Estate planning is usually focused on designating who will inherit your personal physical assets and belongings when you die. However, in the modern age, digital estate planning has become an important consideration for many individuals.
If you currently have digital assets, including social media accounts, email accounts, online financial accounts, apps, websites and blogs, and software subscriptions, you may want to include these in your estate plans. By doing so, you can designate who will be responsible for managing, distributing, and/or deactivating those digital assets after you’re gone.
Below is an overview of what to consider when creating a digital estate plan.
Why does digital estate planning matter?
Today, it’s extremely common for people to manage the majority of their finances, business and personal lives online, but few people have their digital accounts organized or centralized for easy access in the event of their death.
With a proper plan for the post-mortem management of your digital assets, you can make it easier for your future executor to settle your affairs. For instance, if your executor receives the login credentials for all of your financial accounts and creditors when you die, that person can instantly get an idea of what you might owe and how much money you have to distribute to your beneficiaries – without having to call up each bank and submit a death certificate to receive copies of your final statements.
From a more personal perspective, your executor would also be able to log in to your email and social media accounts to inform your digital connections of your passing. From there, they can take action to either “memorialize” your profile (as Facebook allows you to do), or deactivate your account to protect your digital memories.
Steps for creating a digital estate plan
Like traditional estate planning, digital estate planning is the process of cataloging, organizing, and planning for the disposition of your digital assets after you pass.
There are several steps you can take to prepare your digital assets to be properly transferred before your death.
1. Record all digital assets, their respective passwords, and storage locations.
The first thing to do to prepare your digital estate plan is to keep a complete list of your digital assets. If your digital assets include social media accounts, such as Facebook or Instagram, or email accounts, be sure to review the terms of service for instructions for any asset transfer restrictions.
2. Decide what you want to happen to your accounts when you die.
Do you want everything on your computer deleted when you die? Would you want certain files to be saved and distributed among your loved ones? Whatever your desire, leave specific instructions in your will for what should happen to each of your digital assets. Typically, this becomes the responsibility of your executor, but if you wish to have someone else handle the digital portion of your estate, you should spell this out as well.
3. Save files on your computer(s) to an external drive.
Once you have your accounts in order, save all assets stored on your computer onto something tangible, such as an external hard drive, and store the hard drive in a safe place. You may also wish to back up your files to a cloud-based storage solution, in case the hard drive is lost or damaged. This is a good practice to follow throughout your lifetime to ensure you never lose access to your most important files.
4. Update your list of digital assets whenever necessary.
While compiling your initial list is a good first step, keeping your list of digital assets up-to-date is also important. Be sure to let your closest family members know what’s on your list of assets, so they can be as prepared as possible when they review your estate plans after your death.
5. Have an attorney prepare an updated Power of Attorney, Will, or Trust.
Lastly, many states, including Virginia, have adopted official statutes addressing digital assets. Make sure to have an attorney update your existing estate planning documents to empower your attorney-in-fact, executor, or trustee to act on your behalf and on behalf of your estate during a period of disability or after your death.
Contact an experienced estate planning attorney for help
If you need some guidance, an experienced attorney can help you create or update your will, powers of attorney, trusts, and other appropriate estate planning documents.
The Law Office of Patricia E. Tichenor has been serving the estate planning needs of Virginia residents for nearly 20 years. Contact us to discuss your circumstances and how we might be able to help you plan for your family’s future.