What happens to your Facebook account when you die? What about any money you left in your iTunes account? Or the pictures and other files you stored in Dropbox?
Digital assets consist of personal passwords, e-mail messages, Facebook status updates, blog posts, tweets, photos, iTunes music library, YouTube videos, Dropbox files and other digital data. These assets may not only have significant personal value but financial value as well. For example, the domain name HotelsGuide.com recently sold for $60,000, according to domain-name marketplace Sedo. "We shouldn't dismiss our digital assets as insignificant or unimportant," says Evan Carroll, co-author of Your Digital Afterlife. "The things that may seem ephemeral to us are very valuable to heirs once we're gone."
It wasn’t until 2017 that the California legislator signed into law AB-691, the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which added sections 870-884 to the California Probate Code. In simple terms the California Probate Code states that there are two ways to give or limit access to your digital assets. Giving someone access does not necessarily mean full access as you can pick and choose which assets are accessible.
The first method is via an agreement separate and distinct from the terms-of-service agreement between the online service provider and the user, to provide directions for disclosure or nondisclosure of digital assets to a third person. One example of such an online agreement is Facebook’s “legacy contact” system. This system lets you name a legacy contact who can manage your account after it’s memorialized. Your legacy contact will be given authority to download a copy of what you shared on Facebook. The second method is to authorize or “prohibit” disclosure in a will, trust, power of attorney, or other record. However, using this approach only lets your authorized fiduciary access your online assets.
Either of these methods will “override” any directions that you have left in a “terms-of-service” agreement. For example, assume when you first sign up with an online service provider you authorized for all your online data to be deleted upon your death, not knowing that someday your digital assets would be extremely valuable. Now many years and even decades later, that data is quite valuable, and the last thing you want is for that data to be deleted. This means that failure either to sign a legacy agreement with the particular service provider or failure to grant access to your fiduciary that your assets will be dealt with as specified in your initial terms-of-service agreement, which in this hypothetical would be to delete the digital assets. All that value gone in 60-seconds.
So what to do….. First it is advisable that you take inventory of all your online accounts, including e-mail, social networks, blogging sites, photo-sharing sites, frequent-flier accounts, shopping sites such as Amazon.com, credit card accounts, and online bill-payment accounts, such as those established with utilities. For each account, list log-in and password information as well as answers to "secret" questions. When you've completed your inventory, write down where you've stored the information and the master password needed to access it. Put that information in your safe deposit box or with your estate planning documents.
The security of such a list is a critical question. One solution is to use a password-management system such as LastPass.com or 1Password.com. These services will encrypt your log-in and password information and keep it stored on your own computer. You'll have a master password to unlock the data, so it's easy to retrieve and update password information. Another option is to save the list in a password-protected document on your computer. Don't put any password information in your will, which becomes a public document after your death.
When you are preparing for your first estate-planning consultation with an attorney (or preparing for a follow-up consultation, for that matter), you should catalogue your digital assets and think about how you want them handled when you die. That will allow your attorney to include appropriate instructions for those assets in your estate-planning documents.
At Moravec, Varga & Mooney we provide sophisticated cutting edge estate planning. If you would like to schedule a free consultation to see how we can help you, please give us a call at 626-460-1763 or send us an email.