July 26, 2021
In today’s digital age, electronic devices, online accounts, and cloud storage are inescapable parts of every day life. The challenges and stay-at-home orders of Covid reinforced this reality even more over the past 17 months. Our lives are intertwined with digital assets like never before. Credit cards, mortgages, bank accounts, investments, and more all rely on electronic devices, online customer accounts, and data stored in the cloud. Social media only adds to the mingling of our days with everything online.
Consider What Happens When You Pass Away
Prior to his passing, Leonard Bernstein had written a memoir that was password protected. No one was able to access his memoir. He had not given the password to anyone. Although most of us won’t be producing a memoir, many of us have photos, text messages, and emails that will have deep meaning to those we leave behind. Access to those digital family treasures can be important. Not having to go through a social media company’s or email service provider’s policies or legal channels can help make your estate planning attorney’s job a bit easier. In some cases, that can also save you legal fees and costs.
Give Yourself Peace of Mind
A properly crafted estate plan can give you peace of mind, knowing your assets and family are well protected. Our estate planning lawyers will help you get there.
Who will have access to your electronic devices or social media accounts if you become incapacitated or pass away? Will your trusted loved ones or legal representative know where to find your asset information and account statements? Do you want them to have access to certain financial accounts or social media sites without having to go through legal formalities? Will assets go missing and never be located if no one knows about them?
The Good News: We Access Most Digital Accounts and Assets
We can typically locate assets of incapacitated or deceased persons through account statements, tax returns, tax information such as 1099s, and over time through mail. However, it is a lot easier if there is a list of assets available or a file with printed account statements available.
That said, where there are digital assets that do not generate mailed statements or do not result in 1099s, such as online bank accounts or cryptocurrency, it can be difficult to locate these assets. Even if others know of the existence of these assets, will your legal representatives know your usernames and passwords? Will your legal representatives be able to access these online assets? For example, cryptocurrency may be unrecoverable if passwords or digital private keys are unavailable.
Start Planning Today
We suggest that you keep a list of assets or account statements in a place where a trusted loved one knows where to find them or with your estate planning documents. Even the name of the bank or investment company and type of account will help locate an asset in a timely manner.
We also suggest that you update this information at least once per year. Be sure to include social media accounts, device passwords, and financial assets that do not generate mailed statements.
With data breaches in the news on a regular basis, we advise our clients to use caution and follow best practices so as to keep your statements and passwords safe.
Don’t Forget Digital Assets like Photos and Videos
Will anyone be able to access your computer or phone if you pass away? Do you want someone to be able to access your electronic devices so that all your photos and videos, taken over years, are available to your loved ones? Making sure that your legal representative has the usernames and passwords to access your electronic devices and accounts is important, so that your children, grandchildren, and beyond can access, save, and cherish those digital memories.
For our experience, the process of gaining access to these important items without usernames and passwords can be time consuming, costly, and in some cases, impossible.
Clarify How to Handle Social Media and Email
You may want your loved ones to have access to social media accounts or email accounts. You may want to give instructions to delete certain social media accounts, to keep them active, or to post an update on your condition. Letting loved ones know what you want can make it easier for them to follow how you want these type of personal matters handled.
What To Do: An Action Plan to Log Digital Assets
- Identify and List: Identify all of your assets and make a list or keep statements where a loved one or legal representative knows where to find them. Keeping this information with your estate planning documents is often the best practice. Update your list regularly, but at least once a year. Tax time is often a great time to update, since you will be gathering up financial information anyway. Don’t forget about assets which don’t have statements mailed such as online bank accounts, online investment accounts, some life insurance, and cryptocurrency. Make sure that these assets are accounted for on your list.
- Don’t Forget about All of Your Digital Assets: Consider listing items such as online bank and investment accounts, online retirement accounts, email accounts, social media accounts, domain names, cryptocurrency, money transfer apps, online photo storage, cloud storage accounts, iTunes and stored music, movie accounts, health accounts, online memberships, streaming services such as Netflix, cash accounts such as PayPal and eBay, money transfer apps such as AppleCash and Venmo, and more. Again, it will be much easier to manage these accounts if a trusted loved one or legal representative can follow your list to identify and easily access these items.
- Passwords and Multi-Factor Authentication: If you use a password management app, consider making sure that a loved one or legal representative knows where to find the password and access the app? If you use multi-factor authentication such as using verification codes sent to an email or phone, will your loved one have access to your email or phone? Don’t forget to note your phone pin number.
- Social Media: Set out your wishes regarding social media accounts and how you would like them handled if you were incapacitated or deceased. Writing clear instructions how to handle items like your Facebook account will help ensure your loved ones and legal representatives follow your wishes.
We Are Here to Help
As estate planning attorneys, we regularly remind our clients that estate planning is an ongoing and long-term process. We invite you to make sure that you have a plan for handling all of your digital assets. We welcome the opportunity to work with you on this and invite you to contact us to discuss estate planning options.