Insight

Digital Assets Need to Be a Part of Your Estate Plan

Digital Assets Need to Be a Part of Your Estate Plan

John M. Goralka

John M. Goralka

May 16, 2022 07:39 PM

With all the electronic bill paying and online banking that goes on today, it's important to make provisions for them. Otherwise, things could get tough for your loved ones later on.

by: John M. Goralka

June 15, 2017

Thanks to the Internet, most companies provide you with the option to receive electronic statements, set up auto payments or pay your bills online. Many businesses are in favor of these methods and support online account management and paperless billing. It’s less expensive, more convenient and more environmentally friendly for them to send out bills via email than it is to mail them to each customer.

One issue with this type of account management is what will happen with these accounts when you die or become incapacitated? Without physical evidence of your bills or statements for your accounts, how will your successor trustee or family members be able to manage your bills or finances when the time comes? How will they know about bills due, or money owed if they are unable to access your email or online accounts?

Online profiles with personal information, pictures and contacts are increasingly used by all of us. These include Facebook, LinkedIn, Twitter and Instagram. How are these accounts or digital assets handled upon your death or incapacity?

    Your estate plan should be designed to make the administration process as easy as possible for your loved ones. This includes making it convenient to manage your assets upon your incapacity or death and saving them the hassle of sorting through your paperwork to collect assets and pay your bills. Without specific provisions in your estate plan and careful planning, access to this critical information can become difficult for your family or loved ones.

    Federal law regulating access to digital property does not yet exist. At this time, 29 states have established legislation or laws to protect digital assets and to provide a deceased person’s family procedures and rights to manage those accounts and assets after death.

    On Jan. 1, 2017, the Uniform Fiduciary Access to Digital Assets Act (the “Act”) became effective in California. California is one of the many states in the U.S. to adopt this law, which establishes a process for allowing your executor, trustee, power of attorney or court-appointed conservator to access your online accounts after your death. This act also allows you to designate some (or portions) of your account as “off-limits” after your death. This act has been added to the California Probate Code sections 870 – 884. Other states have established separate laws which differ from the Act. The states that have adopted either the Act or other similar laws or legislation include Arizona, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Maryland, Michigan, Minnesota, Nebraska, Nevada, New Jersey (in progress as of May 1, 2017) New York, North Carolina, Oklahoma, Oregon, Pennsylvania (in progress as of Nov. 19, 2015), Rhode Island, South Carolina, South Dakota, Tennessee, Virginia, Washington, Wisconsin and Wyoming. As laws continue to change this list may change from time to time. Please check with your local legislative branch to determine if your state has enacted this Act.

    Your Durable Power of Attorney and your trust instruments should include provisions consistent with California Probate Code sections 870 – 884 or the versions, if any, in effect for your state. These sections provide for naming a fiduciary to act on your behalf for these critical accounts, assets and profiles.

    In today’s digital world, most of our financial transactions and communications occur online. Photographs, websites and Internet profiles are now almost expected for all of us. You can do almost anything online, and many people choose to do so. These accounts have limited access with protected passwords, which can create problems when the account holder dies because no one has access to their passwords. Planning now can save a lot of heartache later.

    What do you do if you are not in a state of jurisdiction with protective laws? Who gets access to your Instagram, Facebook, LinkedIn or Twitter account when you die? In the absence of protective legislation, those accounts or assets are governed by the terms of the service agreement when the account was opened. Under these agreements, family members would need confidential identification information and passwords. Consider the following steps:

    1. Inventory Your Accounts.

    Document an inventory of the accounts including login IDs and passwords. That information should be maintained in a secure location.

    2. Create an Online Vault.

    This would be a place to keep passwords, identification or login information and other sensitive information. Two options are available through Everplans or Dropbox.

    3. Establish a Detailed Digital Asset Plan.

    This plan would have a clear, specific statement of intent about who would gain access to what information. This statement of intent should address all accounts, past, present and future.

    4. Carefully Select Your Trustee, Executor or Representative.

    When making your decision, consider the private and confidential information that will be accessible. Oftentimes, the information embedded in the digital assets is highly personal and confidential.

    https://www.kiplinger.com/article/retirement/t021-c032-s014-put-digital-assets-in-your-estate-plan.html

    Related Articles

    What Is Probate Court: A Complete Guide


    by Best Lawyers

    This complete guide to probate court covers everything you need to know about the legal process of distributing a deceased person's assets.

    Stacks of coins growing higher with trees standing on top

    The New PPE


    by Jennifer Stavros

    How to plan your pandemic preparedness estate—all from the safety of home.

    Planning Your Digital Estate Plan

    Pandemics and Planning: Lessons Learned


    by Anthony J. Enea

    It's important to be prepared for life-threatening emergencies, such as the COVID-19 pandemic. Here are six basic estate planning documents and advanced directives that everyone should have in order to deal with any potential health crisis.

    Estate Planning for COVID-19

    Trending Articles

    Introducing the 2026 Best Lawyers Awards in Australia, Japan, New Zealand and Singapore


    by Jennifer Verta

    This year’s awards reflect the strength of the Best Lawyers network and its role in elevating legal talent worldwide.

    2026 Best Lawyers Awards in Australia, Japan, New Zealand and Singapore

    Revealing the 2026 Best Lawyers Awards in Germany, France, Switzerland and Austria


    by Jamilla Tabbara

    These honors underscore the reach of the Best Lawyers network and its focus on top legal talent.

    map of Germany, France, Switzerland and Austria

    Effective Communication: A Conversation with Jefferson Fisher


    by Jamilla Tabbara

    The power of effective communication beyond the law.

     Image of Jefferson Fisher and Phillip Greer engaged in a conversation about effective communication

    The 2025 Legal Outlook Survey Results Are In


    by Jennifer Verta

    Discover what Best Lawyers honorees see ahead for the legal industry.

    Person standing at a crossroads with multiple intersecting paths and a signpost.

    The Best Lawyers Network: Global Recognition with Long-term Value


    by Jamilla Tabbara

    Learn how Best Lawyers' peer-review process helps recognized lawyers attract more clients and referral opportunities.

    Lawyers networking

    Jefferson Fisher: The Secrets to Influential Legal Marketing


    by Jennifer Verta

    How lawyers can apply Jefferson Fisher’s communication and marketing strategies to build trust, attract clients and grow their practice.

    Portrait of Jefferson Fisher a legal marketing expert

    Is Your Law Firm’s Website Driving Clients Away?


    by Jamilla Tabbara

    Identify key website issues that may be affecting client engagement and retention.

    Phone displaying 'This site cannot be reached' message

    A Guide to Workers' Compensation Law for 2025 and Beyond


    by Bryan Driscoll

    A woman with a laptop screen reflected in her glasses

    Medical Malpractice Reform Trends in Texas, Utah, Georgia and SC


    by Bryan Driscoll

    A fresh wave of medical malpractice reform is reshaping the law.

    Medical Malpractice Reform Trends hed

    Why Jack Dorsey and Elon Musk Want to 'Delete All IP Law'


    by Bryan Driscoll

    This Isn’t Just a Debate Over How to Pay Creators. It’s a Direct Challenge to Legal Infrastructure.

    Elon Musk and Jack Dorsey standing together Infront of the X logo

    Best Lawyers Launches CMO Advisory Board


    by Jamilla Tabbara

    Strategic counsel from legal marketing’s most experienced voices.

    Group photo of Best Lawyers CMO Advisory Board members

    Changes in California Employment Law for 2025


    by Laurie Villanueva

    What employers need to know to ensure compliance in the coming year and beyond

    A pair of hands holding a checklist featuring a generic profile picture and the state of California

    Common Law Firm Landing Page Problems to Address


    by Jamilla Tabbara

    Identify key issues on law firm landing pages to improve client engagement and conversion.

    Laptop showing law firm landing page analytics

    New Employment Law Recognizes Extraordinary Stress Is Everyday Reality for NY Lawyers


    by Bryan Driscoll

    A stressed woman has her head resting on her hands above a laptop

    Best Lawyers Introduces Smithy AI


    by Jamilla Tabbara

    Transforming legal content creation for attorneys and firms.

    Start using Smithy AI, a content tool by Best Lawyers

    How to Create High-Converting Landing Pages for Your Law Firm


    by Jamilla Tabbara

    Learn how to create high-converting law firm landing pages that drive client engagement and lead generation.

    Laptop screen displaying website tools to improve client conversion rates