Planning for digital assets within your estate plan is a relatively new concept for many of my clients. They plan for physical assets, like their homes and money, to be transferred through a Will or Trust but forget about their digital assets. However, planning for the transfer of digital assets is just as important.
Digital assets are something that your trustee or personal representative cannot physically hand to the beneficiary; rather, it lives remotely. With the explosion of NFTs and cryptocurrency, we have seen digital asset planning become routine in estate planning.
Digital assets include:
- Social media accounts
- Cloud data (typically from a cellphone or computer)
- Websites or blogs
- Email accounts
- Ecommerce accounts (such as Amazon, Shopify, Squarespace)
- Cryptocurrency accounts & bank account access
- NFTs (non-fungible token)
To keep your digital assets protected and pass them to your beneficiary, it is important that you both and your trustee/personal representative are aware of each digital asset you have and your username/passwords for each of those accounts. When a trustee is unaware of certain passwords or usernames, unfortunately this asset may never be able to be recovered. For this reason, some people opt to use a password-managing application so that a person only needs the master password to access the account information for all digital assets. To prevent hacking or data theft, passwords must be kept safe and difficult to guess.
There is an important distinction between the money in bank accounts versus the access to the online banking platform. The funds within the accounts are not digital assets and can be transferred as a pay-on-death, or through a will or trust. However, the access to the online platform is the digital asset. The same is true for stock profiles and cryptocurrency.
To plan for your digital assets now, make sure to speak with your estate planning attorney. Make a list of digital assets you have and close any accounts you no longer need. For Apple users, there is a Legacy Contact that you can add to your phone. A legacy contact is someone you can trust (ideally trustee or personal representative) that can access your phone after your death. Information such as notes, file, and photos can then be accessed by a legacy contact.
At Sullivan Law, we offer estate planning packages at a flat and reasonable fee. We also offer free consultations to discuss what your needs are, what you would like to do, and how that can be best accomplished. Everyone’s needs are different, and your wishes should be clearly listed and understood.
Call us at 248.917.1351 or email at asullivan@sullivanlawonline.com to schedule your free consultation today and discuss how to best protect your digital assets. We look forward to working with you!