Digital estate planning relies on technology, involving the assets you own, the tools you use to manage them, and your interactions with various apps and platforms. However, keeping up with fast-paced change in this arena often feels daunting, particularly when building and maintaining a future-proof digital estate plan. That’s why we’ve created this guide.
Read on to find out why digital estates are important, how technology has impacted digital estate planning, what you look for in a digital storage solution, and what changes you can expect on the horizon in the future.
Key Takeaways
Your digital estate is the sum of all your digital assets, which can hold a huge amount of monetary and sentimental value for your loved ones.
Technological tools like AI have streamlined digital estate management by making it fast and easy to categorize, store, and manage your digital estate.
Experts anticipate the continued evolution of AI and quantum computing to further enhance digital security and simplify digital estate planning.
Why Are Digital Estates Important?
In this day and age, a huge proportion of our lives are online.
As a result, most of us now own a dizzying array of “digital assets,” which you can generally classify as anything created or stored online and holds some type of value.
In fact, the digital asset market now sits at a whopping $2.5 trillion. It’s worth noting this number only considers the monetary value of digital assets. Many other assets in your digital inventory might hold sentimental value that simply can’t be quantified.
It goes without saying that quite a lot of assets fall under that category.
Saddat Abid, senior property buyer and CEO at Property Saviour, explains: “This includes social media accounts, like Facebook, through to cryptocurrencies, like Bitcoin, and digital contracts.”
All of your digital assets combine to form your wider digital estate, which can then be used to maintain or distribute those valuable assets to your loved ones when you die.
This enables you to create a digital legacy and generational wealth you can pass down to future generations, helping you secure your family’s future and gain some control over how you’re remembered online.
That’s why organizing and maintaining your digital estate in life is critical.
Edward Hee of Dollar Bureau says there’s an additional dimension around digital estate planning for business owners. He explains:
“As businesses increasingly operate online, ensuring continuity in the digital realm is essential. A comprehensive digital estate plan helps protect sensitive business data, secures intellectual property, and ensures that online business operations can continue uninterrupted in the event of the owner's incapacity or death.
“This planning is particularly vital for small to medium enterprises where the sudden loss of a key person without clear digital directives could disrupt operations or even jeopardize the business’s longevity.”
Fortunately, a wide range of dynamic tools and emerging technologies are making it easier than ever for business owners and ordinary families to set up and maintain comprehensive digital estate plans.
Impact of Emerging Technologies on Digital Estates
Digital estate planning requires the deployment of digital solutions.
However, over the last few years, a fresh crop of emerging technologies has totally disrupted the digital estate market, redefining the way individuals organize, protect, and maintain their digital assets.
Hee explains: “Technologies such as blockchain and AI have revolutionized digital estate planning by enhancing security and automating processes. Blockchain, for instance, provides a secure and immutable ledger for documenting digital asset ownership, which can simplify asset transfer after death, reducing the risk of disputes.”
In addition to blockchain-powered solutions, the “Internet of Things” (IoT) has enabled individuals to connect multiple assets or devices and manage them remotely using one dashboard, which makes it easier to transfer the ownership and access of multiple digital assets or devices after death.
Finally, there’s artificial intelligence. AI has been a huge talking point across multiple industries in 2024, and digital estate planning is no different. AI-powered tools have vastly improved individuals' ability to analyze, store, and manage digital assets.
Take Trustworthy's Family Operating System®, for example.
Trustworthy’s Autopilot feature uses AI to automatically scan your digital assets, providing document summaries, suggesting file names, or categorizing and tagging each asset you upload into your secure digital vault.
That AI application simplifies onboarding and makes your digital estate more searchable and easier to maintain.
Challenges in Digital Estate Planning
Although technology has made it easier than ever to maintain and update our digital estates, individuals and estate planners still face many challenges in this arena.
Believe it or not, the speed with which technology progresses is one of those issues.
Dollar Bureau's Hee explains: “One of the fundamental challenges in digital estate planning stems from the rapid evolution of technology, which often advances faster than the legal frameworks designed to govern it. This mismatch can lead to significant legal ambiguities when it comes to the inheritance and management of digital assets.
“For instance, the lack of comprehensive legislation in many jurisdictions means that the legal status of digital assets like cryptocurrencies, digital art, or even social media accounts remains uncertain in the context of estate planning.”
According to Ron Wysocarski, broker and CEO at Wyse Home Team Realty, this is a particularly thorny problem when it comes to housing. He says:
“As blockchain is still a growing field, the threat of data theft poses a huge risk to digital estate planning. A homeowner can lose their house if the will is only stored in the digital estate.
"Also, often, legal systems want the actual papers for title transactions and generational house transfers, making it impossible to work with digital copies only.”
However, crypto assets aren’t the only area where legislators and industry bodies struggle to create a more uniform approach to digital estate planning.
Like it or not, a large proportion of your digital estate probably revolves around a commercial business that’s holding on to your personal data or assets.
For example, after you post your personal content onto a social media platform, it can be difficult for your digital executor to access and remove it after death because they have to go through the social network to action the instructions left in your estate.
Hee says: “Privacy laws, which are designed to protect personal information, can inadvertently obstruct authorized access to digital assets after someone's death. Complicating matters further, each digital platform has its own service agreement, which users must adhere to.
"These agreements often do not make provisions for the transferability of digital accounts or assets upon death, creating a legal gray area that can prevent executors and heirs from accessing vital digital assets, thereby disrupting the smooth execution of digital estate plans.”
Protecting Your Digital Legacy
By creating a digital inventory and leaving detailed instructions on how you’d like the assets to be distributed or utilized after death, you can pass on generational wealth and build a digital legacy your loved ones will be proud of.
However, to start putting together your digital legacy, you must consider your digital assets and what you’re doing to keep them secure and well-maintained. That journey starts with selecting a powerful digital storage solution you can rely on.
“Security should be the first consideration one ought to bear in mind while choosing digital storage. In secure services, look for those possessing strong encryption algorithms and good backup options so that data won't go missing,” says Abid.
“Other important factors are how user-friendly it is, whether it is attuned to other platforms and applications used.”
Once you’ve found a digital storage solution that works for you, it’s important to build a detailed digital inventory outlining your online assets.
It must include the name and location of each asset and the login credentials required to access each asset. Likewise, it’s worth including information about when each asset was most recently updated and what was changed.
This will support you in knowing which assets are up-to-date and which ones to review.
What Is the Best Digital Storage Solution Available?
Not all digital storage solutions are created equal. That’s why it’s worth partnering with Trustworthy.
Trustworthy is a dynamic digital vault that uses a range of advanced security features to ensure your digital assets are always under lock and key. This includes 256-bit AES encryption keys, facial recognition, and fingerprint authentication to ensure nobody can access your assets without your consent.
Meanwhile, Trustworthy’s Autopilot feature uses AI to categorize and organize your assets. This enables you to search your documents by category or keyword, saving you loads of time sifting through your digital assets to ensure everything is up-to-date.
Additionally, Trustworthy’s collaborative features make it simple to share your digital estate plan (or any other relevant assets) with loved ones, your digital executor, or any other relevant parties.
You only need to select who can access a particular document and the privileges they require to review and update your assets, while everything else is kept safely out of reach.
Ready to learn more? Check out Trustworthy’s range of features to discover why it’s the ultimate digital estate planning solution.
The Future of Digital Estate Planning
As digital estate planning continues to increase in prominence, the technology used to support it will inevitably evolve, too.
While it’s difficult to predict where and how digital estate planning will level up, Abid reckons quantum computing will play a central role. He explains:
“I see, over the coming few years, that developments made in quantum computing are not only going to radicalize digital security by highly unprecedented levels of encryption but also marriage between blockchain technology and AI for better management and automation of digital assets.
"We're probably going to witness more comprehensive legal frameworks across the world dealing with this particular subset area of digital estate planning and offering clearer guidance to individuals and businesses at large.”
Frequently Asked Questions
How do I create an inventory of my digital assets for estate planning purposes?
To create a digital inventory, build an organized list of all your digital assets. Try to categorize your assets and include key information about each asset, its location, and access credentials.
How can I ensure my executor or trustee will have access to my important digital assets and accounts?
Your digital estate plan should include a set of access credentials to accompany each digital asset. In addition, make sure to add detailed instructions for each asset so your executor knows what to do when they log in.
What do experts predict about the future of digital estate planning over the next decade?
Moving forward, experts expect quantum computing to strengthen digital security, while blockchain and AI will streamline and simplify document management, analysis, and maintenance.
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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.
