What are the first assets that come to mind when you think about preparing your estate plan? You probably consider your home, vehicles, family heirlooms, and, if you’re a business owner, your company. There exists a facet of asset protection that may not jump to the forefront of your mind, but that is increasingly essential to personal and business legacies: digital assets.
Think about the first place you go when you need to purchase an item, send a message, or read the latest news. Likely, you don’t go anywhere, but type your request into a search engine or email subject line. The business world is rapidly shifting into the virtual sphere; this raises the question, “How will estate planning evolve to meet the digital needs of an Instagramming, LinkedIn-connected society?”
Below, we’ll discuss the scope of “digital assets”, current resources and policies for their preservation, where to begin protecting your digital assets, and how meeting with an attorney is the essential final step in locking in your virtual estate plan.
What Are Your Digital Assets?
Most of us have at least one social media account, email address, or subscription to an online publication. But which of these comprises your digital estate? According to Naomi Cahn, Professor of Law at George Washington University Law School, “Most people are not putting off creating a plan for their digital assets because they don’t want to think about it. They don’t know they actually have digital assets that have any value and are worth planning for." (1)
As an individual or business, your digital assets are comprised of your online accounts, websites, copyrights, products, and subscriptions. Your social media pages, blog, lists of contacts, and photos are your intellectual property. (2) For businesses, ensuring the protection of your company’s online legacy can be the deciding factor in your longevity. If something happens to you, who has access to your accounts? Let’s look at some of the resources currently in place to assist individuals and companies in this endeavor.
Resources for Protecting Your Digital Assets
While laws are still evolving to fit 21st century needs, certain sites and companies have already put virtual protection strategies in place.
Google, for instance, has created an Inactive Account Manager, which tracks users’ recent activity. You have the option to enter contact information for a trusted person. In the event that your account goes a certain amount of time without activity, the designated person will be contacted by email. Depending on your wishes, you can opt to send links to your digital resources to the person, or they may simply be notified of your lack of activity. Google requires the phone number of the contact to ensure data is only given to the intended recipient. This can assist businesses in the event of a tragic circumstance, as an “heir” to the account is chosen ahead of time. Additionally, no unauthorized individuals trying to get access after the event will be able to do so.
Facebook Legacy is another helpful resource. If a Facebook account is memorialized (which requires proof of death to be provided to Facebook), a designated legacy contact will have limited access to the account: they will be able to pin posts, respond to friend requests, update pictures and information, and request the removal of the account. Like the Inactive Account Manager contact, legacy contacts are chosen beforehand and notified when the account becomes memorialized. Permissions not afforded to legacy contacts include: logging into the account, changing existing posts, reading messages, removing friends, or making new friend requests. It should be noted that an individual must be 18 years or older to be a legacy Facebook contact.
Microsoft Outlook, the email server of choice for many businesses, has a “next of kin” procedure that includes an authentication process. A DVD with the inactive user’s digital material is sent to the next of kin. (3)
There are certain sites and companies that keep a stricter grip on digital assets. Yahoo, for instance, requires a court order to provide access to another’s account, and Yahoo accounts cannot be transferred at all.
To summarize, access to someone else’s digital assets depends on the forum, the inactive user’s previously established wishes, and how closely the person desiring access is or was to the owner of the accounts.
Where To Begin
We’ve established the essential nature of protecting digital assets, and some of the resources available for doing so. What’s the first step in the process? Theresa M. Wade, shareholder at Garrett Hemann Robertson P.C., advises, “It is critical that a list be maintained, and made available to a trusted family member or fiduciary, reflecting the username and password for each of these assets. Further documentation would be prepared by your legal counsel, tailored to your specific needs, wishes and circumstances, to assist your fiduciary in carrying out your wishes with respect to these assets.” (4)
Take stock of your bookmarked web pages. What social media emails do you have from accounts you may have forgotten? Start a list of your accounts and their login information (this is a good opportunity to update outdated passwords).
Make a shorter list, this time of the individuals you trust with your assets. Then, buy them coffee and ask if you can give them the information in case of an unfortunate circumstance. We believe it’s never too early to start planning for the unexpected. Won’t you rest more easily knowing your affairs are in order? Then, it’s time for the last step in the process.
Meet with an Attorney
Just as it’s true in estate planning for physical assets, it’s simply not enough to write your wishes and give them to your next of kin. Estate plans require preparation and verification by an attorney. Your digital assets are no exception. To establish ownership and value, meet with a trusted attorney and discuss your assets, your wishes, and what the attorney believes is the best path on which to proceed. This will immensely simplify affairs for family and friends in the event of your death, and you’ll have the peace of mind that your estate plan is legally sound.
Now that you’re equipped with the knowledge and tools to preserve your digital assets, post, Tweet, email, and build your digital legacy to your heart’s content, assured that your selected heirs will be there to carry on that legacy after you.
At the Marquardt Law Firm, our team’s mission is to empower our clients to tax-efficiently protect and preserve assets, reduce family conflict, and maximize government benefits. Schedule a free consultation to find out whether we are the right law firm for you: Call 210-530-4278.
(1) “Managing Your Digital Afterlife” by Sarah Kellogg
(2) “How to Protect Your Company’s Digital Assets” by Jean Murray
(3) “Estate Planning with Digital Assets” by Theresa M. Wade
(4) “Estate Planning with Digital Assets” by Theresa M. Wade