Have You Planned For Your Digital Legacy?
As estate planners, we often receive confessions from our clients that they had a tough time getting the motivation to have their estate plans drawn up. There seems to be an inherent inertia which affects most people when they turn their mind to the morbid topic of their own death, and are forced to ask the question: “what will happen when I am gone?”
One of the common complaints we hear is that the work required to obtain the various pieces of information necessary in order to prepare an accurate and effective estate plan is daunting. The daunting nature of the information gathering phase of an estate plan is often exacerbated when we ask if they have thought of cataloguing their digital assets, to which they invariably reply: “what is a digital asset?”
Digital assets are assets which form part of your estate (which may or may not have a determinable value), but which are not usually accessible or transferrable by anyone other than you, because of the restrictive terms and conditions that are attached to the third party service providers who host such digital assets. Common examples of digital assets include your Google, Outlook, Facebook, iTunes, Twitter, Instagram and DropBox accounts and their contents.
The problem which typically arises when we discuss planning for digital assets is that it requires the individual to give consideration to the extent of their digital presence, and to decide what should be done with their various digital assets upon their passing. To date, our experience has been that the vast majority of people do not have an accurate understanding of the extent of their digital estate, i.e. they do not have a running list of their various accounts, passwords, and contents, making inventorying and planning somewhat difficult.
Fortunately, as part of our estate planning services, we offer assistance with the identification and curation of digital assets. We find that once we sit down and systematically identify key digital assets and a person’s wishes, the digital estate plans nearly write themselves. Once an individual has considered who they would like to name as their digital executor (often a different person than the person named as executor and trustee), the key elements of an effective digital estate plan are nearly fulfilled. Unfortunately, very few people are aware of the value of their digital assets, whether economic or sentimental, and as such many people pass way without giving thought to the digital assets they have left unclaimed in the ether.
While many Canadians still do not give priority to their digital estate plans, a 2011 survey conducted by McAfee in the U.S. revealed that the average online user has more than $37,000.00 USD in under-protected digital assets. The U.S. Government has been paying attention to these numbers and now recommends that its citizens create a “Social Media Will”, which we also advocate for our clients who have precious digital assets that they wish to preserve. We also recommend this for our clients with digital assets they may wish destroyed upon their passing.
Creating a simple document containing your various online accounts (financial accounts excepted for security reasons) with their passwords, security questions and other data which would allow a digital executor to carry out your instructions, is an effective tool for dealing with digital assets. However, to avoid potential breaches of security, it is advisable to consider keeping the list in a secure offline location (such as a safety deposit box). Another option would be to make use of one of the various password management software suites, such as 1Password, provided that your digital executor has access instructions to such software. While the use of password management software is an incredibly practical and easy to implement solution, any online solution, regardless of the encryption and safety protocol, will be vulnerable to online attacks. We recommend that people consider this before making use of such software.
A final step in creating an effective digital estate plan, and one that is often overlooked, is confirming the terms of service for each digital content host where the relevant digital asset is located. A number of articles have recently focused on Facebook’s controversial memorializing policy for its deceased users’ accounts, but the bigger concern relates to legal uncertainty arising from the user’s personal representative (or digital representative) accessing the deceased’s account. Such access is frequently contrary to the terms of service for most digital content hosts, and therefore potentially in contravention of legislation in certain jurisdictions, notably the U.S.
While we do not currently have any legislation in British Columbia governing access rights to the digital assets of a deceased, legislation is being pushed through a number of states in the U.S., e.g. Delaware, granting access rights to digital assets for the family of the deceased. While some people are applauding this legislation, ask yourself whether you would want your parents or siblings having access to your private emails and social networking accounts upon your timely (or untimely) demise? Depending upon your answer, you may now understand the benefit of creating a digital estate plan.
Aside from privacy concerns, many of our clients also wish to try and preserve their online audio, visual and textual assets for future generations. For almost every generation after the Baby Boomers, family heirlooms such as photos and letters are overwhelmingly becoming stored online, leaving the question as to their treatment a pressing concern for those concerned with their digital legacies.