and if any of it has intrinsic value.
Planning your digital will
Once you have compiled your inventory, you will need to decide who will be the holder of this information. Attorneys are now preparing digital wills for clients in addition to traditional wills. A digital will sets forth who will have ownership of, access to and control of the assets listed on your digital inventory. We have also recently seen language included in powers of attorney granting a person’s agent access to digital assets and accounts in the event the principal becomes incapacitated. Having both a power of attorney with this language and a digital will ensures that the person you chose will be able to access your accounts and information when needed. Ensure that your counsel understands all of your potential online and digital accounts and assets, including if you have opted for legacy identifiers or master password accounts.
Keep in mind that wills are probated at a person’s death and placed on file in the courthouse, which makes them accessible to the public. For this reason, you should never include the digital inventory with your will or include the account and password information in your will. It should be a separate document that is kept in a safe and secure location.
While some states are passing legislation to deal with digital assets, the laws vary by state and are not necessarily comprehensive. Currently, the best way to ensure that your loved ones will be able to access your accounts is through thoughtful planning and preparation of a digital inventory, power of attorney, digital will, and use of online tools such as legacy designations.