The digital age has fundamentally changed how we live, work, and even die. While traditional estate planning focuses on physical assets like property and investments, a growing concern is the fate of our ever-expanding digital footprint. In today’s digital world, your online presence and digital assets can be just as integral to your estate plan as your physical property.
This blog delves into the complexities of estate planning for digital assets and provides considerations and practical steps to help you ensure that your physical and digital assets are managed properly during your lifetime and after.
What are Digital Assets?
Digital assets can encompass a wide range of online properties and information, including:
- Financial Accounts: Online bank accounts, investment accounts, cryptocurrency and non-fungible tokens (NFTS) contain significant value.
- Social Media Accounts: Many individuals have at least one or more social media profiles on Facebook, Instagram, Twitter, LinkedIn, Youtube, and TikTok that contain photos, messages, and other activities in online communities.
- Email and Other Communication Accounts: These accounts generally contain years of accumulated emails holding crucial personal and professional communications.
- Digital Documents and Files: Important documents like passports, tax records, photos and videos.
- Creative Works, Domain Names and Intellectual Property: Original content like digital artwork, ebooks, copyrights, trademarks, and patents, and music compositions also hold significant value.
Challenges With Digital Asset Management
Digital assets are typically stored electronically either on a physical device or in a cloud-based software. It is also important to consider the monetary value of each digital asset, in addition to their sentimental value, when deciding how you wish for them to be handed after your passing.
Limitations and Terms of Service
Unlike physical assets, digital assets often exist on third-party platforms with their own terms of service regarding account access and inheritance. Depending on the platform the asset is sorted on, these terms can be complex and may change frequently, making it difficult to predict what will happen to your digital assets upon your death. Some platforms, however, let you specify what will happen to your digital data after your passing. For example, Facebook allows you to appoint a legacy contact who can continue to manage or memorialize your account. As such, it is important to ensure that you know the limitations and options available to each account you hold and use the provided tools to dictate who should handle each account and how.
Privacy Laws and Regulations
Federal and provincial privacy laws can also limit an estate trustee’s access to the digital assets, and may impact the ability of beneficiaries to obtain certain digital assets. Your estate planning lawyer will help you identify potential privacy issues and challenges to ensure your estate plan complies with the applicable legislation.
Strategies for Effective Digital Asset Estate Planning
Working with a skilled estate planning lawyer can help you prepare a comprehensive estate plan, which also covers management of your digital assets. Some factors to consider when contemplating your estate plan include:
- Creating an Inventory for Your Digital Assets: Create a comprehensive list of all your digital assets, including usernames, passwords, and account locations and consider using a secure password management tool for additional security.
- Designate a Digital Executor: It may be possible to appoint a trusted individual who is comfortable navigating the digital world and can manage your online accounts after your death.
- Review Platform Terms, Conditions and Policies: It is important to familiarize yourself with the terms and conditions of service on all platforms and accounts that contain your digital assets. This allows you to plan accordingly and, if permitted by the platform, affords you the opportunity to proactively designate a contact and identify your chosen beneficiaries within the platform itself.
- Communicate Your Wishes in Your Estate Plan: Clearly outline your desires for each digital asset in your will or a separate document, listing the relevant accounts and platforms, log-in details, who you wish to have access to the accounts, and specify what you want to happen to each account (for instance, determine whether you wish for your accounts to be memorialized and preserved for loved ones or deactivated).
Key Takeaways Regarding Digital Assets and Estate Planning in Ontario
With the right estate planning, you can take actionable steps to protect sensitive information and ensure that your digital legacy is managed in accordance with your privacy preferences. The digital world is an intricate part of our lives, and our online presence deserves thoughtful consideration in estate planning. This can ensure that your digital legacy is handled according to your wishes, protecting your loved ones from unnecessary confusion and complications. Failure to account for these digital assets can lead to lost information or may leave your loved ones with difficulties accessing important information you wish to pass on. Further, there is a risk of financial loss if certain digital assets go undetected.
Therefore, consulting with a trusted estate planning lawyer who is familiar with digital assets and can help you navigate the legalities to ensure your digital wishes are effectively integrated into your overall estate plan is crucial.
Contact the Estate Planning Lawyers at Bader Law in Mississauga & Oakville for Advice on Wills and Trusts
At Bader Law, our skilled team of estate planning and administration lawyers regularly work with clients in Mississauga, Oakville, and across Ontario to help them to develop, or amend, their estate plan. We will ensure that your digital assets, along with your physical property, are identified, preserved and incorporated into a well-rounded estate plan, so that you can ensure your loved ones will have access to all of your assets after your passing. To schedule a confidential consultation with one of our estate planning lawyers, contact us online or reach out to us by phone at (289) 652-9092.