Digital assets are a category of assets that are commonly overlooked but play a crucial role in your estate plan and the legacy you leave behind at your death. Understanding your cyber legacy is essential in this context. It is all right if you did not consider these items when you first created your will or trust; such a mistake is surprisingly common and, luckily, easy to correct.
What are digital assets? They include all of the following:
Such digital assets often carry significant real-world value and, in some cases, generate substantial income. Examples include cryptocurrency wallets, domain names (URLs), monetized YouTube channels, influencer accounts, and digital business platforms. These assets may represent a meaningful portion of your estate, sometimes even its most valuable components. You can no longer afford to adopt a wait-and-see approach to planning your cyber legacy. Whether or not you proactively plan, your legacy now includes more than just the monetary inheritance, family heirlooms, and personal property you intend to pass along. In today’s world, you must also consider and create a plan for your digital assets.
To that end, here are three tips to help you create or update a plan to manage, transfer, or preserve your digital assets properly as part of your cyber legacy.
1. Inventory your digital assets. Make a list of all the online accounts you use. If you run a business, be sure to include spreadsheets, digital records, client files, databases, and other digital business documents. Not only will you need this information for your estate plan, but it will also play a crucial role in any business succession plan you create. If it exists online or in the cloud, connects to it, or pertains to it, put it on the list for your attorney and your trusted decision-makers (agent under a financial power of attorney, executor or personal representative, or successor trustee). This list can act as a critical resource when someone needs to step in and manage your digital assets, solidifying your cyber legacy.
2. Designate a Digital Fiduciary (Sometimes Called a Cyber Successor): This is someone you trust who can access your online accounts and business on your behalf if you are incapacitated or after your death. In most cases, this person will also serve in a traditional fiduciary role, such as your agent under a power of attorney, trustee, or personal representative, depending on timing. Access to digital assets is governed by state law (such as the Revised Uniform Fiduciary Access to Digital Assets Act, or RUFADAA, enacted in most states) and the terms and conditions of each platform. You should keep your access information secure and consider using the online tools offered by providers (such as Google Inactive Account Manager or Apple Digital Legacy) to ensure your fiduciary can act quickly and legally, preserving your cyber legacy.
3. Determine the necessary tools to properly record and carry out your wishes and ensure that your legacy continues as you want. Depending on your unique situation, it may be advisable to fund some of your digital assets into a trust or even include specific access in a power of attorney. We can help you determine the best way to protect and pass on your digital assets, select your trusted decision-makers and beneficiaries, and ensure the right tools are in place so your assets are accessible when needed. The laws in this arena are evolving, so any past planning needs to be reviewed and possibly updated.
Potential Pitfalls of Failing to Plan for Digital Assets
The worst thing you can do is nothing. Inaction could result in the loss of digital family photo albums, disruption of your business if you are incapacitated, or worse, affecting your cyber legacy. If this process feels daunting or you are unsure where or how to start, call us. We can help you identify, track, and protect your digital assets, giving you peace of mind.
(By Appointment Only)
14425 Falcon Head Blvd
Bldg E-100
Austin, TX 78738
