Estate Planning for Virtual AssetsSubmitted by Grunden Financial Advisory, Inc on August 20th, 2012
The Wall Street Journal and SmartMoney recently published articles about “virtual assets” which can sometimes be forgotten about in estate plans. Estate planning is the process of organizing, managing, and disposing of assets for someone in the event of their incapacitation or death. Financial assets like checking accounts, investment accounts, real estate, and personal property are usually the typical assets one thinks of when developing an estate plan. However, what about the overlooked “virtual assets”?
Since we live in a digital age, more and more of us now have a digital footprint. If those in charge of your estate plan aren’t given direction, the “nontangible, digital assets people create and store on computers and the Internet” could be forgotten. It can be difficult for an estate to claim virtual assets, assuming they even know where to look. Some traditional virtual assets include user name/passwords for checking/investment accounts/credit cards and e-mail. Billpay is another service which could wreak havoc if the spouse who maintains the family’s finances is no longer around to administer and monitor this program. A situation may arise where automatic payments are sent out of the checking account unknown to others which could cause other payments to be declined or drain the family checking account of cash.
Today, the list of virtual assets has grown to include Facebook, LinkedIn, and Twitter accounts. How do the survivors gain access to these accounts?...and what do they do with them once access is gained? Some opt to keep these social media accounts open as a living memory while others may wish to have them shut down. Another virtual asset are websites. Not just the content of websites, but also the domain names (what you type in to go to a website, like “www.grunden.com”). Some entrepreneurs purchased various domain names in hopes of selling them for a profit sometime down the road or they may have bought them in anticipation of personally using them.
Many experts, according to the articles, recommend stating your wishes within your estate plan (do you want your Facebook account to remain after you are gone?) and storing usernames/passwords in a secure place. Some store usernames/passwords in a password protected file on their home computer (just don’t forget to tell someone the password), on a USB drive in a safe deposit box (make sure appropriate people have access), or on a number of online sites which offer to store your data for a fee.
To read the Wall Street Journal and SmartMoney articles in their entirety, please click below: