Why digital assets are crucial for your business
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    Finance

    Why digital assets are crucial for your business

  • Why digital assets are crucial for your business

    You can do almost anything online and many people choose to do so.

    In today’s digital world, most of our financial transactions and communications occur online. Photographs, websites and internet profiles are now almost expected for all of us. Without specific provisions in your estate plan and careful planning, access to this critical information can become difficult for your family or loved ones.

    On January 1, 2017, the Uniform Fiduciary Access to Digital Assets Act (the “Act”) became effective. California is the 11th state in the US to adopt this law which establishes a process for allowing your executor, trustee, Power of Attorney or a court-appointed conservator to access your online accounts after your death. This Act also allows you to designate some (or portions) of your account as “off-limits” after your death. This Act has been added to the California Probate Code sections 870 – 884.

    Your estate plan should be designed to make the administration process as easy as possible for your loved ones. This includes making it convenient for them to manage your assets upon your incapacity or death and saving them the hassle of sorting through your paperwork to collect assets and pay your bills after you are gone.

    Thanks to the internet, most companies provide you with the option to receive electronic statements, set up auto payments or allow you to pay your bills online. Many businesses are in favor of these methods and support online account management and paperless billing. It’s less expensive, more convenient and environmentally friendly for them to send out bills via email than it is to mail bills to each of their customers.

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    One issue with this type of account management is what will happen with these accounts when you die or become incapacitated? Without physical evidence of your bills or statements for your accounts, how will your successor trustee or family members be able to manage your bills or finances when the time comes? How will they know about bills due or money owed if they are unable to access your email or online accounts?

    Your Durable Power of Attorney and your trust instruments should include provisions consistent with California Probate Code sections 870 – 884 naming a fiduciary to act on your behalf for these critical accounts, assets and profiles.

    You can do almost anything online and many people choose to do so. These accounts have limited access with protected passwords which can create problems when the account holder dies because no one has access to their passwords. Planning now can save a lot of heartache later.

    DISCLAIMER: This article expresses my own ideas and opinions. Any information I have shared are from sources that I believe to be reliable and accurate. I did not receive any financial compensation in writing this post, nor do I own any shares in any company I’ve mentioned. I encourage any reader to do their own diligent research first before making any investment decisions.

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