What Digital Assets Should I Include in an Estate Plan?

When planning your estate, you may think of physical property such as your house, car, cash, or jewelry. Making an estate plan for these types of assets is important. But what about your digital assets?  

Digital estate planning is more important than ever as more parts of our lives are increasingly online, from financial accounts to family photos. To ensure that all your assets are accounted for, your estate plan should include digital assets in addition to your more traditional assets.

“You want to consider all of your assets [in estate planning],” says Ohio estate planning attorney Jay E. Michael. “Whether the assets are digital… any asset needs to be addressed. Any and all.” 

But what are digital assets, and how do you make an estate plan for them? This article will address those questions and help point you to legal help in planning your estate. 

What Are Digital Assets?  

A digital asset is anything in digital format that has value and can be owned by an individual or company. Digital assets include:

1. Digital Hardware

This is anything on which digital information is stored, such as computers, hard drives, flash drives, smartphones, tablets, digital cameras, or other digital devices. 

2. Non-Monetary Digital Assets

Photos, documents, videos, games, or music that you have stored digitally or in a cloud. These types of digital assets don’t have monetary value in themselves. However, they do have sentimental value and are often things you want to ensure are left to your loved ones and beneficiaries. 

3. Online Accounts

You may have many online accounts for different aspects of your life, from finances to communication. Online accounts include:

• Email accounts 
• Social media accounts  
• Messaging accounts 
• Online banking accounts 
• Online credit card accounts 
• Other online financial accounts, including investments and stocks 
• Online marketplace accounts (such as Amazon) 
• Online storage accounts (pictures, videos, music) 

4. Intellectual Property in Digital Format

This could include logos, videos, or other artistic works you’ve created online, such as music, pictures, and stories. 

5. Domain Name

A domain name is the name of your website. It’s one of the main ways your website is identified and accessed. 

6. Cryptocurrency

Cryptocurrency (crypto) is any digital currency that uses a decentralized transaction verification and management system (blockchain) instead of a central banking authority. Cryptocurrencies are secured through cryptography or encryption (coding methods that make data inaccessible to everyone but the intended user). The most popular type of cryptocurrency is Bitcoin. 

7. NFTs

NFT stands for “non-fungible token.” NFTs can be anything from images to music videos to games. They are digital assets created by taking a digital object (an image, video, etc.) and giving it an identifying code through encryption. The code is unique to that digital object and allows individuals to own that specific digital object.

For example, instead of just viewing a picture of your favorite superhero, you can own that image by making it in an NFT. Like cryptocurrencies, NFTs are encoded on a blockchain. The similarities end there, however. Cryptocurrencies, like U.S. dollars or other currencies, can be exchanged for one another. I can exchange my $10 bill for your two $5 bills. This ability to be exchanged is called “fungibility.” NFTs are not like money in this respect; they are unique items that can’t be exchanged for one another. This is why they’re called “non-fungible.” 

8. Accumulated Points

You may have points through loyalty programs with hotels, airlines, etc. 

Five Steps To Add Digital Assets to an Estate Plan  

In many ways, creating an estate plan for digital assets is like creating an estate plan for any other assets you own. Whether making a plan for your real estate or your cryptocurrency, you’ll want to: 

1. Inventory

First, make a complete inventory of your assets, digital and non-digital.

2. Beneficiaries

Decide how you want to distribute the assets and who your beneficiaries will be. 

3. Create a Will

Create a last will and testament that specifies your wishes. If you already have a will addressing your other non-digital assets, you can add an amendment (called a codicil) that accounts for the digital assets.  

4. Appoint a Digital Fiduciary

When creating your will, appoint a digital fiduciary. “Digital fiduciary” is a broad term that could refer to two types of personal representatives:

• Power of attorney: A person authorized to make decisions about your digital assets on your behalf if you become incapacitated. You can also appoint a power of attorney through a directive instead of a will.
• Digital executor: A person appointed to distribute digital assets as specified in a will after the person’s death. 

5. Make a List

Put your digital account information in an accessible, safe place. Ensure your digital fiduciary knows how to access the information when you die or are incapacitated. Include passwords, private keys/PINs, and any other account information that will be necessary for your wishes to be followed. 

Are There Digital Property Laws?  

There is currently no law at the federal level specifically concerned with digital fiduciary responsibilities. However, there is a degree of uniformity concerning digital fiduciary duties thanks to the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA). Legal experts with the Uniform Law Commission created this model law in 2015. Since its creation, RUFADAA has been adopted by most states and the District of Columbia.

RUFADAA sets guidelines for digital fiduciaries in managing a deceased or incapacitated person’s digital assets. Generally, the law allows fiduciaries to access the deceased person’s digital assets and accounts as long as they are authorized by an estate planning document. If a will or other estate document doesn’t explicitly grant access, but the fiduciary thinks access is necessary to settle the estate, they can seek a court order to gain access or look at the service provider’s terms of service. 

In addition to RUFADAA, other federal and state laws are relevant to the digital estate planning process. For example:

• Your state’s estate planning laws and probate process 
• Data privacy laws that protect your electronic communications  
• Criminal laws that target identity theft and unauthorized access to your accounts 

Digital fiduciary duties can be complex. If you’ve been appointed a digital fiduciary, it’s a good idea to speak with an estate planning attorney about your role and the laws in your state governing it. 

Questions for an Estate Planning Attorney 

Consider speaking with an estate planning attorney if you’re trying to create an estate plan that covers your digital assets. An attorney can assist you through estate planning, preparing legal documents like a will and directives and ensuring nothing is left out. 

Visit the Super Lawyers directory to find an experienced estate planning attorney in your area.