Estate plans should account for the disbursal of all assets, lest they become marooned in probate purgatory. People are forgetting that they have digital assets that need to be accounted for.
Digital assets like cryptocurrency, social media accounts, e-commerce and online accounts need to be cared for just as much as conventional ones, so that family members are able to account for and access them as property, wealth and assets are transferred from one generation to the next.
If these assets are not properly disbursed, estate administration can be delayed or even negatively impacted in the long run, and the rightful heirs might never be able to claim valuable digital property. But the process is more complicated than with conventional assets for the very reason that digital assets are often purposely hidden or encoded in anonymity.
They also can be found in any one of a number of places: saved to a flash drive, encrypted in a file storage program, or in an account but under a pseudonym. But just knowing where they’re located doesn’t necessarily help access them if such information isn’t provided.
Decedents run into headaches prompted by the security concerns of their dearly departed, who may have created complicated passwords and security questions to which the heirs might not know the answers. Because terms of service can bar access even to those who know the aforementioned answers, bills sometimes unknowingly go unpaid, valuable assets unclaimed and estate administration delayed.
Digital property that saved in the online “cloud” on a third party’s digital device can be even more complicated because such assets are subject to the terms and conditions of that service provider. For example, Yahoo! has terms of service that states its accounts are non-transferable and that rights to a user’s ID or contents will be terminated upon death.
Another negative impact of digital assets being neglected in an estate plan is identity theft. Because online service providers are unaware of the individual’s death, hackers and identity thieves are able to access vulnerable and sensitive information—like credit card numbers or even Social Security numbers—for their use. Until a bill goes unpaid, or accounts become due, the service provider does not realize the person is dead—and that any recent activity on the account has been illegitimate.
People of all ages, whether or not they are currently creating an estate plan, need to plan and keep track of their digital assets. Whether they’re setting up a new type of express pay account, or joining a new social media platform, it’s wise to carefully consider who should have access to that information—and who might need it in the future. Consult with experienced Chicago Business Lawyers for your family’s protection.