Estate Planning for Digital Assets: What Virginians Need to Know
Estate planning is typically connected to physical assets, such as homes, savings, or other physical items. However, today, an increasing portion of a person’s financial life happens online. For example, emails, social media profiles, Bitcoin, and photo libraries are only a few of the many digital assets that people own. In Virginia, if a person fails to plan for their digital assets, there could be problems accessing them once they pass.
What counts as a digital asset?
Digital assets encompass much more than simple online banking and investment accounts. They include email accounts, social media accounts, digital photos and videos, online businesses, subscription sites, reward points, domains, and cryptocurrency accounts. Some may have actual financial value, and other digital assets have personal and sentimental value. Without guidance, families may not know if and how digital assets can be accessed.
Why digital assets are often overlooked
One myth about securing digital assets is that you only need user names and passwords. What if a service provider denies a family member access to the account after they die when the information to access the site is known? There are laws and terms of service that might make it difficult to enter a service without permission as an executor. Storing passwords in a last will and testament might cause some security risks.
Virginia law and digital assets
Virginia has passed a form of the Revised Uniform Fiduciary Access to Digital Assets Act. This act enables individuals to grant fiduciaries, such as executors or trustees, powers of digital asset access when such powers are specifically included within estate plans. If a will is not specifically written to provide powers of digital asset access, there may be delays in accessing their accounts or an outright denial.
How to properly include digital assets in your estate plan
An effective digital asset management plan has to begin with an inventory. That involves listing your accounts and their purpose for your business, as well as their value to that business. Then you have to consider who needs to access the accounts and the level of access you want to give them. Some accounts may need to be shut down, while others need to be retained or transferred to new owners.
The estate planning instruments may include provisions that stipulate control over digital properties. This control can be restricted or extensive, as desired. Passwords that contain confidential information ought to be securely stored and not within the will itself. It will need to be updated from time to time.
Common mistakes to avoid
Not considering online assets at all is one major error you can make. Another is sharing your password without documented agreements. This can cause disputes or even breach guidelines set by service providers. Following outdated guidelines is dangerous, as online platforms and accounts keep on evolving constantly.
Talk to a Virginia Beach, VA, Estate Planning Lawyer Today
The Law Office of Angela N. Manz represents the interests of Virginia Beach residents looking to create or update their estate plan. Call our Virginia Beach estate planning lawyer today to schedule an appointment, and we can begin discussing your next steps right away.