Technology changed how we transact business and managing our lives. Administering and allocating digital assets after we die is now an important part of estate planning.
Digital assets are a vital part of the estate
People now possess financial digital assets such as bank accounts, online payment services such as PayPal and cryptocurrency and online reward points such as Air Miles.
Planning should also involve digital collections. These include photographs, social media posts and video and music files.
Digital accounts are different than digital assets but need to be properly administered. Accounts are different than an online purchased music or manuscript. Accounts are usually with Spotify, Netflix, and other streaming services. The average person has approximately 100 accounts.
Challenges faced by the executor
If the asset holder had a will, its executor must secure these digital assets and their traditional physical assets. This also includes terminating or memorializing social media accounts such as Facebook or a LinkedIn account.
Digital assets that are unaccounted for in an estate plan can complicate the executor’s duties. Unlike physical assets, there may be no physical records alerting executors to the existence of an online account or asset.
Many servicing agreements governing accounts do not allow access to an unauthorized person even if the executor has the current username and password.
Planning for access
People are usually unaware of the extent of their digital assets and accounts. They should inventory all of their digital assets and keep a list identifying the accounts, passwords, and usernames in a secure but accessible place. Executors and family members should be aware of this location.
Executors and family members must also have access to a person’s email. This will allow access to online accounts and reveal their existence.
Alphabet, Inc. Facebook, and Apple have also introduced options allowing users to determine what happens to their accounts when they die. However, these options have been infrequently used.