Digital estate planning is a relatively new feature of broader estate management that deals with the handling of digital assets after a person’s death or incapacitation.
Due to the ways in which the world has evolved over the past few decades, a significant portion of most adults’ lives and assets exists online or in digital form. These include social media accounts, digital photographs, online banking, email accounts and even cryptocurrency holdings. Digital estate planning involves organizing these digital assets and making arrangements for their future management or disposition.
The importance of digital estate planning
If you’re intrigued by the idea of digital estate planning, understand that its primary goal is to ensure that your digital assets are handled according to your wishes after your death or incapacitation. Without a clear plan, these assets may become inaccessible, lost or mismanaged. For example, many families struggle to access important documents or photos after a loved one’s passing nowadays because they lack the necessary passwords or legal authority. If you don’t act to make your wishes in this regard both clear and known, your digital footprint could be compromised in any number of ways if you’re incapacitated or you pass away.
A comprehensive digital estate plan should include:
- An inventory of all digital assets, including login credentials and any necessary passwords or encryption keys.
- Clear instructions on how each asset should be handled. For example, whether to close certain accounts, memorialize social media profiles or transfer digital assets to heirs.
- Designation of a digital executor – someone who is entrusted with executing these wishes. This role requires a person who is not only trustworthy but also reasonably tech-savvy.
Digital estate planning is still a relatively new concept, and laws regarding digital assets vary by jurisdiction. It’s important to ensure that your digital estate plan complies with current laws and to consider how access to encrypted data or accounts will be legally granted. As such, seeking legal guidance when crafting your plan is wise.