Dearly Beloved, Welcome to the Digital Afterlife

It takes 26 hours for the average person to report a lost wallet and 68 minutes for a lost phone. Now imagine what would happen if your entire online presence was deleted? Poof!

Like everyone else, Canadians are relying more on digital devices and online accounts— and accumulating significant digital assets along the way. A recent Deloitte report estimates that by 2020, the average Canadian will have accumulated $10,000 worth of digital assets over a lifetime. As digital assets grow, so do the challenges of estate planning.

 

What’s a digital asset?

It’s digitally stored content or an online account that is owned by an individual. Digital assets fall into one of 3 categories:

  • Personal (email, photos, music, loyalty programs)
  • Social (Facebook, Twitter, Instagram, LinkedIn)
  • Financial (cryptocurrencies, bank accounts, PayPal, credit cards, tax documents)

 

“More than 10,000 Facebook users die every day and these dormant accounts continue to receive friend requests…”

 

Why is it important to plan for digital assets in death?

There are two kinds of digital assets: monetary value and sentimental value.

For financial assets, having the deceased’s email addresses and passwords gives access to bank accounts, trading accounts, PayPal, eBay, credit cards and loyalty point programs.

Then there are email accounts, as well as other digital accounts on laptops, mobile phones and on cloud computing platforms, that may contain photos or other content that has sentimental value to family and friends.

When it comes to social media accounts, each platform requires, at a minimum, various forms of identification or proof of death to delete a profile. For example, more than 10,000 Facebook users die every day and many of these dormant accounts continue to receive friend requests, get tagged in photos, and push out “Wish Jane Smith a happy birthday” messages to friends and family.

 

“Of key importance is having a comprehensive, up-to-date list of accounts and passwords.”

 

How to create a digital estate plan

Technology changes fast, so what’s the best way to do digital estate planning? We asked Toronto lawyer Rebecca Fisch, who specializes in estate planning and administration.

The first step in the estate planning process is to make a list of all valuable assets, including digital assets or online accounts.

“Digital assets are not really handled any differently than other personal effects. What’s important is to make sure that you have a list of all of them and how to access each one,” says Fisch. If the digital assets are significant, you can have an additional clause, separate from your personal effects clause, in your will. Of key importance is having a comprehensive, up-to-date list of accounts and passwords. The list should be updated regularly and kept in a safe place.

She recommends thinking beyond only your financial accounts passwords. You should also include passwords for email, social media, laptop and phone passwords. “In today’s climate, with the revelations of the Facebook data leaks, Facebook, Google or Apple are reluctant to give up someone’s password, even if they are deceased. New increased security measures mean that executors and family members of the deceased will have a harder time accessing these accounts,” says Fisch.

Accounting for digital assets in estate planning is still relatively new. However, with the rapid pace of digitization and technological development, there’s a high likelihood that eventually these assets will eclipse the value of our physical assets. Good record-keeping for our financial and sentimental digital assets may make things a little easier for those we leave behind.

 

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