You probably know that estate planning is an essential part of your financial planning. Having a Will, a Power of Attorney, and an Advance Health Care Directive ensures that if something happens to you, your loved ones can take care of you and your assets in alignment with your wishes.
As recently as 10 or 15 years ago, a basic estate plan is all most people needed when it came to making arrangements for your assets. These days, however, most people have digital assets that may not be adequately addressed by basic estate planning documents.
Maybe you only have an email account and a couple of social media accounts. Or, like many folks, maybe you have a trove of digital books, music, financial accounts, website domains, and/or cryptocurrencies like Bitcoin. What is going to happen to these things when you die?
Fortunately, Alabama has passed the Revised Uniform Fiduciary Access to Digital Assets Act, which gives people the ability to grant a fiduciary the power to access digital assets in their Will, Trust, or Power of Attorney. Our documents specifically include this grant of power. This Act makes dealing with digital assets much easier, as before the Act, a Personal Representative often had to procure a court order to access digital assets.
Some digital providers — such as Google and Facebook — also now have an option of designating a successor individual who may access your account after you are gone or incapacitated.
According to Kiplinger, here are five steps you can take to start getting your digital estate plan in order:
1. Take inventory of all your digital assets. Include any online accounts, no matter how basic or complex.
2. Make sure you have username and password information documented in a secure place. You may want to consider using a password management tool. Designate a trusted individual who will have the ability to access your login information after you die.
3. Determine if online accounts offer a way for you to spell out your legal custodians and, if so, complete any required electronic forms.
4. Update your will, trust, and power of attorney documents to authorize the individuals you would like to serve as fiduciaries to access your digital assets. Indicate who will have access to what.
5. Enlist the support of professionals to help you manage the estate implications of your digital assets. An estate planning attorney and a financial advisor can work together to help you develop a comprehensive plan that matches your legacy values.