As we continue to expand our digital footprint, it is important to incorporate our digital lives into an estate plan so our digital legacy may be preserved.
Some call these instructions a “digital will.” This set of instructions is a section of your estate plan that covers email addresses, social media accounts, passwords, website login information, etc. These instructions can prevent a lot of headache, heartache, and cost for your heirs because gaining access to this information can be nearly impossible.
Many of us do not realize how deep our digital lives go. Everything from pictures that we store on the cloud to medical records contained in a virtual portal, our online lives have become robust, and potentially overwhelming to heirs who may not know how complex it is.
The first step in mapping out your digital legacy is to designate an online executor. This person can be the same or different than your actual executor. He or she will be in charge of managing your digital assets, canceling subscriptions, closing accounts, and rerouting information if necessary.
The next step would be to make a list of all your digital assets and digital liabilities (auto payments from bank or credit card account). Include the name, website link, username, and password.
Some items may include:
- Email Account(s) and Passwords
- Financial Information (bank, credit card, 401(k), IRA)
- Medical Information (online healthcare portals)
- Social Media (Facebook, LinkedIn, Instagram, Twitter)
- Municipal Bills (gas, electric, water, trash)
- Cable/Internet/Streaming Services (Netflix, Amazon, Hulu, Direct TV)
- Car Payments
- Mortgage Payments/Rental Real Estate
- Computer Login (password)
- Apple ID (photos, iTunes, apps)
- Cloud Login
- Phone Password
- Subscriptions
- Digital Currencies (Bitcoin, Blockchain, etc)
- Business Accounts
Up until only a couple years ago, it was very difficult for executors and trustees to gain access to a person’s digital assets unless approved by court order. Now, certain federal and state laws have made this process somewhat easier.
In 2015, the Revised Uniform Fiduciary Access to Digital Assets Act was passed at a federal level to encourage a standardized practice among states, allowing executors and trustees to gain disclosure of a person’s digital assets after the original user’s death under certain conditions.
Currently, Massachusetts is among only three other states that have not yet passed accompanying bills, including Kentucky, New Hampshire, and Pennsylvania. MA hopes to adopt a similar act with proposed bill H. 3368, “An Act for Uniform Fiduciary Access to Digital Assets.” It is awaiting Congress approval.
After you have outlined your digital account information, take a minute to familiarize yourself with certain accounts that implement memorialization features, social media accounts in particular. Some allow your account to stay open for friends and family to share pictures and memories. Others will close your account with proof of death certificate. By understanding these features, you will be able to provide detailed instructions to your heirs so they do not have to bear the burden of making these decisions on their own.
You are the creator of your legacy. You can determine whether and how you would like your digital life preserved. Some people choose to limit email access to their family members and select a neutral party to review email content before forwarding any relevant information necessary to manage the estate or handle financial information. You can separate out digital instructions to different people; it doesn’t all have to be designated to one person.
The next time you sit down with a spouse, family member, attorney, or an estate advisor, think about how you wish to leave your legacy and weave a digital will into your estate plan for peace of mind and guidance for your heirs.
Stuart Steinberg, CPA, MBA has been working with families and their finances since 1988. He can be reached at 61 Water Street, #2, Newburyport, MA 01950 and at (978)864-9581 and stu@eaglerockwealth.net.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. This information is not intended to be a substitute for specific individualized tax advice. We suggest you discuss your specific tax issues with a qualified tax advisor.
Securities and Financial planning offered through LPL Financial, a registered investment advisor. Member FINRA www.finra.org / SIPC www.sipc.org.
