It’s 10 o’ clock. Do you know where your digital assets are?  And even if you do, can someone you trust access them for you if you can’t? Does your estate plan include measures that will enable your agent under power of attorney, trustee, or the executor of your estate to identify and access these? Dionysios Pappas, an attorney with the law firm of Vasiliadis Pappas Associates, notes that “prudent estate planning includes carefully crafted provisions in your power of attorney, will, trust and other legal documents that will ensure access to your digital property by your fiduciaries and other appropriate persons”. 

For starters, learn and implement measures that will enable you to identify and efficiently manage this ever-growing list of digital assets. Doing so is more important than ever. From smart home devices to online investments and bank accounts, we’ve gone way beyond using the internet to email family and social media to connect with friends.

In a recent survey, Americans said they value their digital assets at an average of $119,516. Despite this, more than three-quarters of respondents said they have little to no knowledge about digital asset planning.

Today, understanding which digital information and accounts you can legally leave to your loved ones is crucial to protecting your assets, while laws governing these online assets continue to change. However, legally gaining access to digital assets and encoded financial data can present challenges for anyone other than the original owner.

Four main obstacles will hinder access to a family member’s vital personal data and digital assets:

  1. Passwords

Without knowing your passwords, personal representatives and family members may not be able to access your data and property stored on a computer or smartphone, or in the cloud and in online accounts. While experts can easily bypass some passwords, others – like for cryptocurrency wallets – can be practically impossible to recover.

  1. Encryption

Your digitally stored data often undergoes encryption for an additional layer of protection. Encryption can happen at many levels, from a single file on your device to large amounts of stored information in the cloud. In particular, smartphone technology may be difficult to decrypt, so if you have not transferred your data to an external hard drive or USB and shared it with other family members, the digital information may not be accessible.

  1. Privacy laws

In general, federal data privacy laws prohibit turning over electronic communications by online account service providers unless you are the owner or have the owner’s legal consent. Therefore, social media sites and digital storage companies may lock down content without legal documentation sharing the circumstances under which trusted friends or family members can access it. Taking a digital service provider to court to retrieve treasured data is generally cost-prohibitive, so lawful consent from the owner can prove critical.

  1. Criminal laws

State and federal laws do not allow unauthorized access to computer systems and private data. These laws protect consumers against identity theft and fraud, but they also can create enormous obstacles for loved ones who need to gain access to a decedent’s digital information and assets. If you do not give express permission to your fiduciaries, representatives, or family members in your estate plan, they may never be able to access it.

Ways to Access Digital Assets After a Death

Make a list of your digital assets and include important online accounts (social media, banking, bill pay), passwords, and digital property, including cryptocurrency, money transfer apps, and domain names. Store this list in a secure place and maintain its accuracy. Numerous reputable password management apps, such as LastPass and Dashlane, are free and available to make this task easier. On your social media accounts and smartphone, you should also consider setting up legacy contacts.

Many digital assets you think you own, you may not. For example, we tend to carelessly accept end-user license agreements (EULAs) without understanding that a “purchased” item is a nontransferable license to use, but not own, the asset. If you use software of virtually any sort, from PayPal, Instagram, and Google apps to Netflix and Kindle and beyond, your loved ones will not automatically have a right to those accounts after your death.

If you store data in the cloud, it is wise to back it up in another location. Secure online safe deposit boxes or digital vaults tied to your banking institution store identification, legal documents, business contracts, finance, tax, and insurance information. By adding emergency contacts, you can generally make it easier for those individuals to access your documents after your death. 

You may also want to scan electronic copies of paper records to store on an external hard drive and in a secure location to keep items updated and permit fiduciary, representative, and family access with fewer obstacles. Relying only on the cloud for backup can create future problems.

Legal Assistance

Digital asset management is one of perhaps many considerations persons overlook in their estate planning. The lawyers at Vasiliadis Pappas Associates incorporate appropriate provisions in the powers of attorney, wills, and trusts that they draft for their clients.