When you begin thinking about estate planning and which assets to leave to certain family
members or friends, the china, photo albums, or expensive jewelry may come to mind. But what
about your Facebook account, your online banking account, or a personal website? As we
increasingly rely on technology for our social, consumer and business activities, it’s essential
that individuals include their digital assets in the legal documents that protect their legacy. Here
are a few things to think about when planning ahead in the digital age.
1. Know what your digital assets are. Computers, iPhones, and hard drives are tangible
assets, but the non-tangible electronic data they contain falls under the category of digital
assets and is often password protected. These assets range from ones of pure sentimental
value, like family photos on social media sites or email correspondence, to assets that
carry monetary potential – such as PayPal accounts, company websites, digital portfolios,
and more. In fact, a 2013 McAfee study showed that the average consumer has digitally
stored assets worth approximately $35,000. Unfortunately, an estate executor may be
unable to pay certain bills or may even be unaware of their existence in cases where this
digital property was left out of an estate plan. To prevent this, take time to make a
complete inventory of your digital assets and what should be done with each of them at
the time of your death or disability. Digital keys, passwords, and answers to security
questions on digital wallets are crucial.
2. Understand your service user agreements. We tend to click “I have read and accepted
these terms of service.” when we sign up for online accounts without thinking of the
implications these agreements may have on our loved ones who are tasked with settling
our estates after we’re gone. While Facebook allows you to designate a “Legacy Contact”
to monitor your account if something happens to you, Yahoo! specifically states that user
accounts may not be transferred to a different user and will be permanently deleted with
all content upon proof of a user’s death. It’s also important to recognize that eBooks or
iTunes files are licensed to – not owned by – the consumer and may not be given away at
death like other assets.
3. Discuss legal directives for digital assets with your attorney. Discuss your digital
assets with your attorney to make sure that you, your estate, and your beneficiaries are
protected. You may need to incorporate language in your wills, trusts or powers of
attorney to account for these assets. It’s always discouraging to hear of parents who went
through 8 weeks of court processes to gain access to a child’s computer or a spouse who
was denied their loved one’s records – not because the deceased denied them access, but
simply because those digital assets were not considered in their estate planning.
While it may be burdensome to regularly manage your digital assets, consider making it a yearly
or quarterly habit to download online pictures, family videos or documents – especially ones
from accounts that will be deleted by the service provider at the time of your death. Also
consider leaving a list of usernames and passwords in one secure location. If you keep your list
online, file away instructions on how to retrieve them. There are many online providers where
you can store all of your usernames and passwords. Finally, for true business enterprises, make
Linda Melancon | (225) 744-0027
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July 2019
sure that you have a qualified appraiser value your digital assets for tax and estate planning
purposes.
Many individuals already have estate planning documents that don’t mention directives for
digital assets. Living in the digital age may mean that some of your most important records
aren’t in your home where a successor can walk through and find them. Don’t wait until it’s too
late to make your digital assets a part of your legacy!
The information provided is not intended to be legal advice and does not constitute any attorney/client
relationship. You should consult with an attorney for individual advice regarding your own situation.
Ms. Melancon is an attorney with Legacy Estate & Elder Law of Louisiana, LLC with offices in Baton Rouge and Lake
Charles, LA. The primary focus of her practice is estate planning, probate, special needs planning, and elder law. For
more information or to attend an upcoming estate planning seminar, call her office at (225) 744-0027
