Estate Planning in the Digital World

Margaret-MenicucciFinancially, so few documents come through the regular mail box anymore.  Banks and investment institutions encourage us to receive statements electronically, manage our accounts online, and even “deposit” checks with a few clicks of our smart phones.  Our online banking and investment accounts are “digital assets.”  Digital assets  also include so much more:  our online shopping accounts and tax preparation accounts; our e-mail accounts and social media accounts like Facebook and Twitter; and our digital storage like cloud services and photo-sharing services.  For the technically more sophisticated, digital assets include domain registrations, web-hosting accounts, blogs, and software licenses.  So how do we ensure that these assets are managed according to our desires if we become mentally incapacitated or die?

Good planning for digital assets will require three things:   organization, communication, and authority.    You can create an inventory of your digital assets just as you inventory your physical assets.  That inventory likely needs to include usernames and passwords.   Consequently, this planning step feels contradictory to the steps we take to keep our digital assets secure.  You have to find the balance.  A list of digital assets needs to be kept in a secure place and updated regularly.  As with all estate planning, communication is key.  Our loved ones, or our personal representatives, need to know what is important to us.  They need to know where how we keep our assets and how we keep that information safe.  They need to know what we expect them to do with these digital assets after we are gone.

Finally, authority helps your loved ones manage the maze of institutions that may control your digital assets. Facebook now has created a “legacy contact” –  a person who can download the deceased user’s photos and can draft a memorial post.   At Braun & Gresham, we include authorization to control digital assets in our estate planning documents: the powers of attorney and the wills and revocable living trusts.  This planning provides clarity to your family and personal representatives.  It allows them to address the various institutions controlling your digital assets with authority, so they can work faster to protect and manage your estate.

 

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