Digital Estate Planning

What Is a Digital Estate?

Today, we all have a digital life and own some digital assets. What happens to these when one dies? Well, it depends on whether or not you planned their transfer and protection, and this is where digital estate planning can come in handy.

Digital estate planning allows you to organize your digital property and decide how they are used or handled by your heirs. Your virtual and digital accounts and all associated assets make up your digital estate. These can be your social media accounts, online bank accounts, emails, and phone photos. Electronic documents and files kept online on portable devices or computers are digital assets.

Almost anything you store digitally is a digital asset and should be listed in your digital estate plan to allow your loved ones to access them once you are no longer around.

Five Steps to Plan Your Digital Estate

If you are considering digital estate planning, here are the five basic steps you can take to prepare your plan:

Step 1 – Make a Digital Asset Inventory

To begin a digital estate plan, you may first list your digital possessions. Include usernames, passwords, and account names. You can either make a printed version or store the information in a password manager.

Step 2 – Record How You Want Each Digital Asset to Be Handled

It’s crucial to specify your intentions for each asset or account to ensure your executor manages them accordingly after your death.

Review the terms and conditions of any particular companies you are dealing with. Make sure your instructions comply with them. Transfers or authorizations to access digital accounts are permitted by some businesses but not others.

Facebook permits your account to be memorialized by family members. Twitter and Google have legacy policies. With Google’s custodial tools, you can grant someone permission to access your online accounts.

If you have blogs or accounts with monetary value, decide who will run them going forward and think about having someone post a farewell to your fans.

Step 3 – Select Your Digital Executor

Your traditional executor could also be your digital executor. The majority of people pick a relative or friend. If you pick several people, make sure they can cooperate. Clarify the duties and obligations of your digital executor, and make sure they are aware of the expectations.

Step 4 – Include Your Digital Estate Plan in Your Existing Estate Planning Documents

If you already have estate planning documents, such as a will or a trust, you can elect to include your digital estate plan as part of them. You can add digital estate provisions in your will, detailing your digital assets, how you want them to be handled, and by whom. Make sure to include the inventory list and details of the password manager.

If you don’t have an estate plan, an estate planning lawyer can help you create one.

Step 5 – Store Your Digital Estate Planning Documents Safely

Your digital executor must have access to all of your estate’s paperwork. Therefore, make sure to store your digital estate plan somewhere secure and easily accessible. You could, for example, keep them on file with your lawyer.

Digital Estate Planning for Businesses

Digital estate planning is crucial for businesses. It is used to protect their digital assets, including data, software, apps, and intellectual property.

The primary goal is to ensure the company and its digital assets are preserved after the owner’s death. This is especially the case if employees have access to the company accounts and online data.

Cybercriminals are inventive. Business owners must be careful and attentive in safeguarding digital assets. The same principles apply to digital estate planning for individuals. Your digital estate plan should form part of a broader estate tax protection strategy.

FAQs

How Do I Grant Access to My Digital Assets?

To grant access to your digital assets, you can create a document listing your online accounts and login information and securely share this document with a trusted person, such as an executor or digital executor. Additionally, consider using online tools provided by certain platforms to designate a contact who can manage your digital assets in the event of your incapacity or passing.

How Often Should I Update My Digital Estate Plan?

Regularly revisit your digital estate plan at least once a year and also after major life changes like marriage, divorce, or acquiring new digital assets to ensure it remains accurate and up to date.