How to Manage Digital Assets Through Estate Planning
It is a great idea to prepare a Will that dictates how you want your estate to be distributed after you die. A Will usually addresses all of a person’s important assets, such as their house, vehicles, personal property, and even their jewelry. But what about your digital assets?
In the era we live in, digital assets have become increasingly important. Today, digital assets can have real value, and that value does not necessarily need to be monetary. Not only might your digital assets represent a significant part of your wealth, but they might also possess an incredible amount of sentimental value for you and your family.
However, without proper estate planning, all of your digital assets could be locked away permanently after you pass away and lost to your beneficiaries forever. Call us today to discuss ways to protect your digital legacy with an experienced Virginia estate planning attorney.
What are Digital Assets?
Examples of digital assets include:
- Money in Online Bank Accounts
- Cryptocurrencies
- E-wallets like PayPal
- Websites
- Blogs
- Social Media Accounts like Facebook
- Documents Stored in The Cloud
- Digital Photos and Video
- Email Accounts
Estate planning for digital assets can be tricky because they are different from traditional assets like bank accounts and real estate. Moreover, digital assets are usually protected by very tight cybersecurity measures that are designed to prevent unauthorized access by anyone other than the owner.
Estate Planning for Your Digital Assets
Overlooking your digital assets can have devastating consequences. If you pass away without leaving behind the proper information and access to your digital assets, the executor or trustee of your estate will be unable to access them when you die or become incapacitated. If there is one thing you take away from this article, it should be that you must shift your thinking around digital assets. You need to think of the data as tangible personal property. By data, we mean your account credentials, or in the case of a cryptocurrency, the actual token for your currency. If you lose the data, or you access to the data, then the asset is irretrievably lost, just like tangible personal property.
Here are three steps you can take to ensure that your valuable digital assets are accessible by your beneficiaries in the event of your death or incapacity, while preserving your confidential access to them while you are alive and well:
1. Make A List of All of Your Online Accounts
Inventory all of your digital assets. Write down every online account that you use. If it is stored on the internet, accessed via the internet, or relates to the internet in any way, put it on a list to be given to your attorney, executor, or trustee. If you are a business owner, make sure that you include all of your digital business records.
2. Designate a Successor Trustee for Your Digital Assets
Choose someone you trust to leave information and access to your digital assets with. Remember, estate planning isn’t only about what happens after you pass away, it’s also about what happens when you are alive but incapacitated. So, you need to make sure that your successor trustee has access to all of your digital accounts and can act on your behalf when you can’t do so yourself.
3. Create A Digital Estate Plan
You might want to transfer ownership of some of your digital assets to a living trust or give someone access to them in a power of attorney. Either way, you should consult with an experienced estate planning attorney for advice on the best way to leave your executor, successor trustee, and your beneficiaries access to your digital assets when the time comes.
If you have any questions about estate planning for digital assets in Virginia, please give us a call at (703) 553-2577 or use the contact form on our website to arrange a consultation with an experienced Virginia estate planning attorney.
The information on this site is for general informational purposes only. The information presented in this site is not legal advice or a legal opinion. You should seek the advice of legal counsel of your choice before acting upon any of the information in this site.