Having your own a customized estate plan has become more and more common. Digital estate planning has also become more common. But, what exactly is meant by digital estate planning? Nowadays, everyone has at least one digital asset, if not many. Digital assets include any property that is either based on a computer or involves the internet is some way, like online businesses and email accounts. Planning for who should inherit those assets and who should have the necessary information to access them is important. This is what our firm recommends.
Nearly everyone has digital assets of some kind
As communications technology, such as smart phones and tablets have become more popular, digital assets have become an integral part of estate planning. Despite the fact that, only a decade ago few people would have considered a phone to be a prized possession, today the majority of people rely almost entirely on our smart phones. That reliance is not limited to communication, either. We conduct business, store sensitive and valuable information, and much more on our cell phones. Although the phone itself may not be of particular value, the information that it contains would most likely be a valuable digital asset. Also, phones and computers serve as the primary method for accessing other digital assets. So, what do estate planning lawyers recommend?
The basics of digital estate planning
Digital estate planning provides strategies for protecting the assets you have on your cell phone or laptop. It also allows you to decide who should have access to your online accounts, including bank account logins and email accounts. On a more basic level, who do you want to have the basic knowledge that these digital assets even exist?
For those who sell items online using PayPal or eBay, which is linked to your bank account, there needs to be someone who knows how to access those accounts. That is especially important if you become incapacitated, for example. After your death, your executor should also have information on the accounts you own and how to access them. Ultimately, you must decide who will inherit them, of whether they should simply be closed. These are some of the reasons you need a digital estate plan.
Sensitive information is more often stored electronically
Decades ago, estates were made up of documents – wills, trusts powers of attorney, life insurance policies, and the like. These important estate planning tools were written out, witnessed and signed, compiled in a folder and stored in a safe, safety deposit box, or locked desk drawer. When a loved one died, the family would know where to go look for these documents and banks would be able to turn over account information to the proper person, either through the mail or in person.
Today, the majority of this information is digitized and accessible online. That means, most of our personal, financial, business, and administrative documents are kept in digital form. Despite this fact, very few of us actually maintain centralized accounts. For that reason, managing and distributing certain digital assets can be quite complicated after the owner has passed away. In some cases, families are denied access entirely.
Why digital access is important even after death
Entrepreneurs who actually have a brick and mortar business typically have at least some digital assets that are connected to their business, like online access to bank accounts or accounting software. For that reason, it is very important to provide access to the online components of the business so your successors can carry on with the business and your executor can settle your estate.
What can a digital estate plan really do for my family?
With the assistance of your estate planning lawyers, you can address many of the important issues that arise with digital assets for you and your family. With the proper digital estate planning tools, your family will be able to locate any accounts you have online, access to those accounts and the information they contain. Our estate planning firm can help your family be able to determine whether your digital property has any financial value, make sure your digital assets are distributed to the proper parties.
If you have questions regarding trusts or any other estate planning matters, please contact us at the Northern California Center for Estate Planning and Elder Law for a consultation. You can contact us either online or by calling us at (916) 437-3500. We are here to help!
Latest posts by Timothy P. Murphy (see all)
- Can Life Insurance Be Paid to a Trust? - August 25, 2019
- Do You Have to Go through Probate with a Living Trust? - August 23, 2019
- Top 3 Reasons to Create a Living Trust - August 21, 2019