Last time we introduced the importance of planning for your digital assets and accounts in your estate planning. Click here if you missed it.
What’s the Difference Between Traditional & Digital Estate Planning?
A traditional estate plan is a written plan outlining who you want to inherit your property after you die and who you want to manage that transition of assets. It can address other issues too, such as naming guardians for your kids, but for our purposes, that’s a pretty succinct definition of an estate plan.
Don’t worry, though, because if you don’t have your own written estate plan, the government has one for you!
Traditional estate plans are based on written documents and records: Will, Trust, Powers of Attorney (these are still written, by the way), and written financial records that hopefully are organized and stored in a person’s office or desk where someone could locate them after their death.
What is a Digital Estate Plan?
Digital Estate Planning is the process of organizing your digital assets during your lifetime and planning for what should happen to them after your death.
Traditional estate plans do not address a person’s digital assets but they should. Why?
It used to be that if a person died without providing information about her financial accounts, her loved ones could follow a paper trail to determine what accounts she owned.
These days, many records are entirely digitized and stored online with no paper trail. Without proper organization and documentation of some kind, family members may not even know about such assets, let alone gain access to them after you die.
Creating a Digital Estate Plan in 5 Easy Steps
1. Make a List of all of your Digital Assets & How to Access Each One
Document your login information & passwords for each account or device. You can prepare a written list or document this list online.
2. Decide What You Want Done with These Assets After you Die
How should each asset be handled?
- Archived & stored?
- Deleted or erased?
- Transferred to someone else?
3. Name a Digital Executor
A digital executor is someone you designate to help you settle your digital affairs as you’ve outlined for them. Unfortunately, a digital executor is not legally binding nor even enforceable in most states yet, including Florida. That said, you can still name one to work with your Executor to help them with the digital aspects of your estate.
4. Store this Information in a Secure But Easily Accessible Location
Places to story such information:
- With your attorney.
- In a locked file cabinet or safe.
- With an online storage service like Everplans
No matter where you choose to store your digital estate plan, you’ll want to be sure that your loved ones know where your plan is and how to access it. That way, they’ll be able to access it when the time comes.
5. If Possible, Make it Legal
Some states, not Florida yet, allow you to formally name a Digital Executor in your Will or Trust to handle your digital assets after you die.
Since Florida hasn’t adopted such legislation yet, here are some suggestions:
- Define “digital assets” in your Will
- Specifically authorize your personal representative to either handle or dispose of your digital assets or authorize them to engage another person of your choosing to handle or dispose of such assets
- Reference the separate inventory and instructions that you’ve created concerning your digital assets (similar to a separate personal property memorandum)
- Consider adding a specific gift clause of such assets to whomever you choose and provide them with the access information to such assets
The bottom line is that the prevalence of online accounts in our world makes planning for our digital assets critical in the planning days of the future. We are starting to incorporate this planning with our clients at My Pink Lawyer®. Does your current plan include reference to your digital accounts? If not, it should.