How to prepare a digital estate plan

We live in a digital age. When we die, we leave behind a digital footprint. Yours might include online financial accounts, social media profiles, photo archives, business websites, cloud-stored files, cryptocurrencies and more. All of these assets generate value—be it monetary or sentimental—which creates a need for careful stewardship. You might have years' worth of family memories you've stored on the cloud or prepaid annual subscriptions to newspapers or software suites, for example.

As with other, more tangible property, it's important to establish ahead of time what will happen to each of your digital possessions after you're gone. That process is known as digital estate planning.

As with other estate planning components, a digital estate plan is legal documentation that directs how some of your assets—in this case, those created or stored in digital spaces—are to be treated, accessed and distributed after your death.

Your digital estate plan should convey four key types of information:

• What digital assets and accounts you'll leave behind
• Who has permission to access those after your death
• How they are to gain that access
• What to do with each asset and account

Digital estate planning calls for care and attention to detail, as it usually involves granting access to sensitive personal and financial information. The goal is to provide clear instructions to someone you trust, so they can manage all aspects of your online presence in a manner that reflects your wishes.

Because digital products and interactions have become increasingly ingrained in our day-to-day lives, a tremendous amount of stored information about us, our activities and our financial transactions is only accessible via the internet and other electronic systems. When you draw up your digital estate plan, you may be surprised at how complex and extensive the task can be. Some key elements to address include:

Much of our financial activity occurs online these days, so some of your most sensitive and valuable records are entirely digital. Think online billing or utility statements. After your death, it's important that they remain protected but accessible by your trusted digital executor.

• Banking accounts and payment apps
• Retirement, investment and brokerage accounts
• Insurance accounts
• Credit card accounts
• Cryptocurrency keys and non-fungible tokens (NFTs)

The bulk of your personal and business correspondence is likely via email, texting and other electronic messaging systems. You also may have a long history of social media activity. When you die, much of that content will remain on hard drives and the internet. It's important to establish ahead of time how you'd like it treated in the wake of your death.

• Email and messaging accounts
• Social media accounts (including stored photos and videos)
• Contact lists and address books

If you've purchased digital music, movies and books—or opened accounts to access online content (such as streaming services or audiobook downloads)—those are assets, just like any physical property you plan to pass to your heirs.

• Media files (songs, movies, e-books)
• TV, streaming and news subscriptions
• Gaming avatars and virtual assets

Do you pay your electric bill with an app? Schedule your kids' doctor visits through a patient portal? Plan for how you'll transfer ownership of treasured files and responsibility for completing household tasks.

• Medical records
• Computer, phone and tablet files
• Online shopping, delivery and ride service accounts
• Household bill pay accounts
• Photo storage/sharing services
• Travel reward points

If you run a business (whether you're fully self-employed or run a couple of side hustles), it almost certainly relies on digital technology. Ensure your professional electronic assets are treated in a manner that serves your heirs—and your customers.

• Websites and blogs
• Cloud data storage
• E-commerce storefronts
• Client data
• Domain names and web hosting services
• Monetized video and social media channels
• Writings, art and other creative work

Explicit instruction for how to treat each individual element of your plan is crucial. You might give a family member access to your email inbox while directing someone else to delete all your text messages. You might transfer ownership of a Shopify storefront to a business partner. For every digital asset, give clear direction about closing accounts, archiving content, scrubbing data or passing assets to others.

An important distinction: You address actual financial assets in traditional estate plan documents, not your digital estate plan. For example, if you have an online bank or brokerage account, the money in the account is part of your traditional estate. But the web-based interface you use to log in and access information about that money is part of your digital estate.

Without a digital estate plan in place, the people whom you want to access your accounts after your death likely will face obstacles due to:

• Security measures (including password requirements and data encryption)
• Laws and rules (including data privacy and criminal laws and accounts' terms of service agreements)

Given those barriers, your heirs might not receive assets you've earmarked for them. Years' worth of precious photos and videos may never be available to family members. Social media accounts might remain active without reflecting your death. And your accounts might be vulnerable to identity theft and hacks that could create financial problems for your beneficiaries—and damage the legacy you leave behind.

To create a digital estate plan, you must take a broad overview of all your electronic assets and interactions, then home in on crucial details about each one, documenting precisely how to access your information—and who may do so.

Make a list of all your digital assets and accounts. Include web URLs, usernames, passwords and other information someone will need to retrieve your data. For stronger digital asset protection and to ease access for your heirs, consider using password management software, which can encrypt and store login credentials for multiple accounts.

Store your inventory in a safe, secure location. Tell people you trust—family members or an attorney, for example—where to find it. And make sure it's easy for you to frequently access and update whenever you change a password, open or close an account, or acquire, sell or give away digital assets.

As with your will, your digital estate plan needs an executor—someone you authorize to oversee management and distribution of your belongings. Your digital executor will carry out your wishes related to your digital assets. That may include closing or memorializing accounts, distributing cryptocurrencies or digital files to beneficiaries, and safeguarding sensitive information. 

Your traditional executor will manage the treatment and distribution of your more traditional assets—such as money and property. It's OK to name a single executor for all aspects of your estate. But in some cases, it might make more sense to choose a dedicated executor for your digital estate plan. You want someone particularly savvy with technology, whom you trust to protect sensitive content and communications.

State whether you want accounts to close or remain in use by someone else. Specify whether you want your content history archived or deleted. Regardless of an asset's value, identify who should take possession of it and how that transfer should occur.

As you craft each instruction, consider not only its financial impacts but also its emotional implications for your loved ones. For example, the sudden disappearance of your social media accounts might be shocking and traumatic for friends and family who follow your account. You might instead ask your digital executor to convert your accounts to memorial pages, as a way of gently informing people about your death, yet still inviting online expressions of grief.

Some digital service providers let you designate a legacy contact or inactive account manager in advance. After your death, that person quickly can update, close, transfer or memorialize your account. If an account doesn't have a legacy contact, your digital estate executor can request access, but the process may go slower and require submission of a death certificate and other documents.

You can maintain your digital estate plan as a standalone document or incorporate it into your will. Remember: Your will eventually can become a public record, so leave details such as account usernames and passwords out of it. Store that information elsewhere.

It's also important that your plan's language aligns with local laws. The Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), adopted by most states, allows your executor to access specific content and accounts you've identified in your plan (except for accounts that already have someone else named as a legacy contact). But states differ slightly in how they define digital assets and electronic communication. To help ensure your instructions can be carried out as you envision, consider consulting with an attorney and/or using an online estate planning service.

Once you have a final, formalized digital estate plan, store a copy in a secure location. That could be with an attorney or online storage service—or in a safe or safe deposit box.

As with your will and other estate-related documents, review your digital estate plan regularly. Update it annually or after major life changes, such as marriage or retirement. Make sure it reflects your most recent account and asset changes, along with evolving laws about digital property.

When you think about all the ways technology touches your life, the notion of creating a digital estate plan can seem daunting. But don't let that keep you from tackling the task. Begin with just a basic list of the accounts you use most and the name of your digital estate executor. Over time, expand your plan with additional details. 

You may consider consulting with a Thrivent financial advisor, who can help you identify elements to include and provide insight about how to align your digital estate plan with your overall financial strategy.