Why You Should Have a Digital Estate Plan: 

Estate planning has expanded beyond the traditional scope of wills, trusts, and powers of attorney.  In modern times, significant part of our lives exists digitally.  Your traditional estate plan likely does not account for what happens to your digital assets after death.  A digital estate plan comes into play as a method for organizing your online information.

Creating a digital estate plan provides access to information that your family can use to carry out your final wishes.  When your loved ones can rely on a written plan that outlines the passwords for your digital assets as well as how those assets should be managed, they will not have to worry about figuring it out in probate.  Dying without a digital estate plan leaves things to chance.  Your heirs may not be able to access your accounts or make the decisions you would have otherwise wanted.  

What are Digital Assets?

A digital asset can be any electronic record and file that is stored online, on mobile devices, or on personal computers.  When it comes to an estate plan, there are three categories of digital accounts that should be accounted for:

Financial:

Online bank accounts, brokerage accounts, cryptocurrency, and online payment platforms all need to be planned for.  Some clients will also have more obscure financial assets like points or rewards accounts and video game assets.  The actual liquid assets in these accounts are part of your traditional estate, but the method of accessing these online accounts should be included in your digital estate plan.

Sentimental:

Photos, messages, notes/journals, ancestry research, and social media accounts are typically overlooked but often prove to be the most valuable to family members once a loved one has passed.  Giving access to these accounts can prevent a loved one from being permanently locked out and unable to access precious digital assets.

Administrative:

Any data found in an account that will help heirs inventory and distribute assets efficiently should be logged.  The most common accounts for facilitating administration are email accounts and document drives.  Heirs may use these accounts to find information on your medical and insurance accounts, utility accounts, streaming services, domain registrations, credit card bills, e-book and digital movie libraries, etc.  These accounts can prove vital in locating traditional assets as well, akin to heirs sorting through mail and important papers.

How to Plan for Digital Assets:

With a few simple steps, you can organize your digital estate plan and leave a clear system for your digital fiduciary to use after you pass.

Take Inventory:

Thoroughly list all the digital assets and accounts you own.  Include the username and password you use for each account as well as the answers to any security questions.  Write down a comprehensive list of all websites and apps you use on your computer and mobile phone and update the list regularly.  Use this opportunity to close any old or unused accounts.

Allocate Access:

After your comprehensive list of digital assets has been created, you must determine how those assets will be distributed.  Determine which digital assets can be transferred and which cannot.  Some assets may be directly allocated to certain friends and family members.  For instance, digital assets with monetary value may be given to your children and your online photos handled by your spouse.  Social media cannot be transferred so you must choose whether you want those accounts to be memorialized or removed.  Access to online business accounts should be granted to a business partner or successor.

Appoint a Digital Executor:

Appointing a fiduciary or executor for your digital assets is the next step.  When you are incapacitated or die, the digital executor receives access to all of your online accounts.  They are also responsible for managing, distributing, or destroying the assets.  You can choose anyone to be your digital executor, but it is wise to choose an attorney, friend, or family member outside your immediate family.  This is helpful to remove the additional stress on your loved ones.

The digital executor should be named in your last will and testament and/or your financial power of attorney.  While a digital executor is not necessarily a legally binding or enforceable designation, it is still a good idea to create this role for a specific person.  To reduce any surprise or confusion, inform your chosen executory and your family members who will be handling your digital estate.

Make it Legal and Secure:

The last step in creating your digital estate plan is to document the above.  Not all states acknowledge digital estate plans, including Louisiana.  However, you are not precluded from formalizing your wishes in your will.

You should create it as a supplement or codicil to your will for two reasons.  First, when your succession is probated, your will becomes public record.  Keeping your digital estate plan in a separate document prevents strangers from having access to your online credentials.  Second, a separate digital estate plan allows you to make updates as needed without the burdensome step of updating your last will and testament.

The best way to ensure your digital estate plan is safe is by keeping it with your attorney, storing your information in a password storage database, or locking it in a safe.  Your digital executor should know where you store your digital estate plan.

Organize Your Digital Estate Plan Today:

Digital estate plans can be grueling to create and keep updated.  They may not even be enforceable.  However, by simply creating an inventory and giving access to someone trusted, the chances of your loved ones losing your digital assets will be greatly reduced.  By getting organized now, you can see to it that your wishes are followed in the end.

Louisiana Estate Planning Attorneys:

We are a Gretna law firm that has served the New Orleans area since 1980.  Our estate planning lawyers are well versed at creating estate plans and can help you supplement your will with a digital estate plan.  We take pride in offering a personal and trusted experience.  Call us today for a free consultation and find out why so many of our clients come back to us.