Safeguarding your digital assets is paramount in the ever-evolving digital landscape. At our estate planning law firm, we recognize the significance of proactively addressing cybersecurity risks. As technology advances, so do potential threats to your valuable digital information.

Cybersecurity threats can target various aspects of your online presence, including financial accounts, personal data, and sensitive information. The consequences of falling victim to cyber-attacks can be distressing, leading to identity theft, financial loss, and emotional turmoil.

To empower you and your loved ones against these risks, we have compiled comprehensive resources and strategies to fortify your digital defenses. Through practical guidance and actionable tips, we aim to equip you with the knowledge and tools to navigate the digital realm safely.

Whether it's using strong, unique passwords for each account, staying vigilant against phishing attempts, or employing multi-factor authentication, taking proactive steps can significantly reduce your vulnerability to cyber threats.

Include Digital Assets in Estate Planning

The Legality of Digital Assets

The Federal level of the United States does not currently have specific laws pertaining to digital fiduciary responsibilities. However, some states have taken measures to address this issue by adopting the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which aims to establish uniformity in digital fiduciary duties.

What is the Revised Uniform Fiduciary Access to Digital Assets Act?

It is designed to guide digital fiduciaries on how to handle the digital assets of a deceased or incapacitated individual. Under this act, fiduciaries are granted access to the digital assets and online accounts of a deceased person if they have been explicitly named and authorized to do so in the individual's estate planning document.

In cases where the estate planning document does not explicitly grant access to digital assets, but the fiduciary deems it necessary for settling the estate, they would require a court order to gain access or must adhere to the terms of service of the digital assets involved.

It is important to note that while RUFADAA provides a framework for handling digital assets, its adoption varies by state.

What Does the Revised Uniform Fiduciary Access to Digital Assets Act Say?

The revised Uniform Fiduciary Access to Digital Assets Act provides three tiers for accessing digital assets.

Tier 1: If the digital service provider gives you a tool to give another user access in case of death, then that user designation guides what happens to the account. A good example of this is Google, allowing you to designate a family member as an inactive account manager. Another example is Facebook, allowing you to designate someone to take over your account after you die.

Tier 2: If there are no tools in the owner's directions in a will or legal document, a court will determine the handling of the account or asset.

Tier 3: If there is no tool provided by the service provider or directions left in a will, the terms-of-service agreement will dictate how the accounts can be accessed and by whom. Terms of service typically restrict use to the owner only, so you'll definitely want to see if your accounts have a designation tool to designate someone to take over the account or write in your will.

Which Online Digital Assets Can You Leave To Your Inheritors?

Determining which online digital assets can be passed on to your inheritors is a crucial aspect of modern estate planning. Some digital assets, such as your personal digital photos and videos, you own outright, making it easier to include them as gifts in your estate plan through your Will or Living Trust.

However, certain digital assets, such as social media accounts and other online accounts, pose unique challenges when it comes to passing them on to loved ones.

Digital assets that hold monetary or sentimental value and are transferable can be included in your Will or Living Trust for distribution. These transferable assets encompass anything you own outright and can be transferred to your designated beneficiaries. These may include not only financial assets but also items of sentimental value, such as digital memorabilia or creative works.

Yet, for digital assets tied to specific platforms or services with terms of use agreements, the situation becomes more complex. In such cases, the options for passing on these assets will largely depend on the policies set forth by the service providers and the legal regulations.

Examples of Digital Assets You Can Leave to Your Beneficiaries

  • Purchased digital music; 
  • Digital photos or videos; 
  • Funds in a PayPal or Venmo account; 
  • Cryptocurrency; 
  • Funds owed to you by an online store like Etsy or Amazon; and 
  • Your frequent flyer miles.

Digital Assets That Don’t Transfer

Certain digital assets cannot pass through your Will or Trust as you lack the right to transfer them. Examples include email and social media accounts, where you hold a license but lack ownership, and their terms of service prohibit transfer.

Examples of Digital Assets That Cannot Pass to Your Will

  • Email; 
  • Social media; 
  • Subscriptions like Spotify; 
  • Apps on your cellphone; and
  • Nontransferable domains that you may have licensed.

Even though you cannot transfer your accounts to someone else, you can leave instructions with your Executor or your loved one about what you want them to do with the account. For example, you can ask them to make one last post on your Facebook account and then close it.

Jackie Bedard
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Attorney, Author, and Founder of Carolina Family Estate Planning
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