Estate Planning for Digital Assets

By Greer Gibson Bacon, CFP®

Today, we live in a digital world.  We connect with friends, families and others using electronic devices, like our smart phones and computers.  We send messages, photos and videos using email and social media, like hotmail.com and Facebook.  We enjoy books, movies and music using online services and subscriptions, like Amazon, Netflix and iTunes.  These are a few of the more common “digital assets” in which we hold a right or interest. But, there are many more. 

What would happen to your digital assets if you died or became disabled?  Would your attorney-in-fact or personal representative be able to access, conserve and manage them for your benefit or that of your heirs?  Before Washington and Idaho adopted the Uniform Fiduciary Access to Digital Assets Act, Revised 2015 (RUFADAA), the answer was probably “no”.  In other words, your digital assets probably would have been lost forever. 

RUFADAA is important because it recognizes that digital assets can be accessed, conserved and managed by third parties just like real and personal property.  Here are a few steps you should take with respect to your digital assets. 

An important note … RUFADAA does not apply to your employer’s digital assets.  So, keep your personal assets separate on your personal devices and in your personal accounts.  

Create a digital asset inventory.  Begin by inventorying your electronic devices.  Then, inventory all of your accounts.  If you are like most people, you will be surprised by how many you have.  Add URLs, User IDs and Passwords and store in a secure location. 

Define your goal for them.  Begin by determining which digital assets you would like to be accessible and which ones you want to remain private, and to whom you wish to grant access.  For example, you may want your health care proxy to have access to your medical records but not your Ancestry.com account.  Then, investigate providers and their terms of service.  Today, many (but not all) provide an online tool allowing you to grant accesses to your accounts.  Record your findings and any actions you take

Meet with your estate attorney.  If your documents are more than a few years old, it is likely your power-of-attorney, trust or will needs updating to fully address digital asset access.  Be sure to provide him or her with all of the information you have compiled.   

Maintain your digital asset inventory.  There are several ways you can do this.  You can keep a master password list using a notebook or the notepad function on your computer or smart phone.  You can subscribe to a password manager service.  Most charge a monthly fee and some allow you to set-up accesses for trusted persons.  Finally, you can subscribe to a digital estate planning service.  Although some do not store your passwords, most provide reports to help your attorney and trusted persons locate your digital assets.  Whatever you do … be diligent!  And, be sure your attorney and trusted persons know where this information is located and how to access it. 

Digital assets are a rapidly growing part of our estates.  And, whether you want to preserve financial assets or family history, proper planning is required.

 

This article first appeared in the May/June 2018 Spokane County Medical Society Magazine. The information referenced in the article is current as of date of publication.

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