The traditional concept of estate planning typically consists of the bestowing of financial and personal belongings to loved ones or selected organizations at the time of one's death.
In our megabyte modern culture, however, intangible digital assets--such as usernames and passwords--should also be considered when you develop your estate plan.
According to a recent Pew Research study cited in a USA Today article, 51% of American adults are banking online and 32% use their mobile phones to carry out their bank transactions.
Indeed, with nearly nine out of 10 Americans using the Internet, and our increasing reliance on the virtual world to conduct our lives, most of us are amassing a trove of electronic assets. This can include sensitive financial information, as well as sentimental content, such as digital photos and social media accounts. Without proper preparation, such valuable data could be lost. The encryption of this data also causes headaches for family members trying to sort out one's estate following his or her passing.
Estate planning attorney James Lamm advises that you take stock of your digital assets and include them in a living will or trust. You can also revise your estate plan to give your fiduciary access to—and relevant instructions regarding—your important data in the event of your death or incapacitation. Note: Since wills eventually become public, it is recommended that you simply refer to the location of this sensitive information (perhaps in a safety deposit box).
TIAA-CREF can help you create an estate plan that includes all of your assets—including your valuable digital property. This 12-minute webinar outlines some basic steps.
Source: “Estate Planning 101: Don’t Forget Digital Assets,” USA Today, May 2014