The question of digital asset planning is rapidly becoming paramount in estate planning, eclipsing traditional concerns with physical property. For years, we focused on wills, trusts, and tangible possessions, but now a significant portion of our clients’ wealth and important information exists solely in the digital realm. This includes everything from cryptocurrency and online accounts to social media profiles and digital photos. Steve Bliss, as an Estate Planning Attorney in San Diego, recognizes this shift and provides comprehensive digital asset planning services to ensure these crucial elements are managed according to our clients’ wishes, even after they are gone. Approximately 70% of adults now have some form of digital asset, and that number is projected to rise exponentially, making proactive planning vital.
What exactly *are* digital assets?
Digital assets are any digital files or accounts that hold value or sentimental importance. This is a surprisingly broad category. It includes things like online banking and investment accounts, email accounts, social media profiles (Facebook, Instagram, Twitter, etc.), photos, videos, music, domain names, loyalty program points, and even virtual property in online games. Cryptocurrencies like Bitcoin and Ethereum are also prominent digital assets. A key challenge is the often-complex terms of service agreements that govern access to these accounts, which frequently prevent family members from easily accessing them upon death. According to a survey by the Digital Assets Planning Institute, over 80% of estate planning attorneys report an increase in client inquiries about digital asset management.
Why is digital asset planning necessary?
Without a clear plan, accessing and managing a deceased person’s digital assets can be incredibly difficult, if not impossible. Consider the frustration of not being able to access cherished family photos or the complications of settling a digital currency estate. Family members might face legal hurdles, account lockouts, or loss of valuable assets. Moreover, simply listing digital assets in a will isn’t always enough. Most online platforms require specific procedures, such as a digital executor or a designated contact person, to grant access. Steve Bliss emphasizes that effective digital asset planning is about more than just listing accounts; it’s about creating a legally sound and technically feasible plan for accessing, managing, and distributing those assets.
What does a digital asset plan involve?
A comprehensive digital asset plan begins with a detailed inventory of all digital accounts and assets. This inventory should include usernames, passwords, account details, and instructions for accessing each account. It’s crucial to maintain this information securely, using password managers or encrypted storage. The plan should also designate a digital executor – a trusted individual with the technical expertise to manage the assets. This digital executor needs to be authorized through the various platforms’ procedures. Furthermore, the plan should outline how each asset should be managed – whether it should be transferred to a beneficiary, closed, or preserved as a legacy. We work with our clients to create legally binding documents, such as powers of attorney or trust provisions, that specifically address their digital assets.
What happens if you *don’t* plan for your digital assets?
I recall a situation with a client, Mr. Henderson, a successful online entrepreneur. He had built a thriving business selling digital art and NFTs, but he never considered including his digital assets in his estate plan. After his unexpected passing, his family struggled for months to access his accounts, losing valuable NFTs and revenue. The terms of service agreements were complex, and they lacked the necessary information to prove their legal right to access the assets. It was a heartbreaking experience for them, and it highlighted the critical need for proactive planning. The entire situation could have been avoided with a comprehensive digital asset plan and designated digital executor.
How do you securely store digital asset information?
Security is paramount when it comes to digital asset information. Simply listing passwords in a will or leaving them on a flash drive is not secure enough. We recommend using a combination of methods, including encrypted password managers, secure cloud storage, and a locked physical safe for backup copies. We also advise clients to regularly update their passwords and enable two-factor authentication whenever possible. It’s also important to remember that digital information is vulnerable to hacking and cyber threats. Therefore, we emphasize the importance of robust security measures and regular updates. According to a report by the Identity Theft Resource Center, data breaches have increased by over 68% in recent years, making data security more crucial than ever.
Can a trust be used to manage digital assets?
Absolutely. Trusts are a powerful tool for managing all types of assets, including digital ones. A properly drafted trust can provide clear instructions for accessing, managing, and distributing digital assets according to the grantor’s wishes. The trust document can specify the digital executor and grant them the necessary authority to manage the assets. It can also outline how the assets should be distributed to beneficiaries. A trust offers several advantages over a will, including privacy and the ability to avoid probate. It is often the most effective way to ensure that your digital assets are handled according to your wishes. We can tailor the trust provisions to address the unique characteristics of each client’s digital assets.
What if I don’t have a lot of digital assets? Is planning still necessary?
Even if you don’t have significant financial digital assets, planning is still crucial. Consider the sentimental value of family photos, videos, and social media accounts. What would happen to those memories if you were no longer around? Would your family be able to access them? Planning ensures that these cherished memories are preserved and accessible to future generations. I remember another client, Mrs. Davies, who didn’t have much in the way of financial digital assets, but she had a lifetime of photos and videos stored on her phone and social media accounts. She wanted to ensure that her grandchildren would have access to those memories after she was gone. We created a simple plan that allowed her family to easily access and preserve those cherished photos and videos. The peace of mind it gave her was immense.
About Steven F. Bliss Esq. at San Diego Probate Law:
Secure Your Family’s Future with San Diego’s Trusted Trust Attorney. Minimize estate taxes with stress-free Probate. We craft wills, trusts, & customized plans to ensure your wishes are met and loved ones protected.
My skills are as follows:
● Probate Law: Efficiently navigate the court process.
● Probate Law: Minimize taxes & distribute assets smoothly.
● Trust Law: Protect your legacy & loved ones with wills & trusts.
● Bankruptcy Law: Knowledgeable guidance helping clients regain financial stability.
● Compassionate & client-focused. We explain things clearly.
● Free consultation.
Map To Steve Bliss at San Diego Probate Law: https://maps.app.goo.gl/tKYpL6UszabyaPmV8
Address:
San Diego Probate Law3914 Murphy Canyon Rd, San Diego, CA 92123
(858) 278-2800
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| San Diego estate planning lawyer | San Diego probate lawyer | Sunset Cliffs estate planning lawyer |
Feel free to ask Attorney Steve Bliss about: “How much does it cost to set up a trust in San Diego?” or “What is a bond in probate and when is it required?” and even “Can I include burial or funeral wishes in my estate plan?” Or any other related questions that you may have about Probate or my trust law practice.