Today, most of us use computers, phones, and tablets to send messages, check in with friends, carry out important financial transactions, watch TV and listen to music, and even to conduct business. Case in point? Odds are very good that you’re reading this post on a smartphone, tablet, or computer screen right now!
The more we all use technology in our everyday lives, the more digital assets we create. Have you ever thought about what might happen to your digital assets when you’re no longer around to manage them? What do you want to happen to your social media and email accounts? Who do you want having the log-in information for your online financial accounts? How will you ensure that your loved ones are able to download precious family photos and videos?
Just as it’s important to have a plan for your tangible property, real estate, and financial accounts, it is essential to consider what will happen to this ever-growing list of digital assets should you become incapacitated or pass way.
For this reason, it is crucial that you discuss a plan for your digital and hybrid assets with your estate planning attorney. A knowledgeable and savvy lawyer can assist you in identifying your most prominent digital assets, while also taking care to ensure that you maintain control over these important accounts and profiles after you’re gone — such as determining how these assets will be managed, and who will be able to access them.
Let’s dig into a few major FAQs about estate planning for digital assets:
“What Digital Assets Should Be Considered for Estate Planning Purposes?”
Today, nearly every facet of our day-to-day lives can be performed and managed online. As a result, a digital asset could refer to any number of things — ranging from media files to social networking accounts. You may also have some important estate planning assets that could be considered “hybrid” assets, such as an investment account that you generally access and manage online.
Curious what might fall into this broad and ever-expanding category? Here are a few of the common digital assets that you may already own:
- Social media accounts
- Email accounts
- “Paperless” online banking and investment accounts
- Online subscription accounts
- Website domains
- Cryptocurrencies (such as Bitcoin)
- Digital photos, vidoes, and other files stored in the cloud or on Dropbox
- Income-generating content published on the web (such as blog posts, written articles, or videos)
- Digital copyrights and trademarks
If you do not make a plan for these assets, they could become incredibly difficult for your loved ones to access when you are gone. Issues like lost passwords, data encryption, and byzantine platform terms of service agreements can make accessing, closing, or transferring these common assets a nightmare.
“Does Michigan Have Any Laws Governing Access to a Decedent’s Digital Assets?”
Michigan is among the sizable group of states that has enacted a version of the Revised Uniform Fiduciary Digital Assets Act, which governs access to an individual’s digital assets when the account owner dies or becomes unable to manage them.
Enacted in 2016, Michigan’s Fiduciary Access to Digital Assets Act defines a digital asset as “an electronic record in which a user has a right or interest.” The person or company that “carries, maintains, processes, receives, or stores a digital asset of a user” is known as a digital custodian. This law provides for access to a decedent or protected individual’s digital assets by a fiduciary, such as a personal representative, trustee, conservator, or agent under power of attorney.
Broadly speaking, the Fiduciary Access to Digital Assets Act helps extend the power of a fiduciary to encompass the management of digital assets. While the act allows fiduciaries to manage digital property such as computer files, web domains, and cryptocurrencies, it largely restricts a fiduciary’s access to electronic communications unless the original user gives their fiduciary access through a will, trust, power of attorney, or other written mechanism. The act also specifies what information a fiduciary may need to present to a digital custodian in order to gain access to digital assets, as well the requirements and procedures for disclosure by a digital custodian.
If you are interested in how this act may affect you as a testator, personal representative, or trustee, do not hesitate to contact a shrewd and savvy estate planning attorney in your area. An estate planning lawyer can help you understand everything that goes into creating a functional estate plan that includes your digital assets.
If you are acting on behalf of an estate, an estates and probate attorney can provide informed professional advice to guide you through the legal process, explain your legal obligations as a fiduciary, and help you discharge your duties in an efficient and expedient manner to avoid personal liability.
“How Can I Make a Plan for My Digital Assets?”
So, what goes into addressing your digital assets within your comprehensive estate plan? Here are a few important steps to keep in mind as you move forward:
- Inventory. One of the most important steps you can take is to thoughtfully and comprehensively list your digital assets. Create a list of online accounts and profiles that your loved ones need to know, as well as information for how to access them. Consider backing up cloud-based data on a physical hard drive, or using an online password manager to keep your records organized. Make sure your inventory is safely stored with your attorney or in a secure place — but take care to ensure that your fiduciaries will be able to access it when the time comes. Learn more about safeguarding your estate plan here.
- Plan. Once you have gotten a handle on your digital assets, talk with your attorney about who you want to be able to have access, and what steps you want them to be able to take to manage, transfer, or close the accounts. For instance, you may want to have your social profiles deleted, or empower your fiduciary to change the passwords for your business accounts. Look into the terms of service and rules for the various online platforms you use, and consider looking into online tools that can streamline communication between your fiduciary and any digital custodians.
- Execute. Work closely with your attorney to draw up will, trust, and power of attorney documents that thoughtfully address your estate’s digital needs. For instance, you may specify whether or not you want to grant your personal representative full or partial access to a specific account. An attorney can help assure that your language is clear, precise, actionable, and effective.
Have Any More Questions About Michigan Estate Planning and Probate? We Are Here For You
There is no reason to put off taking care of those you love and that which you have worked hard for.
Looking for guidance on the many moving pieces that go into successful estate and incapacity planning, including wills, trusts, powers of attorney, guardianship, and conservatorship? Your Michigan probate attorney Dean E. Patrick is here to help.
Mr. Patrick is a licensed Michigan lawyer specializing in estates and probate law. He has helped hundreds with their estate planning needs, giving him the necessary knowledge to provide unparalleled legal advice and assistance that can make your life a little easier.
If you have questions or are curious about how to move forward, contact our offices at (833) 469-4897 or reach out online to set up your initial consultation.
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