Digital assets: Modern, practical estate planning considerations.

• Author: Bazikyan, Barmine
• Position: Estateplanning

it seems that filing cabinets, pencils, erasers and other office supplies of a lew years ago arc either obsolete or will be soon. Much of the estate planning of yesteryear depended on paper files kepi in safe places and instructions as lo where lo locate other documents in Letters of Instruction or other informal (and legally nonbinding) documents. Today much of this information is kept in computers, stored on the internet, and passwords are necessary of access much of this information.

So, even chough you've helped your clients plan their funeral arrangements and who inherits their assets, have your clients thought about what happens to their digital and other unique assets if they are incapacitated or die?

What Are Digital Assets?

Digital assets include things like social media accounts, email accounts, photo books, PayPal accounts, websites and investment accounts. But digital assets also include client files, images, documents, audio, video and similar digital files stored on our electronic devices, be they a mobile phone, laptop, tablet or computes.

And these digital assets have sentimental, historical and financial value.

Thanks to advances in technology, what once was a love letter is now a love email. A family photo album is now on Photobucket. Historically tangible items that were passed from generation to generation are now digitally stored. But, are they still being passed down from generation to generation? Well, without proper planning and organization, it will be extremely difficult for your clients' loved ones lo access these materials.

The estimated average Value of a person's digital assets--such as photo libraries, personal communication and entertainment files--is about $55,000, according to McAfee www.mcafee.com/us/about/news/201l/q3/20110927-01.aspx). This value is based on sentimental attachments and financial investments.

The Following are challenges encountered

when attempting lo include digital assets in an estate plan.

No Planning or Information Left for Loved Ones: Most people do not plan their estates with their digital assets in mind. In fact, digital assets are often ignored until the person becomes incapacitated or dies.

Service Agreements: There is a lack of uniformity as each online service provider has a different set of terms of use. Most likely, family members will not be able lo access their loved one's accounts unless they have been given a list of accounts with the passwords. But even then, most online...