For many, preparing for a will or estate, the first thing that comes to mind is tangible items how they are to be distributed such as inheritance for property, finances, or heirlooms. Digital Estate Planning is often overlooked and not even considered. Yet, society has become dependent on technology leaving more of a digital footprint after we have died.
Prepare a Digital Estate Plan
As online property can be viewed as intangible and unfortunately forgotten or not handled properly, it is a good idea to develop a Digital Estate Plan. Include in the plan all your digital property and assets (i.e. art, photography, music, written material, intellectual property, etc.) and decide how they are to be managed if you become incapacitated or after your death. The first step is to make sure all your digital life is dealt according to your wishes.
There are 3 major areas digital life exists;
- Online banking and financial investments
- Email addresses and social media
- Photos and music
Each area requires a different strategy to ensure nothing is left or forgotten.
Create a master directory
Start by taking an inventory of all your digital life. Consider your online bank accounts, investments, emails, social media, documentation, photos, music, intellectual property, domain names, etc. Keep the master directory in a safe place since it contains sensitive information that should include gaining access to all your online accounts.
Here are a few options to consider storing your sensitive information.
- A printed document in a safe location or in a safe deposit box; however, the document is vulnerable and may not be current.
- Encrypted electronic list providing instructions on how to gain access to the accounts but may need to be updated manually.
- Software program such as LastPass that securely stores online account information. The advantage of using software such as LastPass, if a password is changed it automatically updates so the list is always current.
Name a Digital Executor
Choose a Digital Executor you can trust having access to your online accounts. Make sure the person is comfortable with navigating into different software programs and devices
Have it in writing
Formalize your digital estate plan by writing it down. Include the name of your trusted Digital Executor who is competent to manage and dispose of your online accounts in accordance with your wishes. Include any codes to access your computer, phone, or any other digital devices. The Digital Executor may require authorization to gain access to valuables or special digital property such as digitize intellectual property or confidential documents saved online. Arrangements with instructions to grant authorization could be included in the estate document.
Ask yourself questions;
- How can a Digital Estate Plan help my family?
- Who can I trust and is competent as my Digital Executor?
- Where do I leave information to access my online accounts?
- What digital property has financial value that needs to be reported for tax purposes and possibly submitted to probate?
- Are there any digital assets I want to distribute or transfer to individuals or appropriate parties?
Do you have questions about your digital property? Banka & Company, CPA might be able to help you. Contact us to schedule an appointment.