When creating an estate plan, you likely already know to include the basics; a will or trust, beneficiary forms, power of attorney, a living will, and a letter of intent. You have a plan for your house, your car, savings, stocks, and much more, but what about a plan for your assets that exist only in the digital world?
As technology continues to rapidly evolve, more and more aspects of everyday life move partly or entirely online, as a result traditional estate planning and probate laws struggle to keep up. To fully ensure the safety and security of your estate, you need to make a plan for both digital and physical assets.
YOU HAVE DIGITAL ASSETS…
Digital Assets are any content related to, created by, or owned by you that exits online. This includes personal online accounts of any kind, with and without monetary value, and business accounts or property managed and operated digitally.
Specific examples include, but are not limited to: computing software and licenses, domain names, hard drives, music and books downloaded onto devices, passwords and information on phones or computers, cameras, social media accounts, online shopping accounts like PayPal, online subscriptions or recurring payments, online sales platforms like Etsy and eBay, mailing lists, customer account information and sales history, emails, anything stored in the cloud, and much more.
Essentially, if you’ve ever written an email or made an online purchase, you have digital assets.
WHAT TO KNOW ABOUT MODERN ESTATE PLANS
Property that exists online needs just as much, if not more protection and planning than physical property. Estate management services and laws regarding the management of property after death are always being updated, but Digital Estate Planning is still a relatively new area of law. As a result, regulations and processes ensuring the safety of digital content are sparse, inconsistent, and incomplete.
Some major online companies have policies in place to allow various degrees of account management after the user’s death. Facebook, for example, has a private user agreement that allows you to set a designee to “inherit” your account after you die, but this does not give them full access as would inheriting physical property in a Will. Referred to as a “legacy contact”, the designee is able to edit your profile and post a final message, but does not gain full ownership of the account or its contents posted by the deceased.
Other large companies such as Google have similar agreements, but most websites do not. Digital user agreements and terms of service are set up to ensure the utmost level of user privacy and security, and are intended to not allow access to anyone but the original user. This can mean that even if you designate ownership of an online account to someone in your Will or otherwise, they will likely not be granted access by the company that manages the account, or what they are given will be slow and inadequate.
WHY DOES THE PERSON EXECUTING MY WILL NEED ACCESS TO MY DIGITAL ACCOUNTS?
After someone’s death, digital access is required to fully manage, preserve, and close out the digital presence of the deceased. This includes accessing value assets, such as online bank accounts and investments; ensuring all bills are paid, subscriptions are cancelled, and debts settled; downloading and preserving personal property such as family photos posted on social media, or archiving personal blogs and online work; terminating social media accounts; and deleting private data from various locations on the internet, to prevent identity theft.
Without specific permission and full access to an account, your loved one’s likely will face obstacles when managing your estate. The legal authority granted to someone chosen to execute a will was designed for a different set of circumstances than the current reality, so their authority may be interpreted to apply strangely or inconsistently.
Your will might work for passing assets that you have licensed, like copyrighted work or domain names, but this would depend on the specific terms of the licensing agreement. Not all licenses allow transfer upon death. A personal designee retains the authority to request monetary value stored online, but in doing so risks losing other assets. An online store for example, would be required to transfer any remaining funds to your estate, but depending on their policy for deceased users, could then proceed to close the account permanently, taking any sales and contact information, unpublished work, or financial history with it.
Even services that operate in brick and mortar locations have a digital sector. Many banks have an inheritance option which includes online access to your account, called a “pay on death” beneficiary. Luckily, if your assets have a non-digital component to them, an executor is allowed their traditional authority. Even without the digital inheritance option specified, an executor can access and close your account by visiting the bank in person. However, even someone allowed management of a non-digital asset cannot access any corresponding digital accounts without your specific permission, so if that would make it more difficult for loved ones to follow your estate plan, it’s worth talking to a professional.
WHAT CAN YOU DO WHEN PLANNING FOR DIGITAL ASSETS?
There are plenty of options for designating what can happen in an estate plan, and digital assets are no different. You must leave passwords and explicit permission, because in nearly all states including Kansas, executors do not have legal authority to access or modify a deceased person’s digital assets. Additionally, unlike physical assets, digital ones are not passable in a will by default. Usually, they must be specified as passable, and any prior user privacy agreements must allow the asset to be passed in a Will.
Even if your Will gives them authority, without passwords they will likely face strong resistance from companies that manage digital accounts and files. The easiest and most consistent way to allow someone access to your accounts after your death, is to leave them passwords and instructions, so loved ones can follow your estate plan regardless of each company’s specific policy regarding transfers after death.
This does not mean you should include login information or any other personal data in a Will. Wills are made public when admitted to probate, and putting such private information in the open puts your accounts and legacy at risk. An alternative method is to save information and instructions for handling your digital assets in a secure, separate location, then mention the document and it’s designee in your will.
WE WANT TO HEAR FROM YOU
There is a lot to keep track of in the world of digital estate planning, but your trusted advocates at Addair Thurston Chtd. are here for you. By working with an estate planning legal professional, we can help you ensure all of your assets, physical, digital, and everything in between, are secure and planned for for years to come. To start planning your legacy in the digital age, schedule a one-on-one consultation with one of our dedicated attorneys today.