0:00 hello and welcome to trust and Estates weekly I'm your host Kevin bemel and we're here every Monday at 10:00 a.m. Pacific time to talk about all matters relating to trust probate and estate both from a planning uh perspective and from an Administration perspective whether it's for your own situation or as a professional so like me I'm a professional fiduciary I administrate Estates uh for other people so today we're GNA talk about a
0:36 um uh a topic that gonna sound repetitive here a topic that's I I would think would be more topical and yet I I haven't seen it addressed in any of the trainings and and meetings that I've I've come across and that is um the topic of uh digital estate planning so um I I I haven't done this for a while I put together a a PowerPoint um to go over some of these
1:11 issues and I'm going to jump right into it because because there's a lot to talk about here okay so one second there we go and I'm just just moving my notes over uh so that um we can uh you know what that's it's gonna have to go over here okay sorry about that um okay so here we are digital States planning um and so next slide we'll go okay so haven't talked about the three pillars of attainment uh recently but um everything
1:49 we do in the way to wow shows relates to the three pillars of attainment um self relationships Pursuits on this show we deal primar arily in the Pursuits pillar primarily in the finances realm although because we're talking about Estate Planning and administration it inevitably deals with relationships as well as our self our identity our mindset Etc so if and if you if you if you're new to the way to wow shows uh there's a whole show on the three pillars of attainment just go to
2:25 um our my YouTube channel and and check it out there okay so in dealing with digital estate planning the first thing we need to do is make an accounting of All Digital assets I use that term somewhat Loosely um because they won't necessarily have intrinsic value per se but they they they may they have value to us okay and
3:00 you can see the list here online accounts number one so these can be social media accounts these can be email accounts online banking and investment accounts okay so the online aspect of these things there's no value in that per se while the bank account will have money in it and the money has value the online access in and of itself isn't an asset of your estate per se however it is something that needs to be dealt with
3:36 now out of I have talked previously about dealing with social media accounts um this is this has been somewhat problematic um over the last few years and most if not all of the social media companies have developed policies on how to deal with accounts of uh deceased people but social media accounts are just one aspect of this so again there's email accounts you may have um Gmail accounts Yahoo mail even AOL I think some people still have what is going to
4:13 happen with all of these what's going to happen with the um the emails that may all still be there on the servers um you know what what's going to happen with you know new emails coming through how are you going to handle all of that so so online accounts is number one on the inventory list next is digital files so these can be anything from photos to videos to documents and they can be files stored on a computer they can be
4:48 stored in a you know hard drive that to which the computer backs up they can be stored in the cloud now again there may not be any intrinsic value in the things photographs is the one photographs and videos come to mind right I mean think about it in in in you know past decades where um I I know my uh my father um at one time had all kinds of Super Eight movies that he took when my sisters and I were children that there's no value in those you know for us to sell early footage of
5:25 you know Kevin B what nobody cares right um however um my sisters and I um would get would have gotten a kick out of watching those movies and our our children I think even more so because it would give them you know a very very strong factual basis from which to you know Haze their parents right um unfortunately my my dad did not take care of those and that that asset was lost so in the digital world where we have
6:00 you know what is was it I photo for example if you're a Mac User I I assume um PC users have a similar thing right what's going to happen to all those photos um if if your heirs don't have access to them are they all going to just disappear and you're going to lose all of that or you know have you given a copy all of that to the people for whom it would be meaningful to have those copies all of those things need to be part of our estate plans same with videos okay and same with with files so
6:38 um I have files for example relating to when my grandmother died and how her funeral was taken care of you know where you know the where she's buried those kind of things um I you you know I I I presumably um I I think my sisters have this information now as I'm talking about it but I don't know for sure um and so you know all these kinds of files not to mention Financial files um are all important so will it be possible to administrate your estate without access to these files and if not how are you
7:15 going to make sure that your administrator or your executive has access um without compromising the security of those files right so there's there's a you know a two-edged two-edge there's a there's you know multiple facets to these issues that need to be dealt with okay now now next on the list here is a digital asset that actually may have value I.E digital currencies whether it's you know Bitcoin which is the best known or whether it's
7:50 DOA coin or I mean you there's thousands of digital currencies some of them have value many of them uh do not but the reality is if if your if your administrator or executive or your trustee don't have access to your digital wallet they're not going to be able to transfer those the ownership of those digital currencies okay that's that's the point of the security of of the blockchain is is that you you basically can't hack into it and no one besides
8:26 the owner um has the keys so to speak to access those assets and so you know in this case um there is a real hard asset here well not a hard asset but a real a digital asset with actual value with intrinsic value to it and and and it needs to be um dealt with in a way that it can be uh properly handled as an asset of the estate um and by the way for those of you who like me are fans of
9:02 uh The Big Bang Theory there's there's an episode um it's not someone it's nobody dies in the episode but um several years before um the the guys had mined some Bitcoin and and now it's several years later and they realize hey this this Bitcoin must be worth a lot of money and um and so they want to access it and they start pouring through going through all their old computers looking for the keys to it and it turns out that Sheldon has downloaded them all onto a thumb drive um and then he lost the
9:37 thumb drive and it turns out the fellow who owns the comic book store found it um on the floor of his comic book store and because it was like a Batman thumb drive or something like that he erases it and resells it right and of course they lost access to that Bitcoin it's it's gone forever so this is the thing with digital currencies they need to be planned for just like you know bank accounts and other other types of uh hard assets okay next domain names and websites so um excuse me to the extent that you
10:13 own a domain name and or and a website associated with it that may have intrinsic value okay now it may be only valuable to you like for example I own the the domain baml.com right I've I've owned it now for 30 years I think now there aren't a whole lot of bmels in the world I don't know that that the other bmels in the world are competing to get it so I don't think there's any intrinsic value in bmo.com on the other hand you know my my uh daughter may you
10:49 know like to have that domain uh you know when I pass away um you know if she wants to do something on the Internet with that name um and and so provision needs to be made for her to be able to take it over um and that may entail nothing more than her being able to you know sign into my control panel and then once she has access to the control panel she and and and the um and the uh domain registar um you know she can do with it whatever she wants right I'll be gone what what will
11:25 I care um but at least she'll have access to it as opposed to it being frozen and have to going through you know a big thing to get access to it okay so domain names and websites they may have they may have intrinsic value um I would imagine if you own something like I don't know camera.com right um you could probably sell that for a lot of money to you know a camera company or apple or whatever um but um it may may be more like photos and such where it's there's value to to your shes but not
12:00 any monetary value per se and then finally subscriptions and memberships so again these may not be these are not really Assets in in the strict definition of that term however um these could be in in drains on your estate financially so if you've got um you know whatever online subscriptions you may have or memberships that you know that are online um they need to be informed of um your death otherwise especially if
12:35 they're on automatic renewal they're just going to keep taking you know money off the credit card until either the credit card is shut down or you know it reaches its limit or or or whatever so um the the access to subscriptions and memberships should be part of your uh estate plan as well okay so next all right so access and security is is really the the key here in all of
13:10 these in maintaining whatever value they have okay so somewhere you you you in your estate plan you should have passwords and encryption Keys available to your your the trustee of your trust or your admin administrator or your executive so that they can have access to all of these Assets Now I would hasten to well we'll talk about this in actually I'll talk about this in the next slide um so but but somewhere this information needs to
13:45 be available um next if if there's any twoof Factor authentication so for example if you if a lot of uh you know Bank websites for example they they they want to send a text message to your phone in order to authenticate that it really is you logging in well if that's the case uh then the the your executive administrator whatever may need to have access to your phone in order to authenticate your you know the the login okay so then that's a second step there
14:22 okay I mean a phone is a hard asset right here like here's my phone right this is a hard asset probably has no value um in terms of real monetary worth but it's kind of an adjunct to digital assets because um it it it I I know for me most of my important files like many of us can be accessed both through my computer and through my phone okay so um making sure that your heirs or or the people who are going to be handling your estate have access to your phone um could be important now and and you know
14:57 do you really want them take going up to your you know I know this is sort of you know icky but you know your dead body and and like you know you know putting your your thumb print on it so that you know you you have uh you know fingerprint access to your phone I mean that's kind of weird right so so that needs to be taken into account of as well and then password managers so most of us have password managers on whatever web browsers we're using um however I know for me I'm not sure why this is the case but Google Chrome has stopped updating uh changes
15:35 to password so I have to go in and do it manually if I want my password manager to be up todate so um you know I I I if your password manager is not up to date that's not going to help very much okay but um it can be a useful tool to make sure that you can share login credentials so so that's something to um consider as well all right next okay so there's a whole range of legal matters that need to be considered
16:11 um as well and this is what I would what I um um was starting to mention and held off when I was talking about um logging into things like Bank websites and such um just because you have longin login credentials does not mean that you are authorized to log into a decedent's accounts okay so the legal authority to do so is going to come through typically either a will or a trust or a power of
16:49 attorney okay now I'm going to start with a power of attorney because if the person if if the person doesn't die but maybe they become infirmed so they're they're alive but not able to take care of their own business matters so that's where a power of attorney what's called a durable power of attorney comes into play okay we I've talked about these in in past episodes um but in the absence of a power of attorney you very well may not
17:25 have authority to access that person's account and if you do you could be committing a crime okay now will you get caught you know who knows right um I I point out the legalities because it's something you know if you have parents or you could even have children where you may end up having to take care of their business Affairs this is an issue for you to discuss with your attorney to make sure that you're doing it an a way that's not going to put you in any kind
18:01 of legal Jeopardy okay so again while the person is alive but maybe but unable to uh handle their business Affairs uh you may be able to act under a power of attorney once they die that terminates the power of attorney now you'll need to operate under the person's will and or trust okay and now if they don't have either then it's an intestate uh situation and and Court Authority will be necessary to administrate uh the
18:37 person's estate um and but in any event it will be under one of these documents or through the court that you would get the authority to for example log into bank accounts now I can tell you from personal uh experience that um even when you have the legal Authority from the court there are banks that will not accept that without going through a whole big thing vetting thing on their own okay so um you know these days Banks
19:14 can be very very difficult to deal with in fact I was talking to my banker uh two three weeks ago and and mentioned something about this to him and when your Banker tells you that banks are difficult to deal with you know that Banks s are difficult to deal with right he's in the business right and that's what he's telling me and he was commiserating with me and it wasn't it wasn't the kind of thing where you know he was he he wasn't being difficult it's just the the whole banking system is can be very very difficult to navigate even for Bankers okay and and so some banks
19:50 you know air on the cautious cautious super cautious side right so that's why when we talk about these legal matters it's best to plan in advance if you can okay because the more the more you plan in advance the more certainty you can have when it comes time for you to have to exercise whatever Authority it is now there are some state laws and and by the way federal laws that can come into play with respect to these and this is why you I I highly recommend you speak to
20:25 your lawyer about this because they're the ones who can help you navigate whatever set of laws regulations Etc you may need to navigate now the last legal matter are terms of service so this would apply for example to social media sites so um I mentioned this already I did a show about managing the social media accounts of uh of a decedent each social media platform whether it's Facebook LinkedIn X I think those were
21:00 the three that I I used as examples they have terms of service agreements under which we use their their social media site and those terms of service explain sort of the rights and responsibilities that a relative or an administrator has with respect to the social media of someone who has died okay and that will govern how they handle things so in the case of terms of service for any particular social media
21:36 site you can just you know Google you know Facebook deceased member terms of service right and it'll take you right to it and you can read what it says um or you can go watch the the show I did on that before um but it's not just social media that have online terms of service any online access will have terms of service that describe the rights and responsibilities of the the service and of the people who use it okay and so these will be as
22:11 important as state and federal laws and regulations and in some cases may be more important because although the terms of service may be less strict than state law regulation or federal law regulation in which case the law and regulation is going to govern often times they may be more strict and so it doesn't matter what the what the law or well it's not that it doesn't matter it's just that even though you've complied with the law or regulations there may be other things you'll need to do in order to comply with the with the
22:46 organization's terms of agreement so it's better to know those upfront okay next okay um and um yeah disposition okay so disposition is what is going to happen to these various digital assets um a a you know after the estate closes okay now first of all you you want to designate beneficiaries okay now I I this this
23:23 comes into play whether or not the assets have intrinsic value so we I talked about photographs and videos so if you if you haven't already you know given them to your relatives you may want to um either do so right away especially if they're digital it doesn't matter it doesn't take anything away from you for others to have copies of it minimally you want to make sure that you designate a beneficiary um and and there's things to consider I.E are there C you know do you want anyone who wants
24:00 or any member of your family and friends who wants copies of them to have them in which case the designated beneficiary for those uh photos and videos should be someone who's going to be willing to do that on the other hand you only want certain people to have it and in which case you know the designated beneficiary should be someone who will abide by your wishes okay now when it comes to something like digital currencies that have an actual value to them right how who's G to who's going to get those right and in theory anyone who has access to your wallet has the ability to
24:36 take those assets so if you're intent on giving them to just one of your heirs then they're the only ones who should get um those credentials or or they and your administrator should be the only one to get those credentials especially if there's a chance one of the other errs might feel slighted okay so then and uh you know if they got a hold of the credentials they might take the money once the money's gone out of the wallet it's it's it's virtually unrecoverable okay so so designate
25:11 beneficiaries second social media accounts what do you want done with your social media accounts you know most of the social media sites will allow the the account to sort of be Frozen as sort of a memorial for the person they'll also allow it to be taken down so what do you want to have happen in in sort of your you know social media Legacy okay and it should be specified other or if you don't care you can just say I leave it up to my administrator or um you know these people should make a decision about my social media accounts okay and
25:46 that's true of your sort of Greater online presence so if you maybe you have a personal website maybe you have a Blog okay so those need to you know the just like with your so social media accounts although the social media companies have their policies for your online presence what do you want to have happen do you want your blog maintained right and recognize that it probably can't be maintained for free there may be uh you know fees for the domain regist to keep the domain registration up there may be
26:21 fees for you know to keep up the um um you know the the the the server Etc that it's on on right and so if so how is that going to be provided for and who are you going to designate to be the sort of curator of your online presence these are all significant issues that you should think about and deal with as part of your estate plan okay and then finally instructions for Access so how does someone access your uh control panel how does someone access your domain registration right that should be
26:58 specify you could say well that's part of access and security well that's true that's true um you know doesn't hurt to you know overemphasize um this because in the end with all of these digital assets access is the key proper legal access right as we talked about um in in the previous slide okay so oh good we're doing okay on time okay finally and and this is um if you
27:34 if you have a separate professional Andor business accounts okay so these may need to be dealt with differently than your personal uh accounts okay let's take professional first so let's say you're a lawyer and you have a law corporation well if you have a website presumably your website is owned by your law corporation okay as are the profiles that you may have say on LinkedIn or whatever okay so if that's the
28:12 case when you die depending on what happens with the ownership of that law corporation that will to a large that may to a large extent govern what happens to the website Prof files Etc okay so in this case there may need to be a separate part of your estate plan directing your professional or business colleagues as to what to do about these things so I had a a colleague who was a lawyer um
28:47 this was back before I joined the Navy we we used to do a lot of business together when I got out of the Navy and got back into business I contacted him and never heard back I eventually uh called The Firm and was told he had passed away but if you went on the the the firm's website his profile was still there it said nothing about him being deceased okay which I mean I much I don't know if that was a a you know choice they made or if it was just that was kind of the default because there there's there was no policy in place for
29:22 what happened when a partner of the firm passed away I I I really don't know I wasn't going to start you know getting into that with you know the woman I was speaking to but I think these are you know part of our professional responsibilities also entails that in our estate planning we deal with these kinds of issues and indeed we may need to appoint someone at the firm or in our business who will then have the responsibility for carrying out whatever our wishes are in that respect okay
29:58 and and in the case of the firm let's say you have access to online to the firm's you know bank accounts well so they're the firm's bank account so they shouldn't be you know swept assuming your your company is a separate entity it's an LLC or a corporation or something it shouldn't necessarily get um pulled into probate your interest in it may get pulled into probate but not the entire firm firm and so in that case um it it you know there should be a
30:33 provision there that other members of The Firm will have access to whatever accounts the a The Firm has in order that the business can continue on as smoothly as possible and again from my own experience as someone who has dealt with this not not my own firm but but deals with this as a professional I can tell you it can be an absolute nightmare if there aren't Provisions for cont uity for access to digital assets of a profession or a or a business and it can make continuity of the business
31:08 extremely difficult um and cause a lot of Heartache um to the clientele of the business so this is an extraordinarily important aspect of your estate plan or really your should be in your business continuity plan um to deal with but but you know dealt with probably in in coordination with your estate plan okay so that is um digital asset estate planning here we've got our our our legal stuff you know just just in case okay
31:43 and oh I think I missed oh oh yeah I for some reason it skipped over this so if you have any questions comments the links to social media as well as my email address will be in the show notes after the show posts feel free to reach out to me as always just with the caveat if you ask me a question that's outside of my purview something of a legal nature or of an accounting nature okay I'll be happy to refer you to the appropriate professional um but I don't I don't answer questions outside of my scope of expertise as I hope you would
32:19 would expect that I would not um but I'm happy to help you find someone who can help can give you the answer to your question very happy to do that if it's of a private nature please do send it either by email or through direct messaging um otherwise if it's a general interest question feel free to post it in the comments okay and here's our legal stuff so we'll close out the the uh the presentation so I thank you very much for joining me this morning a nice way to to kick off the week here uh with a a a somewhat interesting and and very
32:55 important topic in aate State planning and administration so tomorrow at 10:00 a.m. Pacific time is my show business lessons from the military and my topic is Frozen by philosophy and I'm going to be talking about a a situation where a war was almost lost because the military philosophy of one of the countries was such that the the Armed Forces could not effectively
33:32 respond to the military threat so it's it's a it's a a history lesson turned into a business lesson I invite you to join me tomorrow 10: am at Pacific time for business lessons from the military and then on Wednesday also at 10: am my show people making money I'm going to be talking about taxes effect on you you and the economy this is going beyond the fact that we you know have to pay Uncle Sam our taxes um every April 15 The Ides of April um taxes affect us in
34:10 in in many many ways and this is not a political discussion this is an economic discussion of how taxes affect our lives so we can understand it better and make better decisions so I invite you to enjoy to join me at 10 o'clock p.m. uh 10 o'clock AM Pacific Time on Wednesday for people making money and then a week from today I'll be back for the next edition of trusts and Estates weekly so once again thank you very much for joining me wishing you a wonderful rest of the day and signing off Marie you are
34:48 my bell courage at all times my friends