How do you protect digital assets in the event of incapacity or death? What exactly is a digital asset? A digital asset is any form of electronic data, along with the right to use that data. Some examples of digital assets include: online banking and financial accounts, virtual currency accounts, such as PayPal, files stored in the cloud or on a personal computer, device backups such as external storage drives, URL’s, digital business documents, family photos and videos, and social media accounts such as Linkedin, Facebook, Twitter, etc. We all have digital assets that can be protected in a few short steps.
The first thing you need to do is to take inventory of all your online accounts. Include all shopping sites, e-mail accounts, blogging sites, photo-sharing sites, credit card accounts, and online bill-payment accounts, such as those established with utilities. For each account, list log-in and password information as well as answers to “secret” questions and prepare a list to present to your attorney or yor designated digital fiduciary. Alternatively, you can utilize a Password Management System that will encrypt your log-in and password information and keep it stored on your own computer. This will involve creating one master password that is used to retrieve and update any of your password information. Include all of your personal accounts, as well, as your business accounts. Your business accounts should be incorporated into your business plan and available to business partners.
Decide who you want in control of these assets.
Who should handle each of these assets? A digital executor is the person who manages your digital assets upon your death or incapacitation. A single Digital Executor may be responsible for all digital assets. If you have a wide variety of different types of digital assets, naming more than one Executor may be the best option for you. This can be done by naming Digital Executors and specifying the specific digital assets you’d like each person to be responsible for. For example, you can name different Executors for Personal Assets, Business Assets, and Financial Assets. The nature of the property will help you determine who you may want as your Digital Executor. Choose wisely based on your nominees’ strengths and their ability to handle your assets wisely and according to your wishes.
What do you want to happen to your assets?
The type of asset will help you determine what you want to be done with it. While you may want some assets to be deleted, you may want others to be transferred to family members or friends. For each digital account that you have, specify how you’d like your Digital Executor to handle that asset. For example, revenue-generating assets may be transferred to people who will continue to manage the accounts and keep them going.
Incorporate your digital assets into your estate plan.
The easiest way to do this is to formally name a Digital Executor in your Will. Passwords and specific account information can be kept in a separate document and incorporated by reference into the Will. This allows private details of these assets remaining private. An estate planning attorney can easily incorporate your successors, trustees, and beneficiaries, of these digital assets and ensure the right documents are in place for ease of transition when it’s needed.
Digital assets carry tangible value (such as the online banking accounts), as well as emotional value (such as in home videos and family photos) and should be protected accordingly.
Incorporating Digital Assets into your estate plan will bring peace of mind to you as well as to your loved ones.