In today's digital age, our lives are increasingly intertwined with the online world. From social media profiles and email accounts to cryptocurrency wallets and online banking, digital assets have become a significant part of our estates. But how do you ensure these assets are properly managed and passed on to your loved ones? Let's dive into the basics of including digital assets in your estate plan and why it's so important.

What Are Digital Assets?

Digital assets cover a wide range of online and electronic items, including:

• Financial accounts: Online banking, investment accounts, and cryptocurrency holdings.

• Social media: Profiles on platforms like Facebook, Instagram, LinkedIn, and Twitter.

• Email accounts: Personal and professional email addresses.

• E-commerce: PayPal, Venmo, and e-commerce accounts like Amazon and eBay.

• Subscriptions: Accounts for streaming services, cloud storage, and software licenses.

• Intellectual property: Blogs, websites, photos, videos, and other creative works.

• Loyalty rewards: Airline miles, hotel points, and other reward program balances.

The Process of Including Digital Assets in Your Estate Plan

When clients reach out to my office about estate planning, I often walk them through the importance of managing digital assets. Here's an overview of how I typically handle the process:

Initial Consultation

During the initial consultation, I ask high-level questions to understand the client's digital presence. For instance, I'll inquire about:

• The types of online accounts they use regularly.

• Whether they hold any cryptocurrency or other significant digital investments.

• Their preferences for managing these accounts after their passing.

This helps me gauge the scope of their digital estate planning needs.

Inventory of Digital Assets

Next, I recommend creating a detailed inventory of all digital assets. This inventory should include:

• Account names and associated platforms.

• Usernames, passwords, and security questions (stored securely).

• Instructions for how each account should be handled (e.g., deletion, memorialization, or transfer).

Incorporating Digital Assets into Legal Documents

Once the inventory is complete, I help clients integrate their digital assets into their estate plan. This typically involves:

1. Living Trust: Ensuring digital assets like cryptocurrency are properly titled.

2. Will or Digital Executor Designation: Naming someone to manage and distribute these assets.

3. Power of Attorney: Including specific language granting authority over digital accounts.

Finalizing and Securing Documents

After drafting the necessary documents, they are reviewed, signed, and notarized as needed. I also recommend:

• Informing digital executors and other key individuals of their roles.

• Storing copies of estate planning documents securely, both physically and digitally.

Periodic Updates

Because digital assets can change rapidly, I advise clients to review and update their estate plan regularly to reflect any new accounts or changes in preferences.

Why This Matters

Failing to account for digital assets in your estate plan can result in:

• Lost value: Heirs may miss out on accessing cryptocurrency or online businesses.

• Identity theft: Unsecured accounts are vulnerable to hackers.

• Emotional distress: Families may lose access to sentimental items, such as photos or personal messages.

Legal Framework in California

California's Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) provides guidance on managing digital assets. This law allows you to:

• Use service providers' online tools to set post-death account preferences.

• Grant a fiduciary explicit permission to access digital accounts.

• Incorporate digital asset management instructions into your will or trust.

Final Thoughts

Incorporating digital assets into your estate plan is essential for comprehensive asset management and peace of mind. If you have questions or need assistance with your digital estate planning, feel free to contact my office for personalized guidance.

LEGAL DISCLAIMER

This article is intended for general information purposes only. Any legal analysis or other content should not be construed as legal or professional advice or substitute for such advice. No attorney-client or confidential relationship is formed by transmission of information. If you require legal or professional advice, please contact an attorney or other suitable professional advisor. The choice of an attorney or other professional is an important decision and should not be based solely upon advertisements and blog postings.