In the past, valuable and important information was stored in manila folders and in filing cabinets. The retrieval of this information was possible for anyone who knew where the information was kept. But with the spur and evolution of technology computer and internet stored information has become the norm, and this evolution has created new hurdles for people who plan to leave assets behind and for the administrators’ of the assets who have to locate and distribute these assets. Thankfully, these hurdles are easily manageable if one takes the correct precautions and measures in planning the future of their estate.
Why have an estate plan for digital assets?
- When information is stored digitally, the rules of estate planning change and vary. For instance, if your estate plan doesn’t include provision and planning for your digital assets, your heirs may have a hard time gaining access to them or may not be able to receive them at all. As a result, everything from family photos and videos, social media accounts, bank records and digital accounts, such as PayPal, Ebay and frequent flyer miles, could be lost forever.
- An even worse scenario is if all of your financial records are stored digitally and when it comes time for your heirs to review your will, they may not be able to gain access to the money you left them because all relevant financial records are stored digitally and password protected.
- Even though, generally password protection is a useful tool, it could be a major hurdle for heirs since gaining access to password protected files, is not only difficult but may require additional legal action. For example, if the passwords to your email accounts are not included in your estate planning, when it comes time for them to be accessed by your children they will not be able to do so, because internet sites like Google and Yahoo have a clause that does not allow them to grant access to their clients information without their authorization. When the client has passed that authorization could only be granted through a court order.
- Similarly, data encrypted files create issues, because if the files are accessed incorrectly the encryption can scramble the file’s data and make it impossible for information retrieval. This could be detrimental especially when this encryption can cause the loss of thousands of family pictures which you wished to pass on to your children as a family legacy.
- Furthermore, with the flux of digitally stored information, data privacy law makes it very difficult for anyone other than the owner of the digital files to gain access to the digital files, without the consent of the owner.
Ways to plan for your digital assets:
When it comes to planning for your digital assets, the procedure is rather simple and straight forward.
- One of the first crucial steps is to make a list of all the digital assets that you own.Examples of the digital assets include:
- Email Accounts,
- Social Media Accounts,
- Hotel Rewards
- Frequent Flyer Miles
- Amazon & Ebay Accounts
- iTunes Account
- Netflix Account
- Google Docs
- Digital storage of photos and videos
The benefit of this list will allow for your loved ones to know what assets you own and where to find them.
- Also it is very crucial to include a list of any correlating passwords that would be necessary for your loved ones to know if they want to gain access to the digital assets.
- Lastly, even if you provide all of the above mentioned information it is still necessary to give legal consent and authorization. The best way to do this is to talk with your attorneys.
Digital assets are still relatively new but are becoming more wide spread. The best action to take now is to become educated about the options that are available to you when it comes to your estate planning. Talk to your attorney about the steps you can take to better prepare yourself and your loved ones.