What Happens to Our Digital Assets After We Pass Away?

Written by Timothy Bock on .

So you've crafted a plan for how you want your wealth, possessions and other assets to be distributed after you die. But what happens to your digital assets—online bank and investment accounts, social media profiles like Facebook and LinkedIn, and access to shopping sites like Amazon and Ebay?

This is a gray area with no definite rules for guidance. But it is possible to set up some common-sense directions to heirs that can help them manage the transfer of our digital presence along with your more tangible assets.

These are important plans to make and incorporate into your estate plan. In the aftermath of your passing, your spouse, family members and other loved ones will be dealing with grief. Managing the transfer of monetary assets will be difficult enough. Add to that the challenge of taking care of your online accounts can create an emotionally overwhelming situation for family members.

Complicating matters are the Terms of Service agreements we all agree to whenever we set up an online account or social media profile. Buried within the legal jargon in these agreements is language that spells out how your accounts can be closed out or transferred in the event of death.

It may seem easy enough just to give a family member access to these digital accounts by sharing usernames and passwords. But by clicking “I agree” in the Terms of Service agreements, we actually enter into a contract with the site manager. Sharing information like passwords with others is a violation of the contract, and can be considered an illegal offense according to federal law.

You should also consider granting power of attorney to someone you trust. This may not help them much in bypassing the rules of the Terms of Service agreements. But assigning power of attorney at least makes your intentions clear in a legal document and can give this person some leverage or authority when carrying out your final wishes.

Before you can decide how you want your digital assets managed after your death, you first need to take an inventory of your accounts. The simplest way to do this? Write down all the websites you use in a week or month that require log-in information, and then, either in a secure document on your computer or in a notepad, write down the website, your log-in name and your password.
You don't want to include these user names and passwords in the will itself, because it is a public document. Instead, specify in the will the location of the list. Once you've accounted for all your digital assets, make sure you take the following steps to protect them.

Financial data

This is perhaps the information most crucial to your heirs and some of the hardest to access. The types of accounts include the obvious bank and investment accounts but also services you use to check on those investments, such as Yahoo! or MSN.com. If you can, specify your beneficiaries directly on the websites of the financial institutions.
Download and/or print out your account statements monthly or quarterly. This creates a hard copy of the information either on paper or on your personal computer, eliminating the problem of accessing your accounts. Anything on your personal computer will become part of the estate, and the estate will access the information, and they will distribute the information that is on it. What they can't do is jump through the computer and to your online accounts.

Email accounts

Your first step should be to read the account's terms of service (TOS). We know — no one really reads the fine print when signing up for an online service like email. Still, this document contains important information about what happens to your account when you die. Some email providers, like Yahoo!, consider your account terminated upon your death.

Every online account is governed by a TOS agreement, and they're all different. In almost all cases, the TOS gives you a nontransferable license, which means that nobody else can access your account after your death.

It's important to remember that strict federal law governs the release of private messages like email. Federal law doesn't allow these email services to divulge the contents of these communications without a court order or consent from the individual. If you want your heirs to be able to access your email after you're gone, it is recommended that you draft a statement to that effect. This document can help others carry out your wishes and can be added to your will. Unfortunately, the law in this area is still in its infancy and much uncertainty remains.

Social media accounts

As with email, the rules regarding what happens to your Facebook or Twitter account upon your death are spelled out in the TOS agreement. But several social media sites have also begun offering additional services. In 2009, Facebook added a feature that allows friends and family members to share memories of a deceased loved one on his or her Timeline. The service can be activated once the site receives proof of that person's death, and deactivated at a family member's request. In April 2013, Google launched Inactive Account Manager, which allows individuals to designate up to 10 trusted friends or relatives as beneficiaries of their online accounts.

Music, e-books and more

When you download a song from iTunes or a book to a Kindle or other e-reader, you don't actually own the item. Instead, you purchase a license to use the download during your lifetime. In some cases what you think you own and what you actually have a legal right to pass on are very different. Some of these things just can't be transferred. So don't promise someone your amazing iTunes collection before making sure that it's yours to pass on. (You can find out by reading the TOS agreement.)

Photo-sharing sites such as Shutterfly and Flickr are a great way to share memories of vacations and grandkids, but if you want your heirs to be able to access your digital photos after you're gone, it is recommended that you download your favorites and save a copy to your hard drive. This will make it easier for your most treasured images to stay in the family. Also, your loved ones won't have to sort through thousands of images after your death.

Most of all, do as much as you can about your digital assets in advance, if only to help your family and loved ones deal with these complicated matters in a time of grief. Making their lives a little easier in your absence can make a tremendous difference when it may matter most.

If you are looking for more guidance on transferring assets or creating estate or legacy plans for your family, call Tim at (800)683-5800 or email us at This email address is being protected from spambots. You need JavaScript enabled to view it..