Estate Planning and the Digital Age

By: Yasmin Ranade

March 9, 2020

In the Digital Age, will and estate planning affects every tech user – Gen Z, Millennial, Gen X as well as Baby Boomers. I asked Sharon Hartung, author of Your Digital Undertaker: Exploring Death in the Digital Age in Canada, to comment , as she’s currently a tech management consultant who helps estate advisors manage digital assets and footprints upon death.

“My journey started when my mom died without a will,” shared Hartung. “In dealing with her estate, I realized how the big the job was for the executor, but I couldn’t find a basic how-to manual and everything that existed was for the pre-digital world. So, I dealt with it the same way I dealt with any military or IBM project. I put on my project management hat, created charts, diagrams and checklists. I then compiled the information in a simple guide to getting your affairs in order––with a side of digital. It’s simply the list of questions I wish I could have asked my mom.”

Hartung explained, “We all now own a new set of assets, called digital assets that include our email, loyalty points, online access, social media accounts, gaming points, travel rewards, and even our crypto assets.”

What is Digital Estate Planning? 

“Digital estate planning is just another aspect of traditional estate planning,” began Hartung. “Our digital estate includes memories, money and records, but instead of being paper based, they’re stored in digital formats.”

Hartung highlighted digital assets in three ways:

  • Memories include digitized photos and social media.
  • Money includes electronic access to financial institutions, loyalty points, crypto assets, and ad and click revenue from online channels.
  • Records provide the digital trail our executor needs to access during estate administration.

“Prior to the Internet,’ added Hartung, “the executor would have accessed the deceased’s home office and found the necessary paper trail. Although, there may have been hunting and searching through files and stacks of paper, today the executor is likely faced with a locked screen.”

“Although technology is the new player at the estate planning table, the same principles apply to our physical and digital assets. We still must create an inventory––but now that list includes our digital assets,” said Hartung. “We must legally document our wishes by engaging legal, tax, and estate advice, and discussing our intentions with our executor. The fundamentals of planning, documenting and communicating apply equally for both digital and physical assets.”

Inventory Your Digital Assets

“Our entire digital estate should be considered in will and estate planning,” stated Hartung. Furthermore, she advised, “Give your executor the powers to deal with your digital estate. Express your wishes and leave instructions.”

Other tips Hartung shared were:

  • Spend extra time planning for your top three digital assets. Consider what would devastate you if a memory couldn’t be passed along to a loved one after death.
  • Review your plans with your estate advisor. A legal advisor in your jurisdiction can provide estate planning advice for digital assets.
  • Review the terms of service for online accounts for restrictions and constraints.
  • Provide instructions to your executor for unique digital accounts, such as unregulated crypto currencies where there is no central authority for password resets.
  • Review pre-planning options provided by service providers, such as Facebook’s Legacy Contact and Google’s Inactive Manager. Consider naming your executor as contact in these tools or if you choose someone else, document your plans to avoid confusion.
  • Evaluate converting accounts to business status to leverage additional tools and features.

Advice for Canadians

“Our digital lives are intertwined with our physical lives and jurisdiction specific estate law governs both,” said Hartung. “Will and estate planning is unique to each individual, but four common themes apply:

  1. Create an estate inventory that includes your digital assets. List your online accounts, user name, and wishes for each including instructions for the executor.
  2. Seek professional estate advice. What the executor is allowed to do after death is covered by provincial and territorial jurisdictional specific estate laws. The laws covering digital assets are new and evolving, and as the tech giants reside in the US, there are likely legal requirements and terms of service constraints that need to be understood.
  3. Get tax advice for your digital assets of significant value to avoid your estate facing more taxes.
  4. Review your will and your wishes with your executor. Provide instructions needed to execute your intentions in an estate binder, folder, or envelope. If you choose to pass this information along digitally, consider a back-up plan.”

Hartung summed up, “The entire tech industry is ripe for dealing with incapacity and estate planning, and I hope [my] book serves as a reference for companies that provide online services, apps and digital assets.

 

 


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