Digital Estate Planning
Many people read articles discussing the importance of protecting and safekeeping passwords, and recognize that if they are not careful, their online accounts and other activities may be compromised, leading to disastrous results. It is possible, however, that you may protect these same passwords so well that in a period of incapacity or upon your death, your agent or executor will not have access to your online accounts.
Digital estate planning is a relatively new concept in traditional estate planning that takes online activity into account when designing your plan. Digital estate planning not only tries to ensure that your agent or executor has access to your online accounts, but it also takes into account the plethora of other electronic assets that the average American now has.
To illustrate the importance of completing digital estate planning, I’ll use the example of Scott, a 40 year old single man who, like many people, has a large online presence. Scott does all of his banking online and never receives a bank statement in the mail. He has an investment account at a company that does not have a brick-and-mortar location. Scott pays his bills electronically, without receiving a hardcopy bill, and he pays some of his bills automatically on a monthly basis. He has several e-mail accounts and maintains his own website and blog. Scott buys and sells items online through Amazon and eBay, using his PayPal account to complete the transactions. He has an extensive photo and music collection that he stores online, and he is an active Facebook and Twitter user. Finally, because Scott prefers to not have papers lying around his house, he stores copies of all of his medical, financial, tax, and legal documents on a “cloud” server.
Now imagine that Scott becomes incapacitated or dies. How would Scott’s agent or executor begin to handle his affairs? How would this agent or executor have any idea of the true extent of his or her responsibilities? Digital estate planning attempts to prevent these problems from occurring.
One of the first things that digital estate planning involves is taking inventory of your online presence. In addition those mentioned for Scott, other examples of your online presence (also referred to as “digital assets” or “electronic assets”) include:
– Website domain name ownership;
– Music playlists;
– Online videos, stored on sites like YouTube; and
– Online magazine, newspaper, and website subscriptions.
After taking an inventory, the next step is ensuring that your agent or executor is aware of and is able to handle each of the items. You should also consider storing this information on a CD or flash drive that can be kept with your estate planning documents. Your agent or executor will likely need access to your personal computer, tablet, and/or smart phone, so make sure that you provide instructions for how to access these devices.
You may also want to include language in your power of attorney or will that allows your agent or executor to handle your digital assets. It is important to note, though, that each online provider typically has a service agreement that may limit the ability of another individual (such as your agent or executor) to access your online information. Some service agreements may actually state that you do not, in fact, own your electronic assets.
There is not much established law in the field of digital estate planning, but in the coming years, we will surely see this area of law evolve. Although Virginia has not done so, other states have begun to address the issues involved with digital estate planning by passing laws that provide executors with access to digital assets, and authorizing an executor to take control of a deceased individual’s online presence. As we all move towards a more digital world, the importance of digital estate planning will only grow.
The lawyers of The Estate Planning & Elder Law Firm are available to help you with your traditional estate planning and your digital estate planning. The attorneys at The Estate Planning & Elder Law Firm can also assist clients with their estate, financial, insurance, long-term care, veterans’ benefits, and special needs planning issues.
Call Ariba Asset Management at 1-800-808-7488 for a review of your financial planning needs and for a portfolio review.
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