Digital Estate Planning
What is a Digital Asset?
A digital asset is any type of content stored digitally on a computer, website, or in the cloud. Most of us are online every single day for work and for personal reasons, generating documents, sending text messages and sharing images. These are all digital assets.
What else constitutes a digital asset that needs to be planned for in the event that you pass away?
- Social Media Accounts (Facebook, LinkedIn, Instagram, Twitter)
- iTunes Library, Kindle Store Purchases, and other digital purchases
- Points based programs for
- Cryptocurrency holdings and Non-Fungible Tokens
The good news is, platforms are beginning to catch onto this issue and are adapting their offerings to help executors manage accounts more efficiently after a death.
Linkedin, Facebook, and Instagram have recently introduced a memorialization feature for deceased users accounts. This service "preserves" the users account.
In the case of LinkedIn, this will allow the profile to remain publicly searchable and includes an "in remembrance" badge. Note that only an "authorized person" with respect to the deceased user can request memorialization.
Facebook allows users to specify in advance whether to have their accounts permanently deleted on their death. The user needs to simply identify a legacy contact who will notify Facebook that the user has passed away.
Digital Purchases like iTunes libraries, Kindle libraries - they contain property that someone may want to transfer on their death. Unfortunately, they are non-transferable and there is no right of survivorship on these accounts - and you do not own the items you purchase (its in the T's and C's when you sign up for the account). The accounts will be shut down on the users death.
Decentralized finance accounts - think Cryptocurrency and NFT's. In the case of a cryptocurrency, cryptocurrency wallets have public and private keys so that the owner can be identified and perform transactions. If these keys are lost, so are the balances held in these accounts. The system is completely decentralized, so there is nobody to go to for help if you lose your keys (or your deceased loved ones' keys). DeFi keys need to be documented and stored safely in a place where your executor (and them alone) can access them
Key Takeaways:
- Make sure that digital assets are addressed in your will
- Make sure that your estate documents specifically grant powers to your executor and power of attorney to deal with your digital assets
- Keep a list of services, logins and passwords and make sure your executor knows where to locate them
- You can use a password management software to help you (think LastPass, Keeper) - these services have an "emergency contact" option that you can use to grant your executor access in the event that you pass away
- Don’t forget about laptop/hard drives - logins and passwords
- Tread carefully - most user agreements will not permit anyone other than the owner of the account to login, so certainly have the list of logins and passwords and an up-to-date will, but you will want to instruct your executor to work closely with your estate attorney before logging in and making changes to your accounts after you pass away.
Links and Resources:
https://www.allaboutestates.ca/digital-estate-planning/
https://www.allaboutestates.ca/digital-estate-planning-part-1-digital-assets-preserve-destroy/
https://www.keepersecurity.com/