Ok, you have logins and passwords to access your digital assets, but how do you include these assets in your estate plan?
Let’s be honest, we’re living in the most technologically advanced time in human history and we have created logins and passwords for so many of these digital assets we now own, like our email accounts, our social media accounts, etc.
But if you haven’t properly addressed your digital assets in your estate plan, there’s a good chance that most of those assets will be lost forever when you die.
Without the proper estate planning, just locating and accessing your digital assets can be a major headache—or even impossible—for your loved ones following your incapacity or death. And even if your loved ones can access your digital property, in some cases, doing so may violate privacy laws or the terms of service governing your accounts. Plus, you may also have certain digital assets that you don’t want your loved ones to inherit, so you’ll need to take steps to restrict or limit access to those assets.
To ensure all of your digital assets are properly accounted for, managed, and passed on exactly the way you want, take the following 3 steps:
1. Create a detailed digital asset inventory with access instructions:
Open up Excel or Google Sheet and start creating a list of all the digital assets you currently own. I’m talking about every single social media account, every single email account you have, even crypto currency accounts. Then, for each asset on your list, provide detailed information about how it can be accessed, including all of the relevant login information and passwords. If you have a lot of different accounts, password management apps, such as LastPass, can help simplify this effort.
In fact, if you put all login access to every digital asset you have in your free LastPass password manager, then you could store the LastPass Master Password in your estate planning binder to allow your loved ones to more easily access all of your accounts after you’re gone via your LastPass account.
If you own cryptocurrency, prepare detailed instructions about how to access your cryptocurrency, and ensure that one or more people you trust know that you have a cryptocurrency and how to find your instructions. Because accessing cryptocurrency requires correct usernames and private keys, as well as knowledge of wallets, digital exchanges, and other storage devices (like cold storage nano ledgers, etc), leaving a detailed “How To” guide may be essential to ensure your loved ones can access these assets.
After you’ve created your inventory and access instructions, store these documents in a secure location with your other estate planning documents, and ensure your loved ones or those you named as executor of your estate or trustee of your trust, knows how to access these documents in the event something happens to you.
You can even back up any digital assets stored in the cloud to a computer, USB drive, or some other external hardrive to make them easier to manage. And remember to update your digital-asset inventory regularly to account for any new digital property you acquire or accounts you close.
2. Include relevant hardware in your digital asset inventory
When you have completed your Digital Asset Inventory Google Sheet or Excel File, also include logins for any physical devices—smartphones, computers, tablets, flash drives—on which the digital assets are stored. Allowing your loved ones, executor or trustee to have quick access to this equipment will make it much easier for them to transfer the online assets (especially if you have 2-way authentication set up on certain accounts).
3. Add your digital assets to your estate plan:
Once you’ve created your inventory of digital assets, you’ll need to add those assets to your estate plan. As with any other asset you own, you’ll typically pass your digital assets to your loved ones through either a will or a revocable living trust. You can always schedule a quick 15 minute call with me to discuss which strategy is best suited for your particular situation.
Do NOT include the specific account info, logins, or passwords in your estate planning documents, which can be easily read by others. This is especially true for wills, which become public records upon your death. Keep this information stored in a secure place, and let your fiduciary know how to find and use it.
In summary, as technology continues to evolve and our lives become increasingly digitized, it’s vital that you adapt your estate planning strategies to keep pace with these changes. As an estate planning law firm, we can assist you in updating your estate plan to include not only your traditional assets, but all of your digital assets as well. If you’d like to talk more about how we can do just that, feel free to schedule an initial 15 minute call with me –– for free –– by Clicking here.
This article is a service of estate planning attorney Elliott Feldman and the Elliott Feldman Law Group. We do not just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Prosperity Planning Session, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Prosperity Planning Session and mention this article to find out how to get this $750 planning session at no charge.