Most estate plans focus on traditional assets such as homes, bank accounts, and investment portfolios. Today, however, a growing portion of a person’s financial life, personal information, and even family memories exists online.
Digital assets can include everything from online banking accounts and cryptocurrency holdings to email accounts, social media profiles, and cloud-based photo libraries. Unlike physical property, these assets are often inaccessible without proper passwords, credentials, or legal authority.
Accounting for digital assets in your estate plan helps ensure that important online accounts and property can be identified, accessed, and managed in accordance with your wishes. Taking the time to address these assets now can help protect both your financial interests and your digital legacy.
What Counts as a Digital Asset?
Digital assets include far more than social media accounts. They encompass a wide range of online property and accounts that may have financial value, preserve important personal memories, or support ongoing business operations.
Examples of common digital assets include the following:
- Online financial accounts: Bank accounts, investment platforms, PayPal, Venmo, Robinhood, and other financial services.
- Cryptocurrency and NFTs: Digital currencies and blockchain-based assets.
- Social media accounts: Profiles on platforms such as Facebook, Instagram, LinkedIn, and X.
- Email accounts: Personal and business email accounts that may contain important records and communications.
- Digital photo and video libraries: Cloud storage accounts, photo archives, and family videos.
- Business digital assets: Domain names, websites, online stores, and other digital business property.
- Digital content: Purchased e-books, music libraries, movies, games, and other digital media.
As more of our financial and personal lives move online, identifying these assets becomes increasingly important in estate planning.
“My top tip for digital assets: make a list of all your digital accounts and make sure your trustee or executor knows how to access them. Many platforms now allow you to set a ‘legacy contact’ or ‘digital heir,’ so take advantage of that when possible. If you hold cryptocurrency, make sure your trustee knows where your wallet keys or seed phrases are stored. Otherwise, those funds could be lost forever.”
Why Digital Assets Are a Unique Planning Challenge
Identifying digital assets is only the first step. Many of the difficulties regarding what happens to online accounts when you die stem from the challenge of ensuring someone can actually access them after your death.
Unlike traditional property, digital assets often cannot be accessed simply because someone knows they exist. Access may depend on passwords, multi-factor authentication, encryption, or platform-specific procedures that can make recovery difficult without proper planning.
Beyond passwords and authentication requirements, many online platforms have their own terms of service governing what happens to an account after death or incapacity. Federal and state privacy laws may also limit access to information without proper legal authorization. As a result, family members, trustees, and executors may encounter obstacles that do not typically arise with traditional assets.
These challenges make digital assets a unique part of the estate planning process and highlight the importance of documenting their existence and how they can be accessed.
The Unique Risks of Cryptocurrency
Cryptocurrency estate planning requires special attention because digital currencies may be permanently inaccessible if critical access information is lost. Unlike many online accounts, there may be no customer service department, password reset process, or account recovery option available.
For a successor trustee or executor to manage cryptocurrency assets, they generally need to know where those assets are held, whether in a hardware wallet, a software wallet, or a cryptocurrency exchange. They must also have access to the private keys, wallet credentials, or seed phrases needed to access the assets.
Because that information is highly sensitive, it generally should not be included directly in a trust document. Instead, many individuals maintain separate instructions that can be securely located and accessed when needed. Taking these precautions can help reduce the risk that valuable cryptocurrency holdings become permanently inaccessible.
How to Include Digital Assets in Your Estate Plan
Digital assets often require information that extends beyond traditional estate planning documents, making it important to devise a clear strategy for managing them. The following steps can ensure digital asset information is organized, protected, and available to the appropriate people when needed:
- Create a digital asset inventory: Maintain a list of important online accounts, digital property, and cryptocurrency holdings, along with their locations.
- Store access information securely: Use a password manager, an encrypted document, or another secure method to store login credentials and access instructions.
- Use a personal property memorandum: This document can help organize information that may need to be updated periodically without revising your entire estate plan.
- Take advantage of legacy contact features: Many platforms allow users to designate a legacy contact or digital heir who can manage certain account functions.
- Inform your trustee or executor: Make sure the person responsible for administering your estate knows where to locate the inventory and access instructions.
Just as funding a trust ensures assets are connected to your estate plan, maintaining organized records helps ensure that digital assets in a will or trust can be identified, accessed, and managed when the time comes.
Is Your Estate Plan Ready for the Digital Age?
For many people, a meaningful part of their financial life and personal legacy now exists online. Family photographs, cryptocurrency holdings, business websites, email accounts, and online financial platforms may all require planning to ensure they can be located and managed when needed.
At Evans & Davis, we help families create estate plans that account for both traditional assets and the realities of an increasingly digital world. Having served more than 30,000 clients across the country, we understand that effective planning means preparing for the assets you own today, not just the ones that your estate plan may have addressed decades ago.
Call 866-708-2335 or contact us online to discuss estate planning for your digital assets.
