Today, we store many essential aspects of our lives in digital formats. Many important things are online. This includes bank accounts, crypto wallets, social media accounts, personal files, and family photos. But, Californians often overlook these assets in their estate plans. This oversight can leave loved ones unable to access critical accounts.
Understanding Digital Assets
Digital assets refer to all accounts and information that exist in electronic storage. Common examples include:
- Online bank and brokerage accounts
- Cryptocurrencies like Bitcoin or Ethereum
- Email accounts and communications
- Social media profiles such as Facebook, Instagram, LinkedIn, and Twitter
- Digital photographs, videos, and cloud-stored documents
- Subscription accounts (streaming services, online tools)
The Importance of Digital Assets in Estate Planning
Your family could struggle to access important digital accounts without explicit instructions. Lack of access can slow down estate administration. It can cause stress and lead to financial loss.
California’s Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) allows executors and trustees to manage digital assets with minimal difficulty. Legal authorization must be explicitly outlined in your estate plan.
Understanding California’s RUFADAA
California’s RUFADAA gives clear rules for how executors and trustees can access digital accounts after a person dies. The law says digital platforms must give fiduciaries access to digital assets if they have proper authorization. To ensure smooth access, your estate planning documents must include a clear grant of these rights.
Essential Steps to Incorporate Digital Assets
- Create a Comprehensive Inventory: Maintain a detailed, updated list of your digital assets. Include usernames, but avoid listing passwords for security reasons.
- Choose a Digital Executor: Pick someone you trust who knows technology well. They should be able to handle your online presence. Identify this person’s role in your legal documents with precision.
- Articulate your preferences for your social media accounts. Should they be memorialized, deactivated, or deleted? Detail how individuals and organizations should handle financial digital assets, such as cryptocurrencies.
- Consult an Attorney: This ensures your estate documents have the right legal language. This step allows your digital executor to manage your digital assets with efficiency and in accordance with the law.
- Secure Sensitive Information: Use safe, encrypted ways to store usernames, passwords, and other key access info. Provide clear, detailed instructions about accessing these details after your passing.
- Regularly Review: Digital assets undergo frequent changes. Check your inventory often. Update your instructions for any new accounts or changes online.
The Value of Professional Guidance
Digital estate planning can be complex. A knowledgeable estate planning attorney manages your digital assets with precision. This professional guidance helps protect your family’s interests and avoids unnecessary complications.
Adding digital assets to your estate plan brings peace of mind. It also gives clarity to your loved ones.
