When Rachel’s grandmother passed away, she was surprised to learn that her Grandma had a Facebook account and even shared YouTube videos before her passing. Rachel could not manage the accounts and their digital memories without a digital estate plan. Now, Rachel is engaged in Digital Estate Planning, ensuring that in the event of any unforeseen circumstance, her family can easily access her online accounts.
Introduction
Before we begin, I want to clarify that I am not a legal professional, and what follows should not be considered legal advice.
What is Digital Estate Planning?
So, what exactly is a digital estate plan? Simply put, it is preparing to manage your digital assets and accounts in the unfortunate event of your death or incapacitation. Managing your digital assets includes making important decisions about who should access your online accounts and services, such as social media networks, email providers, and cloud storage platforms if you can no longer make those decisions due to a medical condition or unfortunate demise.
Why Digital Estate Planning is Important
Digital Estate Planning is important for many reasons. Not only does it help ensure that your assets and accounts are managed as you wish, but it can also protect your online presence and data from being accessed by unauthorized individuals after death or incapacitation. It can also spare your loved ones the frustration of trying to gain access to information without proper documentation.
Digital Estate Planning also lets you keep your digital assets up-to-date and organized. By creating a plan now, you can ensure that your accounts will be managed appropriately in the future. It also enables you to make important decisions about who should access what information and how they should use it after you’re gone.
Finally, Digital Estate Planning also gives you the peace of mind of knowing your digital assets will be taken care of if something happens to you. No one likes the thought of their online presence and data being left in limbo after death or incapacitation, but Digital Estate Planning can give you, and your loved ones, a sense of security.
Creating a Digital Estate Plan
Creating a Digital Estate Plan requires careful consideration of your digital assets and the decisions you make about who should access them in the event of death or incapacitation.
The first step is to inventory all your digital accounts, passwords, and other relevant information, such as account numbers. The inventory will be a reference document for your executor or agent to use during your death or incapacity.
It would help if you also considered making a will and Power-of-Attorney (POA) that outlines your wishes for managing your digital assets and accounts. The will should include who should have access to which accounts and any instructions you may have about what should be done with them. It’s important to keep this document up to date so your wishes can be easily followed without confusion.
It would help if you also considered setting up an authorization system, such as a digital will or trust and POA, to make sure that only authorized individuals have access to your digital assets after your death or incapacitation. This system can help you ensure that the right people can manage your accounts and data per your wishes.
Finally, you should ensure that digital assets or accounts are backed up and stored securely. Backing the assets up will help ensure that all your data is available for those who need it in the event of death or incapacitation.
Step 1: Inventory and Backup
What Constitutes a digital asset?
Digital assets are any information that is stored in digital form. These assets include documents, photos, music, videos, websites, and social media accounts. Digital assets can also include financial information such as bank statements and account numbers. Essentially, anything you have an online presence for can be considered a digital asset.
Take an Inventory
Again a digital asset can be anything stored electronically, such as photos, documents, songs, and emails. Do not forget about bank statements and account numbers. It also includes accounts on websites or social media networks. Anything you want to keep safe should be included in your inventory of digital assets.
Tips for Organizing Your Inventory List
Once you’ve compiled an inventory of your digital assets, it’s essential to organize them to make it easy for your executor or agent to manage them. Start by writing down the username and password associated with each asset. Additionally, provide instructions on accessing the account or where the backup data can be found.
It’s also a good idea to keep the list up-to-date. Anytime you create new accounts or passwords, make sure to add them to the inventory list. Additionally, it’s important to store the list in a secure location, such as a safe deposit box or encrypted file.
How to Back Up Your Digital Assets
Backing up your digital assets is integral to creating a digital estate plan. It’s essential to ensure that all of your data is safe and secure in the event of death or incapacitation.
Cloud storage services such as Dropbox, Google Drive, or iCloud are some of the best ways to back up your digital assets. These services offer secure, encrypted storage options that make it easy to store and access your data online.
If you want even more security, you can use an external hard drive or USB drive to back up your data. Physical storage is an excellent option if you don’t want to rely on cloud services or prefer not to have all your data in one place.
In addition to physically backing up your data, you should consider taking the extra step of encrypting it. Encryption will help ensure that any sensitive information is kept safe and secure in the event of death or incapacitation.
Step 2: Decide Who Should Inherit Your Digital Assets
How to choose a Custodian/Trustee for your Digital Assets
Choosing someone you trust is essential when deciding who should manage your digital assets after death or incapacitation. This person should be responsible and have the technical knowledge necessary to access and manage your accounts. Additionally, they should understand how to handle sensitive information per your wishes.
Before choosing a custodian or trustee for your digital assets, it’s important to talk to them and make sure that they understand what they are responsible for. Make sure to discuss any specific instructions you may have on how the accounts should be managed in the event of death or incapacitation. Choosing someone familiar with technology and knowledgeable about internet security is also wise. A wise choice will ensure your digital assets are kept safe and secure.
Finally, choosing someone who can be trusted with the sensitive information often associated with these accounts is important. Sensitive information could include things like passwords or credit card numbers. It’s important to make sure whoever has access to this information understands the importance of keeping it secure.
Steps to Take to Transfer Ownership of Your Social Media Accounts
Transferring ownership of your social media accounts is essential in creating a digital estate plan. Depending on the platform, there may be different ways to do this.
For example, using Facebook, you can designate a legacy contact to manage your account after you’re gone. You can also use the “Memorialize” feature, which allows your account to remain active but will not allow any new posts or updates.
It’s key to ensure that instructions for managing your social media accounts are communicated to the chosen custodian or legacy contact. Additionally, make sure that any passwords for these accounts are stored in a secure location and made available to them so they can access the accounts as needed.
Step 3: Prepare a Detailed Will
What Should Be Included in a Digital Estate Plan?
A digital estate plan should include a detailed will that outlines how your digital assets should be managed after death or incapacitation. This document should consist of instructions for controlling any existing accounts, as well as information about creating new ones if necessary.
The will should also designate the custodian or trustee who will have access to the accounts and manage them according to your wishes. It’s important to include detailed instructions about managing the accounts, including any passwords or other sensitive information necessary to access them.
Additionally, the will should include information about digital assets that may need to be transferred or sold after death or incapacitation. These assets could be anything from domain names and websites to social media accounts.
Finally, the will should include instructions for what should be done with any remaining digital assets. The instructions could include deleting, archiving, or transferring them to someone else. It’s important to ensure these instructions are clear and detailed so your executor can easily follow them.
How To Write and Store Your Will
Writing and securely storing your will is important to ensure that your digital estate plan is legally binding. Using an attorney or legal professional when writing the document is best to ensure everything is done correctly.
Once the document has been written, it should be stored in a safe place, such as a home safe or encrypted file. It’s also important to ensure that the executor of your will knows where the document is located and how to access it in case of death or incapacitation.
Creating a digital estate plan can seem daunting, but these steps can give you peace of mind knowing that your digital assets are taken care of. By taking the time to research and plan, you can ensure that your digital assets are managed according to your wishes.
Additional Tips for Establishing an Effective Digital Estate Plan
Creating an effective digital estate plan doesn’t have to be complicated. Here are some additional tips for ensuring that your digital assets are taken care of:
- Make sure to update your will regularly, as technology and platforms change frequently.
- Consider setting up a trust to manage your digital assets if you don’t want to designate a specific person or group.
- Consider setting up automatic payments for any online services you may use to ensure that they are continued after death or incapacitation.
- Ensure your passwords and other sensitive information are securely stored and available to the designated custodian.
- Think about how you would like your digital assets handled in the event of death or incapacitation. Consider any messages you might want to leave behind and any accounts that should be memorialized or deleted.
Following these tips ensures that your digital assets are managed according to your wishes, even in death or incapacitation. Taking the time to plan will give you and your loved ones peace of mind.
Conclusion
Recap of the Three Things to Remember for Digital Estate Planning
Creating a digital estate plan ensures that your digital assets are cared for after death or incapacitation. There are three key steps to establishing an effective digital estate plan. You should take:
- Choose the custodian who will manage your accounts and make sure they understand their responsibilities.
- Ensure a smooth ownership transition for your social media accounts and other digital assets. It is crucial to provide clear instructions and guidelines to avoid any confusion.
- Prepare a detailed will outlining how you would like your digital assets handled.
Following these steps, you can ensure that your digital assets are managed according to your wishes, even after death or incapacitation. Taking the time to plan can give you and your loved ones peace of mind.
Suggestions For Further Research on Estate Planning for Digital Assets
Creating a digital estate plan is important in protecting your digital assets. If you’re interested in learning more, many resources are available to help you understand the legal and technical aspects of estate planning for digital assets. Here are some suggestions:
- Read up on the laws governing digital estates in your state. Doing this will ensure that your digital estate plan is legally enforceable.
- Research options for online storage solutions that securely store passwords and other sensitive information related to your digital assets.
- Contact a qualified attorney who specializes in digital estate planning. A qualified attorney will ensure you create an effective and legally binding document.
- Join an online forum or support group to exchange ideas with other individuals interested in estate planning for digital assets.
By taking the time to research and plan, you can ensure that your digital assets are taken care of after death or incapacitation. Understanding the legal and technical aspects of estate planning for digital assets will give you peace of mind knowing that your wishes will be honored.
Resources for Estate Planning Assistance
If you’re feeling overwhelmed by the estate planning process, resources are available to help. Here are some organizations and services that can assist:
- The National Association of Estate Planners & Councils (NAEPC) is a nonprofit organization dedicated to helping individuals navigate the estate planning process. They provide information on professional advisors and other resources related to estate planning.
- LegalZoom offers online legal services to help individuals create a will and manage their digital assets. Please be aware this does not serve as a replacement for competent legal counsel.
These resources can help you create an effective digital estate plan to ensure your wishes are honored after death or incapacitation. Doing adequate research and seeking qualified professionals is essential to be confident in your estate plan’s validity.
Author
Isaac is a Fee-Only (no products sold) Certified Financial Planner® Practitioner. Isaac founded Stalwart Financial Planning with offices in Fayetteville NC and Durham NC. Isaac provides comprehensive planning and investment management services to individuals from all walks of life. Isaac can be reached by phone at 910-867-8464, or by email (iallen@StalwartPlanning.com). Visit him at Stawart Financial Planning www.StalwartPlanning.com.