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Your growing digital estate requires thoughtful planning

by Michael Flannery | Contributor
April 29, 2020

The COVID-19 pandemic has had far-reaching consequences on everyone, include attorneys and clients concerned about estate planning. This pandemic has been a catalyst for writing wills, powers of attorney, advance directives and other legal documents. However, it has also been a roadblock for traditional estate planning procedures, like the witnessing and notarization of wills. These roadblocks can be overcome with greater planning of digital assets and the use of the Electronic Wills Act and Remote Online Notarization (RON).

The COVID-19 pandemic has motivated many people to start to consider more carefully their end-of-life estate plans. And rightfully so. The nondiscriminatory and unforgiving relentlessness with which the pandemic takes lives has left everyone considering their own mortality and their preparedness for transferring property to their loved ones. COVID-19 has been an estate-planning wake-up call.

But before you rush to your attorney's office to finally write the will you have been putting off, it is important to consider what assets are in your estate plan that you need to pass on and how the pandemic has affected your ability to plan your estate.

The pandemic's health effect is the most immediate factor in getting people to finally act on their estate plans, but startling people into awareness is not its only consequence. The pandemic has had a significant practical effect on the ability to estate plan as you normally would. For example, the need for social distancing has inhibited your ability to discuss your goals with your lawyer or advisor in a hands-on, face-to-face conversation, and it has forced everyone to think more digitally about the nature of your plan and how you implement it. In addition, it should prompt you to consider the assets that make up the digital component of your estate and how they fit into your end-of-life plan.

How can a pandemic affect how you implement your estate plan?

COVID-19 has created a flurry of estate-planning activity with people scrambling to draft wills and end-of-life directives. But the social distancing required has had a significant impact on the estate planning process.

For example:

  • When before you might take tours of nursing homes to evaluate where you might want an elderly parent to reside during a period of long-term care, this is not possible during a pandemic. You may need to rely on a geriatric case manager to provide details of available resident facilities or find an elder care service that provides digital or virtual tours of potential nursing homes.
  • When previously you might sit down with an attorney and discuss your life goals, tax status and retirement plans to develop an estate plan, now you might discuss your goals with your attorney via a virtual Zoom or Skype session, or perhaps simply over the telephone. This can significantly reduce the educational value of a live, one-on-one exchange between attorney and client, during which both can think through problems and anticipate contingencies.
  • When previously you would execute documents with witnesses present in the same room and a notary public standing by to notarize, now you will likely have witnesses sign documents from behind glass or in an adjacent room, if they are even present at all.
  • When previously you would execute documents with witnesses present in the same room and a notary public standing by to notarize, now you will likely have witnesses sign documents from behind glass or in an adjacent room, if they are even present at all.

The increase in electronic mediums

Because of the current pandemic, more and more people are rushing to use online services to create standard estate planning documents like:

  • Wills
  • Living trusts
  • Advanced directives
  • Powers of attorney
  • Revocable trusts

Online electronic services do offer a cheap and quick opportunity to create basic legal forms to address estate planning needs.

However, standard estate forms printed off a website are not guaranteed to comply with the individual probate laws of each state. Nor are they designed to deal with the practical limitations of a pandemic.

For example:

  • Wills and other estate planning documents may require the signature of a notary public, which, during a pandemic, may not be possible without the ability to be together at the same time in the same place.
  • Standard documents, like a durable power of attorney, printed off a website may allow a designee to make life-sustaining choices for the client when the client becomes incapacitated from COVID-19. But what if the client is not incapacitated by COVID-19 but is only prohibited from re-entering the country and, therefore, is unable to operate their business or get online come April 15 (now July 15) to prepare or file tax returns? Is the standard online power of attorney form designed to accommodate these circumstances?

The Uniform Electronic Wills Act

Although online electronic wills have been available for some time, they still have to be signed, witnessed and notarized by hand and in person. But with the advent of the 2019 Uniform Electronic Wills Act, now adopted in a handful of states, completely digitized wills, with remote online notarization (“RON”) is now a possibility.

RON was originally applied to standard business documents. The process goes something like this:

  • A business entity uploads documents to be notarized.
  • The applicable RON platform notifies the client that documents are ready to be signed.
  • The client accesses the website and authenticates their identity, account information, etc.
  • A remote notary joins the client in a two-way, recorded audio/video session.
  • The notary authenticates the documents, which the client signs and the notary notarizes electronically (the client and notary can see and hear each other sign the documents).
  • The fully executed documents are electronically returned to the business entity and the client.
  • The recorded authorization is digitally deposited into the notary's electronic journal with information about the documents.

RON is already accepted in almost half the states, although there are exceptions in most states for wills. However, in several states, the Electronic Wills Act, which includes the use of RON is now available. And during the COVID-19 pandemic, some governors have issued executive orders authorizing the use of RON during the pandemic.

Signing documents through a laptop

Although there are aspects of the online witnessing and notarization of estate planning documents that many legal professionals take issue with, such as the potential for fraud and undue influence, the threat to confidentiality and online security, etc., RON certainly addresses the need for a digitized execution process during a pandemic.

But creating a fully electronic will with remote online notarization, which results in no physical documents being printed, raises additional considerations. Your will has now become part of your digital estate, along with other digital assets that, themselves, create difficult legal issues relevant to your estate plan — primarily, accessibility upon death. Because your digital assets are just as much a part of your estate when you die as your physical assets, having a digital will begs the question of how to include your digital assets in your end-of-life estate plan — especially during a pandemic.

What should be in your digital estate and how does it fit into your end-of-life plan?

Your estate consists of digital assets that must be administered upon your death.

These could range from financial interests held in accounts at banking institutions to data contained on social media accounts and frequent-flyer miles collected on airline websites. In fact, your digital assets could include any of the following:

  • Facebook, Twitter, LinkedIn and other social media accounts
  • Blogs and websites
  • Bank accounts
  • Brokerage accounts
  • Retirement Plans
  • Credit cards
  • Loans
  • Insurance accounts
  • Email accounts
  • Online Apps from retail stores
  • eBay, Amazon, iTune accounts
  • Photo and video sharing sites like Flickr or YouTube
  • TV accounts like Netflix and Hulu
  • Music sites like Pandora
  • PayPal
  • Utilities
  • Data storage on platforms like Google Docs
  • Digital wallets
  • Discount Apps for restaurants using phone scans (like Starbucks)

As you can see by the length of this incomplete list, your digital estate is comprised of any interest, asset, account or online platforms with which you input data or hold personal information. Now you can add your electronic will to this list.

Whenever you change a password or open or close an account, you are modifying your digital estate. When you create an electronic will using RON and your electronic will is digitally stored, it becomes part of your digital estate.

Managing your digital estate during a pandemic

Without question, the COVID-19 pandemic has been a catalyst for people to execute wills, powers of attorney and advance directives. Not only has it changed the way people think about their own mortality and their legacy, but it has changed the face of the way we conduct our estate planning. It should not be a surprise if long after the COVID-19 pandemic is behind us, the digital nature of wills, estates and estate planning services remains in place. Because of that, here are five tips for managing your digital estate during (and after) a pandemic:

1. Review your estate plan regularly.

Whether your estate contains many digital assets or none, you should review your estate plan regularly (at least once a year) and consider any changes that should be made.

2. Consider including an electronic will in your digital estate plan.

Many states have authorized RON during the pandemic and, as a practical matter, it is an opportune time to take advantage of its availability and accessibility. However, when this pandemic subsides, consider using RON if your state has adopted the Uniform Electronic Wills Act. If it has not already, it may soon.

3. Store your legal documents in a safe place.

Be sure to store all your legal documents and your digital data in a safe place. Original wills and other end-of-life documents should be held by you or your lawyer. If you create electronic wills or use RON, be sure the services you use are safe, confidential and secure.

4. Provide information for access to digital assets to someone you trust.

Your digital assets are of no use to you after you are deceased, but you will want to preserve most of your digital assets for your family and loved ones. Certainly, this applies to your electronic will. Therefore, you must be sure to provide access to your digital assets to your executor of your will or someone whom you trust. This includes all access identification information and passwords. You should create a list of all of your digital assets (see an incomplete list of common digital accounts above) with their respective access information and provide this list to your executor. Note that some digital account policies will place restrictions or requirements on access to digital accounts and information, limiting access to the account holder unless specific procedures are followed. These policies may supersede any authorization granted in your will.

5. Prepare.

If we have learned anything from this pandemic, it is that we must prepare for the next one. There will be others. Even if the next pandemic does not occur in your lifetime, you will experience other chaos in your life that bears directly on your estate plan. We are learning now that we must prepare our estate plans for these as well. And we must prepare for a more digital approach to how we conduct our estate planning during times of chaos.

During a pandemic, include your digital assets in your will and include your will in your digital assets.

Ironically, although the COVID-19 pandemic has forced us to separate ourselves through social distancing, working from home and staying away from large groups, it also has brought us closer together — by directing us to our families, unifying community efforts and providing greater electronic access and connectivity to others. In the world of estate planning, this has included attorneys, clients, testators, witnesses and notaries.

In an ideal world, we wouldn't need the Electronic Wills Act or RONs. They would serve as mere conveniences. But in the real world, which includes pandemics like COVID-19, these conveniences are necessities. These necessities are available to you to effectively plan your estate during this pandemic. We encourage you to take advantage of them now and to continue using them, when available and appropriate, after this pandemic is gone, so that you will be prepared for the next one, in whatever form that may come.

How do I create an estate plan?

There are numerous options and scenarios to consider when developing an estate plan that protects your legacy and achieves your objectives, and important decisions should be made with the advice of qualified lawyers and financial experts. Membership with Legacy Assurance Plan provides members with valuable resources and guidance to develop comprehensive estate plans that take life's contingencies into consideration and leave a positive impact for generations to come. Legacy Assurance Plan members also receive peace of mind that a team of trusted, experienced professionals will assist them in developing legal, financial and tax strategies that will meet their needs today and for years to come through periodic reviews.

This article is published by Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at legacyassuranceplan.com.

Phone - 844.445.3422
Email - info@legacyassuranceplan.com
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