Don’t Forget Your Digital Assets!

When people think about estate planning, they often focus on homes, savings, and heirlooms. But in today’s digital age, a comprehensive estate plan must also account for digital assets. If you live in Bloomington, Peoria, or anywhere in Central Illinois, chances are you have a significant online presence – social media profiles, online bank accounts, photos stored in the cloud, maybe even cryptocurrency or a PayPal balance. What happens to those assets if something happens to you? Without proper planning, your loved ones might be locked out of your digital life, or valuable online property could be lost. Estate planning isn’t just for physical assets anymore. In this post, we’ll explore why including digital assets in your estate planning in Bloomington, IL is so important and how to do it right.

What Are Digital Assets in Estate Planning?

Digital assets encompass a broad range of items that exist electronically. Some common examples include:

• Online financial accounts: Banking, stock trading (like E*TRADE accounts), or payment services such as PayPal and Venmo.

• Cryptocurrency and NFTs: Bitcoin, Ethereum, or other digital currencies and digital collectibles stored in wallets.

• Social media and email: Facebook, Instagram, Twitter, personal blogs, email accounts (Gmail, Outlook, etc.).

• Online subscriptions and media: Photo or file storage (like Google Photos or Dropbox), music and video libraries (iTunes, Spotify, Netflix profiles), and even Amazon accounts.

• Domain names and websites: If you own domain names or run a revenue-generating YouTube channel or Etsy shop, these are digital assets too.

These assets can have financial value (cryptocurrency or PayPal balances), sentimental value (family photos on a cloud drive), or contain important information. In the eyes of the law, many digital assets are considered property, but accessing them isn’t as straightforward as walking into a bank with a death certificate. Providers have privacy policies, and without proper authorization, your family might not be able to retrieve or manage your accounts.

Why Digital Assets Matter in Your Estate Plan

Imagine a scenario: you’ve been careful to create a will that divides your house, car, and bank money among your children. But you never considered your online investment account or your collection of purchased music and e-books. After your passing, your family might not even know these digital assets exist, let alone have the login credentials to access them. Important photos or personal messages could be lost forever. On the financial side, any cryptocurrency or online-only bank accounts might effectively vanish if no one can claim them. Beyond loss, there’s also risk: inactive or unmonitored accounts can be targets for hackers or identity thieves. An unaccessed Facebook account could be hacked and used maliciously, for example. Including digital assets in your estate plan ensures your loved ones can access what’s important, preserve your digital legacy, and securely wind down or transfer accounts to the rightful beneficiaries. It also gives you control: you might have specific wishes, such as having your social media profiles memorialized or deleted, or passing on your business’s website to a particular person. Without written instructions, those wishes might not be carried out.

Illinois Law and Access to Digital Assets

Many states, including Illinois, have laws in place to help manage digital assets in an estate. Illinois adopted a version of the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA). This law sets out rules for how an executor (the person handling your estate) or an agent under a power of attorney can access your digital information. The important takeaway is that you can explicitly grant your executor the authority to access your digital assets in your estate planning documents. For example, in your will or trust, you can include language that gives your executor or trustee permission to access and manage your online accounts and files. If you don’t include this, the companies (Google, Facebook, banks, etc.) might refuse to hand over data due to privacy laws or their service agreements. It’s also worth noting that some online services provide their own tools: Google has an “Inactive Account Manager” where you can set up who gets access to your Google account if it’s inactive, and Facebook allows you to designate a legacy contact to manage your profile after death. These tools are useful, but they don’t cover everything, so backing them up with legal documents is wise. An estate planning attorney in Illinois can ensure your documents use the right legal language to comply with state law and each company’s requirements.

How to Include Digital Assets in Your Estate Plan

Planning for digital assets might sound complicated, but it boils down to a few key steps:

1. Inventory Your Digital Assets: Make a list of all your digital accounts and assets. Include account numbers or URLs, and a general idea of what’s in them (for example, “Chase online savings account” or “Coinbase cryptocurrency wallet”). Don’t write down passwords in your will (since that becomes public in probate), but do note where someone can find your login info.

2. Use a Password Manager or Secure Record: Consider using a reputable password manager that can store all your login credentials in one secure digital vault. Many password managers allow an emergency contact to access in case of death. Alternatively, some people keep a sealed list of passwords in a safe or with their attorney. However you do it, ensure your executor or a trusted person can access this master list.

3. Add Digital Asset Clauses to Your Documents: Work with your estate planning attorney to insert provisions in your will, trust, and powers of attorney that give your chosen representatives the power to access and manage digital assets. Specifically name a “digital fiduciary” if you want, which could be the same person as your executor or another tech-savvy individual you trust to handle online matters.

4. Specify Your Wishes: Clarify what you want done with certain accounts. For instance, you might instruct that your social media be memorialized or deleted. You might want your online business to continue running (so you’d need to provide instructions and rights to transfer it), or you might direct that some files be given to specific family members (like a folder of family photos).

5. Keep Your Plan Updated: Just as with the rest of your estate plan, revisit your digital assets list regularly. We all open new accounts or change subscriptions over time. An outdated list won’t be very helpful, so review it annually or whenever you have a significant change (like buying new cryptocurrency or starting an online venture).

Following these steps will greatly increase the chances that your digital assets are handled according to your wishes and don’t get lost in the digital void.

The Benefits of Professional Guidance

While it’s possible to DIY parts of digital planning (like making your own list of accounts), integrating it smoothly into your overall estate plan is best done with professional help. An experienced estate planning attorney in Bloomington or Peoria will know the right questions to ask and the right language to use in your documents. They can ensure that your estate planning in Bloomington, IL covers all bases – from your house to your Facebook account. They’ll also be up-to-date on any changes in technology or law, like new regulations on cryptocurrency or updates to Illinois statutes. By working with a professional, you’ll create a plan that is legally sound and practically useful to your heirs. After all, there’s little point in planning if your family can’t actually carry out your wishes. A well-crafted estate plan will give you peace of mind that everything – even your digital life – is taken care of.

Conclusion:

In the modern world, almost everyone has digital assets that deserve attention in their estate plan. Don’t let your online accounts and files become inaccessible or forgotten. By taking inventory of your digital presence and including clear instructions in your estate planning documents, you protect both the financial and sentimental value that lives on your computer and the internet. Residents of Bloomington, Peoria, and all of Central Illinois should approach estate planning with a 21st-century mindset: tangible and digital assets go hand in hand. If you’re unsure where to start or want to update your existing plan to include digital assets, contact Kepple Law Group. Our estate planning attorneys are well-versed in the latest best practices, including digital asset protection. We can help ensure that every aspect of your legacy, online and offline, is secured for your loved ones.