NOT JUST FOR TWENTY SOMETHINGS
Estate Planning For Digital Assets
Do you access your bank accounts online?
Pay bills or shop online?
Use software to track account information?
Manage investments electronically?
Use an online backup service for your computer?
Store digital photos or video on your computer or an internet service?
Use social media or publish your own blog?
Keep personal records in a password-protected computer file?
These are just some of the ways we create “digital assets.” Digital assets include files or information of any kind stored on your computer or other hardware, or on your own or an outside server. Current examples of digital assets include online bank and investment accounts, financial records stored electronically, medical records stored or accessed online, e-mail accounts, social networking accounts (Facebook, LinkedIn, or Twitter), blogs, photographs stored on Internet service providers (Flikr, Snapfish, Shutterfly), videos stored on YouTube, online shopping accounts holding credit card and other important information, and files stored on an online backup service (Mozy).
The list is extensive, and promises to grow longer. As we depend more and more on computers and the Internet to use and store our personal and financial information, thorough estate planning includes providing instructions for handling our digital assets when we die or if we become incapacitated. The main issues to address are identifying digital assets, and managing digital assets.
Identifying assets If someone asked you today to identify all the ways you use a computer, the internet, and other electronic tools, could you do it? What would you say? Could your spouse, parent, or child identify all the ways you use these tools, without your help?
Traditionally, the personal representative or trustee of an estate would begin assembling necessary information by reviewing the deceased person’s mail, check registers, bank and account statements, tax returns, and so forth – but many people today keep their financial records on their computer, pay bills online, never receive a paper statement, and file their tax returns electronically. What if the fiduciary cannot access this information because it is password protected?
Managing assets Assets may be economically valuable, or sentimentally valuable. Economically, how does your agent or personal representative manage a digital asset like an online investment account, a blog that generates advertising revenue, or an online business run through a website like eBay or Etsy, if the fiduciary does not know it exists, or has no authority to manage the business because of the service provider’s terms of service? Sentimentally, how can your digital photographs, video, e-mail correspondence, and conversations shared on social networking sites be preserved for your family members?
The kind and nature of digital assets change so rapidly that it is difficult to plan ahead, but there are basic steps you can take now to answer these questions:
1. Make a list. Inventory your hardware, and what it holds. List all your computers (work and home), flash drives, hard drives, backup CDs/DVDs, and include your digital camera and iPod, if those contain information not backed up elsewhere. Inventory your software and what you use it for as well, so you have a comprehensive list. Finally, inventory your online presence (web sites, blogs, social media, online backup sites for computer records, online storage sites for photos, video, documents, and other files), and your online accounts (banking and investment, bill paying, shopping, e-mail).
2. Get help and give appropriate authority. Discuss your list with a person you trust to manage these assets if you cannot. This might be the person whom you designate as an agent under a Durable Power of Attorney for Finances and Property, or your designated Personal Representative. Consider whether the people you choose to fill these positions are the most appropriate people to handle your digital assets (e.g., can your spouse use these tools effectively, or would your child be a better choice?). Consider how your digital “go-to” person can work with your agent or personal representative, and specify how this relationship should work in your estate planning documents.
3. Provide access. Good internet and computer security procedures do not mesh well with estate planning. From a security standpoint, passwords should be complicated, changed frequently, and kept secret. From a planning standpoint, complicated, frequently changed passwords are difficult to manage, and keeping them secret means others may never know they exist. As a practical matter, keeping a list of current passwords where it can be found at the appropriate time is the only way to ensure your survivors can get access to your important information. You can keep the list with your other important documents, and it should be updated regularly. Your digital “go-to” person, agent, or Personal Representative should know where you keep the list.
4. Give instructions. If you want certain digital assets to be handled in a specific way (e.g., you want your online photo account to be available to certain people, or you want your Facebook friends notified of your death, or you want your blog kept open or shut down upon your death), tell your digital “go-to” person, your agent, and your Personal Representative.
The speed at which our electronic tools evolve is sure to create more – and more complicated -- issues in managing digital assets in the future. The law governing these assets will evolve much more slowly, and will probably not be able to keep up with changes. Following these suggested steps will allow these important assets of yours to be managed when you cannot do so yourself.
Menn Law Firm, Ltd. regularly advises clients on estate planning issues. For further information on this topic, please contact Attorney Mary Lokensgard at email@example.com. All Menn Law attorneys can be reached by phone at 920-731-6631 to discuss any legal services you may require.
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