The Digital Executor: A Client's Estate Plan CTO | Mylennium

The Digital Executor: A Client's Estate Plan CTO

The Digital Executor: A Client's Estate Plan CTO

The first part of this two-part post covered the intangible and elusive nature of digital assets and how most clients are unaware of the importance in addressing these assets in their estate plan.

A key first discussion to have with your client is whether they want to include a digital executor in their estate plan (Selecting a Digital Executor). Without a named digital executor, the responsibility for settling the client’s digital estate falls upon the executor who will likely need to look for outside professional expertise. If a digital executor has been named they should show their mettle by helping the client document their digital property and assets. In the absence of a digital executor, your client can seek the assistance of a professional digital executor service. As with many tasks in estate planning, clients may need a nudge in the right direction for their own best interests.

What are the risks of doing nothing?

Without planning, a lifetime’s worth of your client’s pictures, files and accounts may become inaccessible to beneficiaries. Social media accounts continue as if your client were still alive, inviting identity theft and embarrassing moments for friends and relatives who receive system generated “updates” from the deceased. Monetary assets in financial accounts, loyalty reward programs, and web related revenue will likely be lost. The fiduciary has an obligation to marshal, protect, and distribute estate assets and this includes the decedent’s digital assets. How many fiducaries meet this standard with regards to a decedent's digital assets?  Clients and estate attorneys need to become more proactive addressing the risks associated with digital assets and address them in an updated estate plan to better protect their clients, employers, and beneficiaries.

Professional Digital Executor Services

Your clients depend upon your expertise to help them protect their assets and plan for the future. Recently, a new class of company has appeared in the digital legacy space, “digital executor services”, to provide personalized services to help clients document and protect their digital estates. Mylennium is an example of this new breed that works together with the client and their estate planning professional to ensure that a client’s digital estate is documented, legally sound, and prepared to survive across generations. A key deliverable from any digital executor service is a Digital Asset Report that itemizes the client’s digital property, provides details needed to gain access to their passwords, includes information regarding any disk or file encryption used to protect digital assets, local and remote backups, and features a comprehensive digital asset inventory with disposition instructions, and final posts to social media accounts.  With the client’s digital asset report in hand, you are ready to draft the language that authorizes the (digital) executor’s access to the client’s digital devices and their online accounts and services.

Digital executor services can also provide the needed expertise and assistance to help a client incorporate the use of a password manager into their daily digital workflow. Without a current list of usernames and passwords, an executor would be at a loss trying to access password protected devices, online accounts, and encrypted files and folders. Password management software integrates with the user's daily computer use and keeps password changes in sync with the password database, ensuring that digital executor has the most current authentication credentials at the appropriate time.

A digital executor service should identify Terms of Service agreement limitations imposed by services used by the client.  While some online providers prohibit third party access, most permit fiduciary access with the account owner’s permission and provided credentials. Avoid digital legacy services that require an account owner to login and manually keep their usernames and passwords in sync across increasingly regular password changes. Most categories of service (email, photo/video/document storage, loyalty reward, remote backup) have well-known alternatives that allow digital assets to be accessed by fiduciaries and transferred according to the account owner’s wishes. It’s important that a client know their options so they can make informed choices of their chosen web service's digital legacy support.

First Step is the Most Important

Digital estate planning details should be reviewed whenever the client’s overall estate plan is reviewed, typically on a yearly basis. Several elements of the Digital Asset Report will change with some frequency, including personal digital property, passwords, and online services so be sure your client updates the Digital Asset Report as well. The digital executor or digital executor service should be included in this process. State probate law continues to be in flux concerning fiduciary access to a decedent’s digital assets and online accounts. As of this writing, states that have enacted laws specifically addressing digital assets include Connecticut, Delaware, Idaho, Indiana, Nevada, Oklahoma, Rhode Island, and Virginia. Several other states are in the process of adopting legislation.

As with most things, the first step you take addressing the inclusion of digital assets in your client’s estate plan is the most important one. Helping your client select a digital executor or a digital executor service will play an important and lasting role in a successful transfer of digital assets across generations. Under the guidance of an experienced digital executor, your client will understand the scope of their digital estate and take the necessary steps to identify and protect the digital assets in their estate.