What Happens to Digital Assets and Accounts When Someone Passes Away?

When someone passes away, family members may know where to find a will, property records or other important documents. However, digital accounts can be much harder to identify and manage.

A person’s digital assets may also need to be located, accessed, or handled. Without a plan in place, loved ones may not know what accounts exist, where important information is stored, or who has the authority to manage them.

What Counts as a Digital Asset?

A digital asset is generally an electronic record in which a person has a right or interest. Some digital assets have financial value, while others may be important because of the personal information or memories they contain.

Digital assets may include email accounts, social media profiles, cloud storage, digital photographs, online financial accounts, payment platforms, cryptocurrency, reward programs, websites, domain names and electronic business records.

Not every digital account is owned in the same way. In some situations, the user owns the content stored in an account but does not own the account itself. The provider’s terms of service may affect whether an account can be transferred, accessed, archived or closed.

Why Passwords and Access Instructions Matter

Passwords and account information can help a personal representative identify digital property. However, having a password does not always mean someone has legal authority to access or manage the account.

Digital account planning should address both practical access and legal authority. Unauthorized access may raise privacy, contractual or legal concerns, even when a family member is trying to help.

Passwords generally should not be placed directly in a will because a will may become part of the public probate record. Passwords also change frequently. A more practical approach may be to keep an updated account inventory in a secure location and provide instructions explaining where the authorized person can find it.

Common Digital Accounts Families Forget

Families may remember major financial accounts but overlook digital property connected to everyday activities. Common examples include:

  • Email and cloud-storage accounts
  • Social media and messaging profiles
  • Online banking, payment services and cryptocurrency
  • Subscriptions, memberships and rewards programs
  • Websites, domain names and online stores
  • Digitally stored photographs and personal files
  • Password-protected computers, phones and tablets

Certain digital assets may also need to be preserved, transferred, or managed based on their value and importance to the family.

What an Estate Plan Can Say About Digital Property

Estate planning documents can provide direction about who should manage digital assets and what that person may be authorized to do.

A will may address digital property after death, while a trust may provide instructions for managing digital property during the account holder’s lifetime, incapacity or after death. A power of attorney may authorize someone to handle certain digital assets during the account holder’s lifetime if the account holder becomes unable to manage them independently.

The instructions may address whether an authorized person can access, preserve, transfer, archive, delete or close specific accounts. The language should be clear enough to communicate the account holder’s wishes while remaining consistent with applicable law and the provider’s policies. Some platforms also offer legacy contact or account management tools. These settings may allow a user to choose someone to manage a profile, request deletion, download information or memorialize an account after death.

What Happens to Social Media When Someone Dies?

What happens to a social media account depends largely on the platform and the choices the user made before death. Some providers allow an account to be memorialized or permit a designated person to manage limited portions of the account or request its deletion. A provider may require a death certificate, proof of authority or other documentation before taking action.

Family members should not assume they can access an account simply because they know the password. The platform’s policies, privacy laws and estate planning documents may all affect what happens next.

Privacy Issues Families May Face

Digital accounts can contain private messages, financial information, medical records, photographs and information belonging to other people.

An authorized fiduciary may not automatically receive access to every type of content. Access to a list of communications may be treated differently from access to the contents of private messages. A service provider may also require legal documents or a court order before releasing information.

These restrictions can make the process more difficult, but they are often intended to protect privacy and comply with legal requirements.

How to Start Organizing Digital Accounts

Start by identifying accounts that contain money, important records, personal memories or ongoing obligations. Then consider what should happen to each account after death or incapacity.

Some accounts may need to remain active temporarily so a personal representative can obtain tax documents, business records, account statements or photographs. Others may need to be transferred or closed.

Keep the account inventory in a secure location and tell the person named to manage your affairs where it can be found. It may also be helpful to review the legacy settings available through email providers, social media platforms and cloud storage services.

When to Update Your Estate Planning Documents

Digital asset instructions should be reviewed when there is a major change in finances, family circumstances, business ownership or online activity.

An update may be appropriate after acquiring cryptocurrency, opening investment accounts, starting an online business, purchasing valuable domain names or changing the person named to manage your estate.

Because digital accounts and passwords change frequently, it is also important to review the account inventory periodically.

Talk With DGR About Digital Assets and Estate Planning

Digital property is now part of many estate plans. Addressing it in advance may help loved ones identify important accounts and better understand your wishes.

Dial, Grimm & Rupert helps individuals and families in South Carolina address estate planning and probate matters. If you have questions about digital assets, wills, trusts or powers of attorney, contact DGR to talk with the team about your next steps.

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Talk With DGR About Digital Assets and Estate Planning

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