Discover how to protect and pass on your digital legacy in today's interconnected world with our comprehensive guide to electronic estate planning.
Creating an Electronic Estate Plan: A Must for the Digital Age
When we think about estate planning, most of us envision a will, power of attorney, health care directive, and a trust. However, in today’s digital world, an estate plan isn’t complete without addressing our digital assets.
From social media accounts and email to online banking and cryptocurrency, our digital footprint continues to expand. Without proper planning, these assets can become inaccessible or lost to loved ones. In this guide, we’ll walk through the essential steps to create a secure and effective electronic estate plan.
An electronic estate plan is an organized system for managing digital assets in the event of incapacity or death. It includes critical login credentials, online financial accounts, and digital files that hold sentimental or monetary value.
Key components include:
Taking small, actionable steps can simplify the process. Here’s how to start:
List all your digital assets, from financial accounts to online photos. Include usernames and security questions where applicable. Use this Digital Estate Planning Checklist to ensure you don’t miss anything.
Manually tracking passwords can be overwhelming and insecure. Instead, consider a password manager like LastPass or Bitwarden, which securely stores and organizes login information.
A digital executor is someone who will manage your digital assets. Discuss responsibilities with them and provide legal authorization in your will or trust. While not legally recognized in all jurisdictions, specifying a digital executor can offer clear guidance. Learn more about digital executors here.
Different platforms have unique policies on handling accounts after death. Familiarize yourself with them:
Documents like wills, insurance policies, and medical records should be stored securely. Options include:
Another resource that can help organize and store important documents is EverPlans, which offers a free trial.
Speak with an estate attorney to ensure your will, trust, and power of attorney cover digital assets. Some states have adopted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which governs digital estate planning. Review your state’s laws regarding digital estate planning here.
Your digital assets and passwords change frequently. Set a reminder to update your digital estate plan annually or after major life changes. Keep your executor informed about these updates.
Inform trusted individuals about your digital estate plan, including the location of your digital asset inventory and how to access it. Discuss your plan with your designated digital executor and key stakeholders to ensure they understand their responsibilities.
An emergency document is a consolidated guide that allows loved ones to access crucial details quickly. It should include:
Your electronic estate plan isn’t static—update it annually or after significant life events. Hold a family meeting to review the plan and ensure your executor understands their role. Test your plan by having a trusted family member attempt to follow it and identify any gaps.
A well-structured electronic estate plan ensures your digital assets are protected and accessible to those who need them. Whether it’s safeguarding financial accounts, preserving memories, or ensuring loved ones can access crucial information, taking action today will save headaches tomorrow.
Need help getting started? Ignite Financial is here to guide you through the process of securing both your traditional and digital estate. Schedule Your Free Planning Consultation Today!