Avoid unnecessary headaches by keeping digital assets in mind when planning for your estate.
Digital assets include any content or electronic information stored on a computer or through computer-related technology – such as financial accounts, social media and email accounts, Word documents, PDFs and music. In fact, McAfee has estimated that individuals own an average of about $35,000 worth of digital assets. Not planning for the distribution of these assets in an estate plan could be a significant oversight, and may also lead to legal complications for loved ones down the road.
Individuals and estate planners can avoid unnecessary headaches by keeping these considerations in mind when accounting for digital assets and accounts.
Identify your digital assets. Keeping a record of all your digital accounts, including passwords and login information as well as security questions and answers, could be greatly helpful for fiduciaries and loved ones. Update your list regularly, and either use proper encryption if storing digitally or keep it in a secure physical spot, such as a safe.
Review your online providers’ policies. They may have “terms of service” that would prevent spouses or loved ones from accessing important information without undergoing complicated legal proceedings. Whether attempting to pay a bill online, delete an account, or use an app on a shared device, not paying attention to the fine print could create complications following an individual’s passing.
Consider current digital asset laws. Under the Uniform Fiduciary Access to Digital Assets Act (UFADAA) currently enacted by 24 states, fiduciaries of an estate have legal authority to access a decedent’s digital assets. At the same time, fiduciaries are barred from accessing electronic communications unless specifically stated in a will, trust agreement, power of attorney or other legal record.
Formally document your digital asset wishes. Estate planning documents should include clear disclosure of your wishes for your digital assets, including stated permission to access your accounts, disclosure of the location of the inventory list mentioned above, and specific instructions for the administration of your digital assets and accounts.
