information contained in documents, such as emails.
Each internet service provider may have different policies for dealing with online assets on death. These policies will have been accepted when the online account was created. A few examples are:
Facebook – since 2009 Facebook has allowed accounts to be memorialised so that family and friends can continue to post photographs and comments on a deceased account holder’s timeline. However, logging into or editing a memorialised account is not permitted.
Google – since April 2013 Google’s inactive account manager allows account holders to decide how their stored data should be dealt with once they have died.
Apple/iTunes – this is a licence only and there are no rights to reproduce content. Account holders are prohibited from passing on details of ID and passwords to others.
Apple/iCloud – these accounts are personal to the account holder and cannot be transferred on death.
Twitter – accounts terminate immediately on death.
What should I do?
Most wills contain a clause dealing with personal chattels. Computer hardware (eg the computer itself) is a tangible asset and falls within the definition of personal chattels, but digital assets are intangible ones and therefore are not covered by the definition.
We suggest you consider amending the usual personal chattels clause in the will to include digital assets, or make a separate provision or leave them to be dealt with as part of your general residuary estate.
To summarise, there are a number of important points to bear in mind regarding digital assets to ensure that they do not add to that £25 billion:
Make a list of digital assets that have financial or sentimental value.
Choose who should deal with the digital assets. Remember this could include access to emails so privacy may be an issue.
Keep records of online accounts, usernames and passwords regularly updated and separate from the will. Consider using a third party provider, such as an online password protection programme, to help.
Make a will and consider digital assets carefully.
For more information about how to protect your digital assets in your will please speak to any of our lawyers in our wills, probate & trusts department.
In my previous digital estate planning post, I posed the question regarding the difference between the decedent in the 1990’s who threw away all his bank accounts, photos, and family letters before death, and the decedent in today’s age who has stored all of this information online and fails to provide the password.
Before answering this question, estate planning is composed of two major classes of decisions: (1) heirs of the estate and (2) fiduciary appointments. Fiduciary appointments typically consist of naming individuals to act in various roles on a client’s behalf upon death or incapacity, such as personal representative/executor, trustee, power of attorney, guardian/conservator, etc. Simply defined, a fiduciary is one who is charged with making decisions on a person’s behalf, either in accordance with specific instructions or based on the best interests of the person represented by the fiduciary.
Keeping this fiduciary concept in mind, we can now jump back to our original question. The simple answer lies in who possessed the information. When information was in a paper format, the decedent was the one who possessed it. However, when information is stored in a digital format in a place other than the decedent’s personal computer, that information is no longer possessed by the decedent. Instead, the information is now possessed by an online service, and is stored in their servers.
Thus, there are two issues central to digital estate planning. First, a decedent may now have fiduciaries which are named outside of their estate planning documents. Second, a decedent’s estate planning documents may not effectively dispose of their digital assets, due to a conflict with the terms of service of the information fiduciary.
Now that we have effectively framed this issue, future installments will examine how these legal issues can be resolved, and whether an outside non-lawyer service is an effective mediator of such issues.
New research shows that almost nine out of 10 Britons have failed to set out details of where their online bank accounts and other personal effects can be found.
As the use of online savings, pensions and investment portfolios grows, so does the danger that their families could lose out on a fortune if accounts cannot be traced.
In total, billions of pounds could be lost in cyberspace, legal experts have warned. They say that writing a will is no longer enough – you also have to draw up a digital legacy.
KEEP TRACK OF ONLINE VALUABLES
The average Briton has £333 in digital assets, according to new research from Saga Legal Services. This includes savings and investments, and credit held in online only accounts, such as shops or gambling sites.
Others have expensive digital music and movie collections stored, or risk leaving private photos or blog posts freely available online for generations to come.
Despite this, 87 per cent of Britons do not have a plan in place for family estates to be able to trace them, and could bequeath wasted time, effort and financial loss to their loved ones, Saga warns.
BEWARE DIGITAL DANGERS
As we spend more of our lives online than ever before, with the number of over 65s using the internet daily quadrupling in the past eight years, we need to be ready for what follows when we die. Emma Myers, head of wills at Saga, says that as the financial implications of not planning your digital legacy are growing in severity, so it should be treated just like a will for your physical possessions.
She says: “In the same way that you would not want your loved ones falling out or being inconvenienced over a missing will when you die, it is also imperative to plan ahead for your digital legacy.”
Facebook has just announced that it is launching a Legacy Contact feature, which allows users to appoint someone to manage their account when they die, and post a final message on their behalf
This is already a problem, with almost eight out of 10 bereaved people reporting difficulties managing a loved one’s online accounts after they die, according to research from Co-operative Legal Services.
It calculates that with hundreds of millions of online accounts and assets in the UK, a staggering £17 billion could be lost in cyberspace.
Even after accounts have been traced, families face further tough decisions determining their loved one’s wishes. Families also overlook social accounts that may have sentimental value, or lose track of online contacts.
PASS IT ON
James Antoniou, head of wills for Co-operative Legal Services, says when people consider how they want their assets to be divided, the first thing they think of is making a will.
Yet all too often people fail to take their digital legacy into account. He recommends writing details of all your online accounts in a sealed letter to be kept alongside your will, addressed to executors.
“This should include references to the usernames and passwords, and answers to security questions.
“You should never put these in your actual will, because it can become a public document after death.”
Facebook has just announced that it is launching a Legacy Contact feature, which allows users to appoint someone to manage their account when they die, and post a final message on their behalf.
Google’s Inactive Account Manager app deletes information after a certain length of time, but this only applies to services such as Gmail and YouTube.
Too many other sites have failed to do this. So you have to take action yourself, because in the online world, you will not leave a paper trail when you die.
It’s a fact of life that we’re all going to die at some point. While it’s not something you probably want to think about, you can make things a lot easier on yourself (and your family) if you get everything in order now. Here’s what you need to do.
Your inevitable demise is hopefully not on your mind too often, but it’s still something you should think about long enough to get everything in order. Doing so ensures that everything in your life is organized so others can see what you want to happen after you’re gone, what you own, and how to handle a variety of situations.
If this sounds daunting, don’t worry too much: being unmarried, without children, and without a useful asset to speak of, I was able to get everything in order in about two hours (I still had a lawyer friend double-check everything to ensure I wasn’t accidentally giving my dog medical power of attorney). The more you own the longer it’ll take, but it’s not nearly as time-consuming as it looks because most of this stuff you probably already have ready to go.
Note: You can do a lot of this stuff on your own, but it’s a good idea to speak with a lawyer about your will, assets, and general estate planning. This guide is meant more to get you acquainted with terms, provide DIY options when applicable, and help you collect together what you need.
Decide What Happens After You Die
Planning for your death is actually two things: what happens after you die, and what happens if you’re ill and unable to handle decisions yourself. Let’s start with taking care of what happens after you die, starting with your last will and testament.
Write Your Last Will and Testament
Your last will and testament is a document that designates what happens with your property, guardianship of your children, and names the person (executor) who carries out your wishes after you die. If you don’t own a lot of property, a simple will is likely all you need.
It’s possible to draft up a simple will on your own, but it comes with its own set of pros and cons. These include problems with outdated information, specific state related tax issues, and how they handle specific trusts. As USNews notes, online wills are a one-size fits all solution, that can’t always account for the complicated situations of real life. However, if you only need a very basic will SmartLegalForms, LegalZoom, or RocketLawyer all provide a simple template for doing so for between $15 and $80. These laws and requirements change often, and if you don’t do it right you might unintentionally give someone more power over your estate then you want. Most simple wills have just a few sections where you can say what happens to your assets, and designate who gets any property you own.
When you’re drafting up your will, you’ll also name your executor. After you die, this is the person who handles your estate (all of your property), finances, debts, and everything else. It should go without saying this is a person you would trust to handle your estate when you’re alive. Once you die, a probate court will officially give power to your executor to handle your affairs. They do not have control over your estate until after you die.
Finally, to make the will legally binding, you’ll usually need to get signatures from at least two witnesses (who aren’t beneficiaries listed somewhere on the will), and it’s advisable to get it notarized by a notary public. You can usually find a notary public at your bank, and they act something like an official witness for legal forms.
If you have a lot of assets that you want to designate to multiple people, or to make sure your will is legally sound, you should speak with a lawyer about getting a more advanced will written up. Things start getting really tricky when finances are involved, and if you have a lot of assets it’s worth at least consulting with a lawyer (if you need help finding a reputable lawyer here’s our guide). I spoke with lawyer Elizabeth D Mitchell of Ambler & Keenan, LLC about the basics of what you can expect from an estate planning firm:
I usually start people out with a form and have them think about who they would name as their power of attorney. From there, we’d look at their assets and arrange for special circumstances. It’s important to remember that estate planning isn’t just what happens after death, it’s also about what happens if you’re incapacitated… What I always tell people is that it costs more to clean up a financial mess afterwards then it does to plan ahead.
Mitchell also adds that although it takes a little time to get everything in order, most estate planning lawyers offer some type of free consultation before they into your plan. This is because once they set up a plan with you, you’ll be dealing with them for the rest of your life so it’s important to know exactly what you’re getting into. Mitchell also recommends people at least speak with a lawyer about writing up their will even if they don’t own a lot of property because it’s possible a single mistake could mess everything up. As the New York Times points out, the law is different in every state, and something as minor as not declaring the document a will out loud will make it invalid in certain states. A lawyer is also handy to set up trusts so your family gets paid out. According to the Wall Street Journal, trusts are increasingly important:
Rick Law, founder of estate-planning firm Law ElderLaw LLP in Aurora, Ill., says estate planners increasingly recommend revocable trusts in addition to wills, since they are more private and harder to dispute. “Every will is like a compass that points toward the closest courthouse,” he says.
A revocable living trust can be changed anytime during your lifetime. After you transfer ownership of various assets to the trust, you can serve as the trustee on behalf of beneficiaries you designate. Provided you do so, there aren’t any ongoing fees.
That said, if you don’t own that much, or you don’t mind leaving it all to one person, the whole process of writing out your own will takes about 20-30 minutes. Photo by Ken Mayer.
Outline the Funeral or Memorial Service
Obviously this step is optional, but if you want something specific to happen at your funeral or memorial service after you die it’s a good idea to get it in writing, and let your family know your wishes. Doing so gets rid of the headache of planning for your family, and ensures you get what you want. You don’t need to go in and plan everything out, but here are a few things worth considering:
If you want a burial, you need to find a grave plot. You’ll need to contact a local cemetery and purchase a plot if so. If you want a specific cemetery or plot, the earlier you do this step the better.
If you want cremation, you’ll work with a funeral director, so contact a local funeral home and arrange any details with them.
Decide if you want to pre-pay for any arrangements so you don’t have to worry about your family paying for anything while they wait to get access to your money. Since the average funeral is around $6,500, so it might be helpful to pay ahead of time.
At this time, you can also decide if you want anything specific in a memorial service, how you want the wake handled, and everything else. It’s also common to add these details to the will if you want to make sure your wishes are followed. Obviously this is a very personal event, and what you want depends a lot on your religious and social background. It’s a good idea to make your wishes known to family members to take the pressure off them when the time comes.
Designate What Happens If You’re Ill or Incapacitated
Just as important as what happens after you die is what happens if you’re ill, incompetent, or incapacitated. For this you need a living will, a power of attorney, and a medical power of attorney. If it sounds a little scary, don’t worry, it doesn’t take a lot of time and by the end you’ll know that you’ll only get the medical support you want.
Designate a Power of Attorney
A power of attorney is the person who can attend to financial or legal matters if you fall ill or are unable to handle them for yourself. It’s a good idea to choose a power of attorney so that they can attend to your financial and legal issues immediately after you fall ill. The power of attorney expires when you die, and the control of your finances typically shifts to the executor you named in your will. In some cases this is the same person.
The form to designate a power of attorney varies by state, but if you want to do it yourself you can get a document from the same services where you did your will (SmartLegalForms, LegalZoom, or RocketLawyer). If you’re giving one person complete control over everything you can likely manage to fill this out yourself, but if you want to limit what they can do it’s likely best to consult with a lawyer. Photo by Andy on Flickr.
Prepare a Living Will and Designate a Medical Power of Attorney
Every state has different paperwork for your living will, and different guidelines (you can grab paperwork specific to your state here). Essentially, each form allows you to designate what type of medical care you want to receive if you can’t speak for yourself, as well as designate if you want to donate any of your organs to science. Again, you’ll usually need two witnesses when you sign, and it’s wise to get it stamped by a notary. When you’re finished, keep a copy for yourself, and give copies to your physician, a family member, and your healthcare agent (your lawyer will also keep one if you use one). Additionally, if you do not want CPR or ACLS, you want to fill out a Do Not Resuscitate order with your doctor.
Not every medical procedure known to man is covered in the living will, and for those unexpected occurrences you may also want to designate a medical power of attorney (also known as an agent, attorney-in-fact, health care proxy, or health care surrogate depending on where you live). This person can make medical choices for you if they’re not included on your living will, or if you give them the power to override your previous choices if the circumstance warrants it. Additionally, they can also get the right to see your medical records (which is helpful if you choose anyone other than direct family), apply for Medicare on your behalf, and make choices about any medical procedures when you can’t. Again, this differs by state, but you’ll often name a medical power of attorney on your living will. Of course, before you give someone the power of attorney you’ll want to go over what type of medical treatments you want and don’t want, and make sure they agree to follow your wishes.
The living will and health care power of attorney forms are important for everyone to fill out. I did mine in about 10 minutes. With these completed, you’ll have the peace of mind that you’ll get the medical care you want (or don’t want) in just about every circumstance. Again, a lawyer is helpful here if you’re unclear about anything. If you’re not sure what type of treatments you’d like when you’re incapacitated you should speak with your doctor. Photo by Social Innovation Camp.
Organize Your Finances, Life Insurance, Bills, Debts, and Everything Else
While the bulk of your assets are distributed on your will, you still have a lot of financial obligations out in the world. Naming an executor on your will and a power of attorney is just one step. You’ve probably already done this, but it’s also important to get all your finances organized so your heirs can actually find what they need. According to the National Association of Unclaimed Property, around $32.9 billion assets are currently unclaimed because the state took hold of them instead of the family. So, whether you decide to write up your will with an estate planner or not, you still need to get everything in order.
Two of the most important documents are your life insurance policy (especially policies from former employers) and retirement plans (as well as pensions and annuities), because both are easy to overlook. If your heirs don’t know these accounts and policies exist, they can’t claim them and the funds usually go to the state. So, gather up your various policies and keep them together.
If you don’t have a life insurance policy, you might want to get one, and we’ve walked you through what you need before. A life insurance policy isn’t just about covering your salary after you die, it’s about helping your family pay for funeral costs, car loans, credit cards, mortgages, and everything else.
To make the process easier on your family when you pass away, it’s also a good idea to gather together all your debts (especially big ones like your mortgage, car loans, or credit cards) in one place so your heirs can pay your bills for you while they figure everything else out. You likely already do this, but it’s good to keep everything together so they don’t have to search for it. To make the process even easier (and skip over any conflicts with power of attorney), you can add a family member to at least one of your bank accounts so they always have access to some of your funds.
If you have a lot of sources of income, it’s a good idea to meet with a financial advisor to get everything organized. You can find one through The National Association of Personal Financial Advisors. With your financial advisor you can set up beneficiaries for retirement plans, make your accounts accessible, and create spending plans for your surviving family.
Secure Your Digital Life (and Pass the Keys onto Someone You Trust)
The reason this is an important step is not just to give your heirs access to your bank accounts, it’s also so they can shut down services you don’t want around. For example, Facebook can memorialize your page if you want, but if you don’t want that digital record sticking around, you might make a request to your heirs to delete it outright. Likewise, if an heir wants access to your Google account and you don’t give them the password, they’ll need to provide a name, address, photo ID, email, and death certificate. Which is to say, it’s a lot easier for your family if you just give them your passwords.
So, when you’re putting together your list of usernames and passwords, include instructions for how you want those accounts handled, including if you want them to do anything specific with your home computer. It might seem a little weird, but if you want a little control over how your digital life is handled after you die, this is the only option. If you’re using a password manager like Lastpass then you can just look in your password vault for a full list of all your accounts and passwords. It only takes a couple of minutes to copy the ones that really matter.
Set Up a Master File of Everything
Once you have all your paperwork sorted, wills filled out, and everything else, it’s time to pack that all into master file you share with a close family member or friend. Remember, this includes everything about your life, so keep it in a safe place (or in a safe deposit box), and share it’s location with your family. After completing the steps above, you should have everything in order, but here’s what you should include (List culled together from UC Berkeley, The Wall Street Journal, and our own “In-Case-of Emergency” document):
Letter of instruction
Social security numbers/cards
Passports (numbers and expiration dates)
Driver’s licenses (number, expiration dates)
Names/address/telephone numbers of healthcare professionals
Healthcare proxies/living wills
Medications (dosages, name of prescribing physicians, pharmacy, address/telephone
Social worker or caseworker names and contact information
Passwords, web sites, and other digital information
Income sources (retirement and/or disability benefits, Social Security, etc.)
Financial assets (institution names, account numbers, address/telephone, form of ownership, current value) of cash, bank accounts, stocks, bonds, mutual funds, money market funds, retirement and pension plans, IRAs, annuities, life insurance
Real Estate (property addresses, location of deeds, form of ownership, current value)
Other assets (location of items/titles/documents/form of ownership, current value) including automobiles, boats, inheritances, precious gems, collectibles, household items, hidden valuables/items in storage, loans to family members/friends
Liabilities (Creditor institutions, address/telephone, approximate debt) of mortgages, personal loans, credit cards, notes, IOUs, other).
While some of these records need to be physical copies (like your birth certificate), others, like contact info, a copy of your will, and property information can be digital, so use whatever system you’re more comfortable with. Whatever you decide, keep everything organized in a folder together, and let a family member know where everything is.
If you need a little help getting everything organized, webapps Everplans, Get Your Shit Together, and CNN’s guide to estate planning are great resources that guide you through more of the specifics. As always, if things get too complicated, don’t hesitate to contact an estate planner for help—most will offer you a free consultation.
Our lives are increasingly conducted online with many of us managing bank accounts, utility bills and much of our correspondence online these days. Many people now consider their social media portfolio to be among their most personal assets. With this trend only increasing across all age groups, the difficult question of what happens to our digital presence after we die has become more and more important.
The BBC recently reported that, Co-operative Funeralcare, one of the UK’s largest funeral providers, had recently conducted research into the question of a “digital legacy”, and its conclusions suggest that most of us do not make any provision for management of our online accounts after we die. For example, while almost all bank customers now have the facilities to manage their accounts online, only one in four make suitable arrangements to pass on the details to those left to wind up their estate. 80% of those who attempt to manage online bank, utility, shopping or social media accounts following a death reported problems in doing so, leading to unnecessary stress and complications at a difficult time.
It is never easy to discuss arrangements for end of life, but as with any estate planning, the most important thing is providing peace of mind and the knowledge that your estate will be managed in line with your wishes. Online assets should be viewed just like any other asset in this regard. Whether this means leaving the necessary details to manage accounts in a sealed letter alongside your Will, or in some other secure way, making suitable arrangements now ensures that you can be confident that your loved ones will be able to manage your estate without unnecessary difficulty.
Meanwhile, social media websites continue to adapt their offering to provide options for their users to control their online presence after their death. Last month Facebook® unveiled legacy settings, giving users the option to delete their account permanently upon their death, or to pass control of selected aspects of their account to nominated friends or relatives. Memorial pages, where friends can post comments and tributes about a deceased, are a popular alternative. Some technology companies even allow users to prepare messages to be rolled out following their death, often many years into the future. Given the rapid pace of technology, and the growing importance that we place on our digital presence, this market seems destined to expand and change for years to come.