The Growing Significance of Digital Estate Planning in Today’s Digital World

Without a digital estate plan, accessing and managing digital assets after someone passes away becomes extremely difficult for their loved ones in New Jersey.

No one likes to think about death and dying, especially their own, but if you want to protect all of your assets, it is crucial to include your digital estate. In today’s digital age, nearly 96% of all Americans in the past three years have access to the internet.  The United States is third in the world regarding the number of internet users nationwide.  Every day in the U.S., more than 335 million people are plugged in using the internet for work, financial transactions, education, social media, and entertainment; their lives are utterly intertwined with technology. The value of a digital estate shouldn’t be overlooked.  Knowing what composes a digital estate and how it can affect your estate’s assets is a crucial part of estate planning.

The Scope of a Digital Estate

Everyone is familiar with the concept of tangible assets and inheritance. These are assets that can be physically seen, bought, or sold. A digital estate comprises inheritable assets in the form of media, the rights to control that media, and online assets, contacts, and private information such as medical records, digital journals, photos, etc.  By not planning for your digital estate properly, information, memories, and financial assets could be lost.

Main Categories of Digital Assets: Sentimental and Financial

There are two main groups of digital assets: those with financial value and those with sentimental or personal value.

Financial assets such as cryptocurrencies, digital payment accounts (i.e., Venmo or Paypal), airline miles, hotel or travel points, online investments, and bank accounts are not tangible but can be converted into actual money.  Also, ownership of original online material and copyrights to books, art, music, web channels, podcasts, or others that provide an income stream can be considered a financial asset.

Our digital lives are rich and diverse, and so are our digital assets. These can include photos, videos, journals, blogs, email accounts, social media accounts, and sensitive information such as medical records, academic documents, and passwords. While these may not have a monetary value, they hold significant personal and sentimental value, making them an important part of your digital estate.

Control Who Has Access to Your Digital Life with a Solid Estate Plan

When you control who has access to your digital assets and accounts after you have passed, you decide what will be done with everything from finances to private journal entries. By giving someone access to your digital cloud, USB, and social media accounts such as Instagram and Facebook, you control what is seen, shared, or deleted and by whom. Pondering every digital footprint you have left behind can be quite a shock.

Sometimes, we don’t take the time to share the details of our digital assets, and other times, we are unsure with whom we can share those details.  When the time comes, if those we know and love do not have the tools given to resolve our digital estate, money, information, and sentimental items could be forever lost.

Knowing what a service provider such as Facebook or Google will do with your account is difficult once you are gone.  The Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) provides guidelines in these cases.  Access to digital assets is assessed in three tiers:

• Tier 1 is direct access from someone named by you through the service application channels before your passing.
• Tier 2 is when there is no specific conduit through the service provider, but you leave instructions in your will or another legal document.
• Tier 3 leaves the terms-of-service agreement to determine how access to the accounts will be handled.

Helpful Measures to Ensure a Comprehensive Digital Estate Plan

You can take several steps to create a digital estate plan that will express your wishes regarding your online accounts and digital property.  Start by creating a list of every login site you use, such as online shopping accounts, music accounts, financial accounts, and social media.  When dealing with cryptocurrency, you will need to leave your unique identifier and password for each digital wallet. You should acquire a password manager to list your accounts’ usernames and passwords and their respective links.  Some password manager services can store credit card information, PINs, and digital copies of important documents such as birth certificates.  Providing a list of usernames and passwords in your will is not a great idea, as this is a public document, and your sensitive information will be available to anyone.

You can name a digital executor who will manage everything in your digital asset portfolio or use the same executor for tangible and digital assets. In case there are problems accessing your information, it is a good idea to leave any security information with someone you trust and the trustee of your estate.  Discuss your plans with your digital executor ahead of time and in great detail.  Leave instructions regarding what should be done with social media accounts such as TikTok and Facebook.  Some choose to have them closed completely, while others prefer to add a period for comments and pictures in their memory.

What Happens if You Exclude Digital Assets from Your Estate Plan?

If your will or estate plan does not include digital assets, they will be distributed between the beneficiaries. However, identifying and accessing your digital assets could take several years. Your digital assets may contain sensitive information you wish not to share.  Some assets, such as cryptocurrencies, require a unique numeric key to be identified.  Without the key, your accounts cannot be opened and could be locked away forever.  Email service providers sometimes close inactive accounts after two years or more.  Valuable documents, photos, and more could be closed in your inactive account and never be seen again.

Protect Your Digital Legacy with Digital Estate Planning Assistance from Bronzino Law Firm in Southern New Jersey

Our digital world revolves at a rapid pace as technology and cyberspace overtake our daily lives and transactions. Everything from media, such as photos and videos, to financial transactions, is online.  If we want to protect our digital assets from theft or fraud, we must secure them carefully, but it is necessary to choose a person of trust to access those assets when the time comes. At the Bronzino Law Firm, our estate planning lawyers are highly familiar with the process of creating a comprehensive estate plan to meet your needs, including your digital legacy. Our estate planning services help clients in Point Pleasant, Lavallette, Ocean Township, Long Branch, Belmar, Manchester, Bradley Beach, and elsewhere in Monmouth and Ocean County navigate the complexities of digital asset protection. This is an intricate, detailed process that should never be done on your own.  Let our estate planning attorneys formulate an estate plan tailored to your unique situation. We have the skills and experience to take you through the process from start to finish.  Call us today for a free initial consultation at (732) 812-3102, or reach out to us online.