Digital Estate Planning

How much of your life is online? On a computer? On your phone?

When planning for the future of one’s estate, most people think only of their physical assets—those items of value that they can touch. For all the time that we spend on the internet, a computer, tablet, or phone, we oftentimes forget about our digital assets

The fact of the matter is this: the average person today has accumulated a significant number of valuable digital assets—more valuable than you might realize.

This year, the Uniform Law Commission drafted legislation that would grant digital account access to fiduciaries, or those who are in charge of your things when you die. This model legislation, known as the new Uniform Fiduciary Access to Digital Assets Act, is expected to be implemented in most states in 2015.

As is stated in the introduction to the act, “Few holders of digital assets and accounts consider the fate of their online presences once they are no longer able to manage their assets. And these assets have real value: according to a 2011 survey from McAfee, Intel’s security-technology unit, American consumers valued their digital assets, on average, at almost $55,000.”

Your digital assets may not add up to quite this much money in value, but they are most likely more numerous than you think. Do you print out your photos and keep them in an album, or are they merely stored on your phone? Are your important documents printed out and filed away in a filing cabinet, or are they sitting on your computer’s desktop or buried in your email inbox? How many online accounts do you have?

Your digital life needs closure just as your real-world life does. The author of an article in The Washington Post on digital asset management sat down and outlined all the things she could think of that her parents would not be able to access if she were to die tomorrow. The list—only partially complete—was surprisingly long and included many things you possibly have, too:

Think about if you were to die; if you had automated payments set up, you don’t want your accounts to continue being billed for a service you will no longer need. The money in those accounts should, by rights, be going to the survivors or causes of your choosing.

Automated payments are not your only concern. Another danger that can arise from poor estate planning for digital assets, or lack thereof, is identity theft—a crime which affects up to 9 million people each year. When an online user either becomes incapacitated or dies, that person is no longer able to manage his or her online accounts. These kinds of situations make it much easier for criminals to hack accounts and wreak havoc.

A decedent’s identity can be protected, but such protection requires access to the decedent’s online accounts. By properly managing a person’s digital assets, which means account usernames and passwords, issues like this can be avoided.

Over a dozen states are currently debating laws to grant digital account access, but only a handful of states have passed legislation on digital property. Even then, the ones who have vary in the degree of control that they grant to heirs. The state of Ohio currently has no such legislation. It is, therefore, up to you to include in your estate plan instructions on the future of your digital property.

The lack of legislation on this issue could complicate matters due to the push back from the tech industry. Most Internet service providers and other tech companies include their privacy policy in their terms-of-service agreements—and they hold to this very strictly. In their eyes, it doesn’t matter if it is an intimate family member who is requesting access—a user’s right to privacy tops all.

Consider this scenario:

You have a computer, whether laptop or desktop. You do everything from this computer: pay bills; manage your bank accounts; view medical records; send and read emails; store contracts, agreements, and other important documents; make online purchases; store photos and music; and much, much more. You have a password to your computer that no one knows but you.

You die or become incapacitated, and no one can access your digital life that is sitting there on that computer because…no one knows the password to your computer! Under current legislation, gaining access to that password could prove to be very difficult and painful, if not impossible. If your survivor does manage to get in, however, he or she has still barely scratched the surface; a maze of passwords still prevents this person from accessing and managing the wealth of information you have left behind.

Until Ohio and/or federal legislation has been passed regarding access rights to digital property, such problems will not be uncommon. It is for these reasons and more that we recommend you obtain professional legal help when planning for the future of your digital estate. As Ohio estate planning attorneys, we at Lovett & House Co., LPA encourage you to contact a professional who can help you draft your digital estate plan. Here are some things to keep in mind when thinking about the future of your digital affairs:

• Pick someone you trust. Think carefully about who you would like to be in charge of your digital assets upon your death or incapacitation. A child who you might not want to leave in charge of your financial affairs might in fact be the perfect keeper of your digital assets. You will need someone who is computer-savvy.
• Make sure the rest of your estate plan is in order. It is essential that you do not replace the traditional estate plan with a digital one. Digital estate planning is merely a part of estate planning. If you have not taken the other traditional measures, like establishing your powers of attorney, both financial and health, your survivors will come up against some problems. The person in whom you entrust your digital affairs might be able to log in and access your account information, but he or she may not have the legal authority to do anything else with that account.
• Plan for the future of your online legacy. Do you have a website or a blog? What do you want to happen to them? Just because you are gone does not mean that your work is no longer valuable to others. If you don’t want to simply drop off without informing your followers of the change, you will need to make sure that a trusted person has access to the site and has the ability and authority to make the necessary posts and updates.

For a more in-depth how-to on this topic, try checking out the book called Your Digital Afterlife. As the authors of this book point out, you have a “digital legacy” complete with “digital heirlooms,” whether you know it or not; make sure that your legacy lives on.