With the adoption of digital technologies in our daily lives, digital assets have continually become more prominent, increasing the importance digital estate planning.
A Digital Estate Plan permits you to properly organize your digital assets and ensure that these are handed over to your dependents or loved ones. Though digital estate planning is important, 50 percent of Americans are not making digital estate plan due to lack of knowledge on how to do it. At Clocr, we aim to make digital estate planning easy for everyone. Today, we’ll dive into the step-by-step process to create a digital estate plan.Preparation Prior to Digital Estate Plan
The process of creating a digital estate plan is not rocket science, it simply requires is keen observation. Before kick-starting the process, one needs to first, sit down and ask yourself questions simple questions like:
- What digital assets I do have?
- What are the important assets that my dependents may need after my death?
- Which asset should be handed over to whom?
- How can I secure all this data and make sure your beloved one gets it?
Process for Creating Digital Estate Plan
Step1: List out Digital Assets
This is a crucial step in the digital estate planning process. Forgetting even one digital asset can be disastrous. Wondering how? An incident where the sudden demise of Quadriga Fintech Solutions, CEO, Mr. Gerald Cotten’s resulted in losses close to $200 million, as he did not share the company’s cryptocurrency and bitcoin passwords and recovery keys without anyone prior to his death. This incident is a wakeup call for the company and outsiders alike to create a comprehensive list of all digital assets.
Remember that digital assets are not simply those with monetary value. The digital assets include logins for social media accounts, utility accounts (electricity, internet, mobile phone, etc.), computer hardware, hard disks, blogs, investments, data (images, videos, files, messages), software, credit card reward points, bank accounts, shares, email accounts, websites, bitcoins, E-commerce accounts, cloud storage, policies, cryptocurrencies and other related items.
Step 2: Categorize Assets: Decide How to Access What
Not all digital assets can be shared with your friends, family, or loved ones. If you are working in a company, the company policies may not permit you to share professional assets with others. Also, some assets you may wish to save with specific persons, while some you don’t wish to disclose and instead delete them.
So, based on with whom you share and what you want to do with it, categorize all digital assets under various categories. After this step, do not forget to mention this in your last will and also keep the Executor informed about this to avoid conflict in the distribution process.
Step 3: Secured Storage
Once you are done with categorization, the next step is the secured storage of digital estate plans and assets. To securely store information, you can choose: online storage services, attorneys or locked file cabinet. How much ever securely you may store, choose someone whom you trust to execute the digital estate plan and inform attorney about that person by mentioning in the last will.
Step 4: Make the Digital Estate plan Legal
To avoid conflict in the digital asset distribution process, it is recommended to get the digital estate plan legally authorized by an attorney in writing. With respect to the legal authorization process, each state adheres to different laws. To develop a uniform protocol for every state, the Uniform Law Commission (ULC) has developed Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) for Executors or attorneys to follow in dispersing the digital assets as per the digital estate plan. It is good practice to mention Executor’s name in the legal document so that, under supervision of the legal framework as per the digital estate plan, the data assets will be distributed.
Clocr, short form for Cloud Locker, is an ultra-secure cloud-based safe deposit box for your most valuable digital documents. Services include all-in-one digital asset management, legacy planning, and disbursement. You can have peace of mind knowing that your family’s documents are safe and accessible, when needed.
Clocr offers a unique, secure, and easy way for individuals to share, track views, and store vital financial, business, and personal documents.
The Clocr Dashboard provides summary information about your accounts and assignees. There is a built-in alerting and messaging process that periodically informs you and your assignees.