Your digital life has real value, and without a plan in place, the accounts, files, and online property you leave behind can be difficult or impossible for your loved ones to access, manage, or inherit.
Key Takeaways:
- Digital assets, including online accounts, cryptocurrency, digital files, and intellectual property, are part of your estate and deserve the same intentional planning as physical and financial assets.
- Without proper legal authorization, even your closest family members may be unable to access your digital accounts after your death, and some platforms may permanently delete accounts and their contents before anyone knows what to do.
- NC Planning provides proactive and invaluable legal planning that helps you take stock of your digital life, document access in a legally sound way, and ensure your digital assets are handled according to your wishes.
When most people picture an estate, they think of a house, a bank account, maybe an investment portfolio. But today, a significant and growing portion of what we own exists entirely online. You may have a PayPal account with a balance, a library of purchased music or ebooks, a social media presence built over years, photos stored in the cloud, domain names or websites, or cryptocurrency worth thousands of dollars. All of that has value. And without a thoughtful plan in place, much of it could become inaccessible, locked away, or lost entirely when you pass away.
Many people have never thought about what should happen to their Gmail account or their Spotify library or their Venmo balance. And most estate plans drafted even five years ago make no mention of digital assets at all. At NC Planning, we help clients build estate plans that reflect the fullness of their lives, including the digital dimension that has become central to so many of them. Our latest blog outlines what you need to know about preserving these assets in your estate plan.
What Counts as a Digital Asset?
The term “digital asset” covers more ground than most people realize. At its broadest, a digital asset is any content or account that exists in electronic form and carries value, whether financial or personal. That definition includes a wide range of things:
- Financial digital assets are perhaps the most urgent to plan for. Cryptocurrency, such as Bitcoin or Ethereum can be worth a great deal of money, but unlike a bank account, it cannot be recovered without the proper access credentials. If your private keys or seed phrases are not accessible to a trusted person, those funds may be permanently unrecoverable. Online payment platforms like PayPal, Venmo, or Cash App may hold balances. Brokerage accounts managed entirely online may require specific steps for a family member to access or transfer.
- Personal and sentimental digital assets include your photos, videos, and documents stored in cloud services. Years of family memories may sit in Google Photos or iCloud. Personal journals, creative writing, or correspondence stored digitally all fall into this category as well.
- Accounts and subscriptions represent another dimension. Your email account may hold irreplaceable correspondence or documents needed for other parts of your estate administration. Social media profiles may carry memories your family wants to memorialize or close. Streaming services and digital storefronts may hold purchased content.
- Business and creative digital assets carry financial significance beyond personal value. If you operate an online business, own domain names, run a monetized YouTube channel, or sell creative work through digital platforms, those assets may generate ongoing revenue or carry intellectual property rights that need to be addressed in your estate plan.
Why Your Family May Not Be Able to Access Your Accounts
One of the most common misconceptions about digital assets is that a spouse or child can simply log into your accounts after you pass away. In reality, that is often not how it works, and in some cases doing so could technically violate federal law.
Most major platforms, including Google, Apple, Meta, and Microsoft, have terms of service that govern what happens to accounts after a user’s death. Some platforms have specific legacy or memorialization policies that allow a designated person to access or close an account. Others may simply lock or delete accounts with no provision for family access. Without advance planning and proper documentation, your loved ones may find themselves unable to recover anything.
The federal Stored Communications Act presents another layer of complexity. Because of the way this law is interpreted, access to the contents of electronic communications like email can be restricted even for authorized representatives of an estate. Several states have passed laws to address this, and North Carolina has adopted its own version of the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which provides a legal framework for granting access to digital assets.
How to Include Digital Assets in Your Estate Plan
Bringing digital assets into your estate plan involves several steps, and the right approach depends on the nature and value of the assets involved.
- Create a comprehensive digital inventory. The first step is simply knowing what you have. This means making a list of your accounts, subscriptions, online platforms, cryptocurrency holdings, and any other digital property. For each item, note where it is held, what its approximate value might be, and any relevant information about accessing it.
- Use platform-provided tools where available. Some platforms have built in legacy planning features. Google has an Inactive Account Manager that allows you to designate someone to receive your data or instruct Google to delete it after a period of inactivity. Facebook allows you to name a Legacy Contact. Apple offers a Digital Legacy feature for designating someone to access your Apple ID data after your death.
- Address access in your estate planning documents. Your will and any trust documents can be updated to name a digital executor, a person you specifically authorize to manage your digital assets. Under North Carolina’s RUFADAA framework, you can also grant your trustee or personal representative explicit authority to access specific digital assets.
- Document credentials securely. Passwords, private keys, seed phrases, and account recovery codes need to be stored somewhere accessible to a trusted person without being so exposed that they create a security risk during your lifetime. Options include secure password managers that allow emergency access, a sealed envelope kept with your estate documents, or a letter of instruction addressed to your executor. Avoid storing this information in your will itself, as wills become public record through probate.
- Consider the tax implications of cryptocurrency. If you hold cryptocurrency, your estate plan should account for the fact that these assets may carry significant capital gains and could affect your estate’s overall tax position. Proper documentation not only makes access possible but also ensures that whoever inherits these assets has the information needed to handle the tax consequences appropriately.
What Happens If You Do Nothing
If you do not take steps to include your digital assets in your estate plan, your family may face a difficult process. They may even never know about assets you held, because there is no physical statement or document to find.
Accounts with no designated beneficiary or estate access authorization may be locked or deleted. Cryptocurrency held without documented access credentials may be unrecoverable. Platforms may require court orders to release information, adding cost and delay to what is already an emotionally taxing time.
For assets that carry significant financial value, such as cryptocurrency or a well-established online business, the stakes of not planning can be substantial. For assets that carry personal value, such as family photos or correspondence, the loss may be irreplaceable in a different but equally meaningful way.
Start Building a Plan That Covers Your Whole Life
Your estate plan should reflect your life as it actually exists today, and for most people that means it needs to account for the digital dimension. At NC Planning, we take a proactive approach to estate planning that starts with listening to you about what you have built, what you value, and what you want to protect. Then we help you put the legal structure in place to make sure your wishes can actually be carried out.
Digital assets are one of the areas where planning ahead makes the most difference, because the window for taking action closes at exactly the wrong moment if nothing is done in advance. Our team is here to help you take that step with clarity and confidence.
Schedule an introductory call today and let NC Planning help you build an estate plan that is built for the life you are actually living.
