Who Needs a Digital Witness?
We do pretty much everything online these days. Even if you are resistant to the call of social media, you may still have to interact with digital tools to access your accounts, sign paperwork, and purchase items. Your relatives are sharing photos online and your financial advisor is gently nudging everyone onto their online portal for account information and servicing. As you move ever so slowly toward the digital realm, it is fair to ask yourself a few questions about digital assets.
To start, what comes to mind when you hear the term digital asset? The Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) defines digital assets as electronic records in which an individual has a right or interest. Laws governing digital assets are very new and viewed as a grey area by many estate attorneys. If you are not careful to define your own digital assets, you may lose cherished memories such as pictures or videos that you would rather leave in your family’s possession. On the flip side, remember those awkward pictures from Spring Break ‘99? Do you really want those floating around the internet once you are gone? Well, if you are not careful those embarrassing moments may live on forever. Now could be a good time to start thinking about the digital legacy you want to leave behind.
We spoke to a number of local estate attorneys who generally agree that the order of priority for determining what happens to digital assets at death is as follows:
- Through directions for disclosure to designated recipient(s) via the online tool associated with provider;
- Through provisions in estate documents; and
- Via terms of service agreements with providers.
You may think you have all of your estate documents in order, but what happens to your digital assets once you are gone? Many providers have online tools that dictate who will take over your accounts. We believe it is important to become familiar with these tools and be proactive in designating someone to have access to your digital assets and devices. If there are no estate planning documents authorizing consent, the provisions of the term of service agreement for each provider are the final means to provide access. At this time, establishing direction through a provider’s online tool has priority over estate documents. Provisions are even being included in powers of attorney to designate a trustee who will have power over said assets. In addition, a letter of instruction to be followed upon death can help ensure that your personal desires are followed. For example, if you want to have your Facebook profile memorialized rather than deleted, you could express those wishes in such a letter.
Do you know off the top of your head how many digital assets you have? Maybe you know some of the more common ones, like Instagram, Twitter and Pinterest. However, what about the ones that are less obvious? Websites like Shutterfly will allow a family member to access the account of a deceased person if they can provide a death certificate and a power of attorney. Once you start thinking about it, you may find that you have more digital assets than you think, which is why it is essential to create a digital inventory list. This list should include all of your digital assets and should be updated at least annually. Practically speaking, you should also keep a separate list of usernames and passwords. Make sure to keep both lists in a safe and secure place in password protected spreadsheets or by using a password manager software such as LastPass. Just make sure not to forget the passwords to your spreadsheets!
If you have any questions on setting up your own digital inventory or would like to learn more, please reach out to our financial planning department here at West Financial Services, Inc. Additional articles regarding different digital assets and how to manage them yourself will be posted to our website in future months.
Referrals of family, friends and colleagues who may benefit from financial planning and investment management guidance are always welcome. Thank you for recommending our firm.
To view other articles in the February 2020 Financial Planning Focus newsletter, click here.
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