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Digital Assets Pose New Challenges

Digital Assets Pose New Challenges

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Your heirs may find themselves at the mercy of thieves if digital assets are not protected.

When I first heard a speaker talk about managing digital assets, I dismissed it as “I don’t really have any of those…”

It that is your outlook on digital assets, think again: its almost impossible today to not have a significant digital footprint.

Your heirs may find themselves facing some problems that are difficult to solve, if your digital assets are not organized, according to the White Mountain Independent in “Is your ‘digital estate’ in order?” Among the problems, is the chance of hackers trying to obtain your assets.

Here is a list of your personal accounts that may be online:

  • Financial accounts: banking, brokerage, bill-paying utilities;
  • Virtual property: credit card points, frequent flyer miles, cryptocurrency;
  • Business accounts: eBay, Amazon, Etsy; stock photo accounts;
  • Email accounts: Gmail, Outlook, Yahoo;
  • Social network: Facebook, Twitter, LinkedIn, Instagram; and
  • Online digital storage: Dropbox, Google Drive, iCloud.

Those are many assets to protect. Where do you start?

First, create an inventory. Use the categories above or create your own. However, you should make it organized. Think about using a password storage program, like Lastpass or Nortons. They are inexpensive and incredibly handy. Make sure the password to that is very good.

Document your wishes for how you want your digital assets to be managed. If you don’t specify this, you may be leaving a wide-open arena for long legal battles. Your heirs and beneficiaries may never gain access to them. Hackers might go after them and use your identity. Your heirs may also have to engage in an expensive and protracted battle with a social media giant with costs eating into their inheritance.

Provide for managing digital assets on your Power of Attorney and Will. This is a relatively new area, but you can provide power to your attorney in fact and will for management of such assets. Not all states recognize this position, so you’ll want to speak with a local estate planning attorney to find out what the laws are in your state.

Maryland has the Maryland Fiduciary Access to Digital Assets Act, which provides powers for the executor in this regard.

You will also need to go through all of your online accounts and learn what each platform requires, in the instance of the account owner’s death.

Review your plans, especially as you add new digital assets.

An estate planning attorney can advise you on creating an estate plan that fits your unique circumstances, including your digital accounts.

Reference: White Mountain Independent (Oct. 26, 2018) “Is your ‘digital estate’ in order?”