When you think about drafting a will or a trust, and you mentally go through your assets, you might forget one very important item: your digital assets. Your heirs and executors will not only need to distribute tangible property like your house or your car; your digital property will need to be divided up as well.
You have probably invested a lot in your digital assets, both in time and money. You should be able to pass this on to your loved ones. Some smart estate planning can help you protect your digital assets and preserve them for your heirs.
When you make a plan for your digital property, you make life much easier for your executor and heirs, and you ensure that your memories will be preserved the way you want them. But figuring out how to handle your online life after your death takes a bit of planning.
What Are Digital Assets?
Your digital assets are everything that you store electronically, either on a local computer or in the cloud. This could be anything from your Facebook page and email accounts to digital access for your credit cards and bank accounts to the domains and websites you own. Your digital assets can include media accounts such as iTunes or Netflix, frequent flyer accounts, grocery store rewards programs, and your posts on social networks such as Twitter and Instagram. Electronic devices such as your computer, phone, or tablet and all the data on them are also some of your digital assets. More than two-thirds of Americans use the internet, and the majority of those have a Facebook page. There have been millions of photos posted on Flickr and Instagram, countless videos uploaded to YouTube, and millions of posts to Twitter, Facebook, and other social media. A little piece of that belongs to you. The online world is a part of the fabric of our daily lives. Your digital assets are valuable. They’re worth protecting.Why Your Digital Assets Matter to Your Heirs
Place yourself in the shoes of your executor. Someone you love has passed away, and it’s your job to take charge of her financial accounts and wrap up her affairs. She didn’t have a chance to give you a list of her passwords before she died, so you can’t access her accounts online. You’re paying two sets of bills now – your own and those of the estate. Even worse, your life is tied up in phone calls to utilities and credit card companies. You sift through piles of mail, trying to make sense of the bills. Notices get sent to her email, but you don’t get them because you don’t have access to her accounts. You present the proper paperwork: her death certificate, proof that you are the executor of her estate. Some providers give you access, reluctantly, but others refuse. Once you notify Yahoo that she has died, the company deletes her email account, and you have no way to notify her contacts that she has died. Important email notifications get bounced back with no forwarding message. It doesn’t have to be this way. When you include your digital assets in your estate plan, you can give your executor legal authorization that will allow providers to grant access to vital online accounts. With proper planning, you would have the authorization to turn your loved one’s Facebook page into a memorial, so her friends have a place to share memories. With access to her digital assets, you could protect her legacy and also make sure that her accounts are safe from fraud and hacking now that she’s not here to watch over them.Laws Governing Digital Assets
As with so many things about the internet, federal and state laws are catching up slowly with current reality that the majority of us will have digital assets to leave to our beneficiaries when we die. The laws governing electronic forms of communication, such as emails and texts, were not written to include the fate of your digital assets after you die. The federal Stored Communications Act prohibits email providers such as Google and Yahoo from sharing your stored communications with anyone but you. The Federal Computer Fraud and Abuse Act make it a crime to access someone’s computer without permission. Fortunately, state lawmakers have stepped up to the challenge. In 2012, the Uniform Law Commission drafted the Uniform Fiduciary Access to Digital Assets Act (UFADAA). The act has been revised (2012 was an eon ago in the evolution of the internet), most recently in 2015. It has currently been adopted or is under consideration in all but three states. The UFADAA recognizes that digital property, like tangible property, is part of your estate once you die and that your executor has the right to access your digital assets. The powers granted by this law extend to people to whom you grant Powers of Attorney and to conservators, who look after the estates of people who are unable to manage their affairs. Unhappy with the terms of UFADAA, an internet service providers’ organization drafted their model legislation, the Privacy Expectation Afterlife and Choices Act (PEAC). California, home to Silicon Valley, enacted legislation that includes elements of both UFADAA and PEAC. The California law is much more restrictive than UFADAA. It requires your executor to show that you have given your permission, in writing (such as a clause in your will or trust), to gain access to your digital assets. If your consent is not in writing, the Terms of Service (TOS) for the account determine whether your executor gets access. In almost every case, the TOS will lock your executor out of your digital property. The moral of the story: it’s a very good idea to put your wishes regarding your digital property into your will.
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