The online world evolves rapidly, and with so much of our lives now digitally driven, our digital assets can change just as quickly.
That's why it's crucial to understand how to manage and organize your digital assets as part of a comprehensive digital estate plan. Keep reading to learn what a digital will is, why it's important, and the steps you need to take to create one.
Key Takeaways
A digital will includes an inventory of all your digital assets, access credentials, and clear instructions.
When you create a digital will, it’s important to appoint a digital fiduciary (or executor) to follow your instructions.
Your digital will can be included as part of your traditional will or stored and maintained separately.
What Is a Digital Estate?
Before we dive into how to plan your digital legacy, it’s worth taking a step back to cover what a digital estate is and why it’s so important.
A digital estate is effectively the sum of all your digital assets. It is anything that is created or stored digitally and possesses some sort of value — whether it’s monetary, sentimental, or a combination of the two.
As you might expect, that umbrella covers a dizzying range of assets.
Ben Michael, an attorney at Michael & Associates in Dallas, explains: “Some of the most obvious include those related to digital finance, like online banking and brokerage accounts, crypto, and online payment accounts (Venmo, Zelle, etc.).
“It also includes things like digital accounts, such as emails, social media accounts, library accounts, and more, as well as documents stored digitally like photos.”
Considering just how many components unite to form your overall online presence and digital wealth, organizing and managing digital assets can be exceedingly difficult. That’s where digital estate planning comes to the rescue.
“Digital estate planning is important because most people have so many of their earnings and belongings held digitally these days,” Michael says.
“Failing to do proper digital estate planning can lead to major complications down the line, from not being able to access important online accounts to not knowing a person’s wishes regarding who can access what.”
There are a variety of strategies and online tools you can call upon to manage your digital estate, but the foundation of your online legacy is a digital will.
What Is a Digital Will?
Digital wills are often confused with digital copies of a traditional will, but the difference is pretty straightforward.
A digital copy of your traditional last will and testament is an online version of your regular will. It must follow the relevant rules in your state to ensure it’s legally valid, and a traditional will is accepted by a probate court as binding.
By contrast, a digital will is a comprehensive inventory of all your digital assets — alongside detailed instructions on how you’d like those assets to be passed down or disposed of after your death.
It’s possible to include your digital will alongside your traditional will by including access credentials and instructions for your executor to follow when you’re gone as part of your wider estate management plan.
That being said, your digital will can also sit in isolation with its own digital executor.
Why Is Having a Digital Will Important?
Nowadays, many of us spend a huge part of our lives online. Social media accounts or creative works you share online represent your legacy, and by creating a digital will, you’re deciding how your legacy is portrayed after death.
For example, you might want your social media accounts totally removed to ensure no one impersonates you in the future. Alternatively, you might want those accounts to be maintained in your memory. Creating a digital will with explicit instructions guarantees your wishes are honored.
A digital will is also an important tool to make sure that digital assets with monetary value are passed on to the person, group, or organization you want to benefit from those assets moving forward.
That could mean stipulating how you want the contents of your crypto wallet distributed to loved ones, or who you want to receive any future royalties associated with digital artworks you’ve created.
Without a clear digital will, ownership over assets could become muddled, or the assets could be forgotten altogether.
Steps for Creating a Digital Will
Just like a traditional will, a digital will can be as complicated or simple as you’d like it to be. Regardless of how you’d like to format it, the process of putting one together is relatively straightforward.
Just follow these five steps:
1. Inventory your digital assets
Riley Beam, managing attorney at the Douglas R. Beam law firm in Florida, explains: “First, you need to make a list of all your online accounts and digital assets. This includes things like email, social media, online banking, cryptocurrency, domain names, and digital files.”
It can be difficult to know where to start your digital inventory and ensure it’s both accessible and searchable. That’s where a platform like Trustworthy can offer much-needed support.
Trustworthy is a unique Family Operating System® that enables you to securely upload, create, and store a wide range of digital documents and assets. It then uses smart features to automatically categorize and tag each item so that every component of your digital estate is completely and sensibly organized at all times.
Want to learn more? Check out Trustworthy’s range of features.
2. Create clear instructions
“Next, decide what you want to happen to each account and asset after you pass away,” Beam says. “Whether you want certain people to be able to access them. Should some accounts be deleted? Make a plan.”
There are a couple of different routes you can take.
You might want to create a set of blanket instructions to apply to multiple assets or an entire category of assets. For example, you might include instructions that all of your social media accounts are to be deactivated after your death, which would apply to a handful of different assets.
However, you might also want to include more detailed and specific instructions for each individual asset. Either way, ensure your instructions are clear for each asset in your inventory.
3. Appoint a digital fiduciary
After setting up digital will instructions, you must appoint a digital fiduciary.
What is a digital fiduciary? You might also see people refer to a digital fiduciary as a digital executor, but both terms mean the same thing and have the same responsibility: to oversee your digital estate.
“A digital executor is the person you trust to carry out your wishes. They'll need to be able to access your accounts, so make sure they know your plan,” explains Beam.
Ensure you appoint a trustworthy individual who is capable of handling your personal affairs. Have an open and honest conversation with them to confirm that they understand the role of fiduciary and are willing to carry out your instructions.
4. Securely file and store your digital will
Because your digital will is an inventory of all your valuable online assets, it’s critical that you store it somewhere both ultra-secure as well as somewhere accessible.
This guarantees your digital inventory, access credentials, and instructions are always totally safe but can also be shared with relevant parties like your digital fiduciary, family members, or estate planner.
For example, Trustworthy enables you to control secure access to all your digital assets on a case-by-case basis.
That means you can share your digital will with your digital fiduciary, immediate family members, or attorney while your other documents remain locked down using two-factor authentication and AES 256-bit encryption.
5. Maintain and update your digital will
Your inventory of digital assets will likely change regularly. Likewise, third-party sites may encourage you to change your passwords or introduce new elements of two-factor authentication. When these updates arise, your digital will needs to be amended accordingly.
That’s why David Greiner of David J. Greiner Law Corp. in Victorville, California, says it’s important to regularly audit your assets and any potential changes to your instructions for the future. He advises:
“Do an annual digital audit to make sure your list of accounts is up to date, use a password manager to keep login info secure but accessible, and consider leaving some social media accounts memorialized rather than deleted after death.”
Legal Considerations and Documentation
As we’ve already pointed out, creating a digital will is relatively straightforward. That’s because it doesn’t fall under the same legal remit as a traditional last will and testament, which means you’re free to create, store, and share a digital will however you see fit.
However, Beam points out there are some legal considerations you do have to bear in mind when establishing your digital will. He explains:
“The most important consideration is that your digital will shouldn’t conflict with your regular will. You want to make sure these two wills work together and don't cause any problems for your loved ones later on.
"For example, if your regular will says one person gets your bank account, but your digital will says someone else can access that account, that could cause a big problem for your loved ones trying to sort it all out.”
To guarantee cohesion between both documents, it’s worth sharing both documents with your attorney, accountant, or estate planner so they can review your instructions and offer any necessary clarification or assistance.
There is some legislative support associated with digital assets. This includes the Revised Uniform Fiduciary Access to Digital Assets Act, which is the law that creates a framework to ensure companies grant your digital fiduciary access to your accounts.
Meanwhile, a range of state data protection laws enshrine the right of individuals to request that information about them be removed. Some states even have clauses protecting an individual’s “right to be forgotten,” which means that companies are obliged to act on requests asking for the removal of any references to that individual.
These may be tools that can support your executor or trustees in following the instructions spelled out in your digital will. However, it’s important to check the legislative protections or requirements in your state.
Frequently Asked Questions
How is estate planning for digital assets different from planning for traditional assets?
A digital estate encompasses a range of assets that may present challenges not experienced with traditional assets. These include ownership, access to the asset, and even verification of its existence.
What documents should be included in a digital estate plan?
Generally speaking, your digital estate plan should incorporate a digital will that includes an inventory of your digital will, access credentials, a document appointing your digital fiduciary, and instructions pertaining to each asset.
Can my family legally access my online accounts if they have my usernames and passwords after I pass away?
Laws tend to vary both by state and the type of account. However, there is a protocol executors or trustees of your digital will can deploy using the Revised Uniform Fiduciary Access to Digital Assets Act.
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Trustworthy is an online service providing legal forms and information. We are not a law firm and do not provide legal advice.
