Every year brings new technology to make our lives easier and more efficient, but as we all sign up for electronic billing, social media accounts, and financial planning apps, it makes estate planning in Canada more complex.
If you or a loved one were to pass away suddenly, consider these questions:
- Does anyone have your social media passwords?
- Does your significant other know all of the apps and accounts you use for online banking, investing, taxes, and budgeting?
- Does anyone have access to your subscription services like Netflix, Spotify, or Disney+?
- Is there a record of any cryptocurrency you may own, like Bitcoin?
- Do you own an eCommerce store like Etsy or Shopify? Does anyone have access and is there a succession plan for managing it?
Some people are beginning to plan ahead by using password storage solutions such as Passpack, but many Canadians are still not even considering the fact that their Executor could be locked out of very pivotal accounts with essential information.
Digital Estate Planning in Canada
The best way to avoid a digital disaster is by preparing your estate as much as possible.
When you’re making your estate plan or updating your will, take the following three steps to make sure your digital assets are properly included.
1. Make a Plan for Social Media
Among the most neglected assets that Canadians forget to include in their estate plans are their social media accounts.
You may ask, so what? But social media has quickly become a digital representation of ourselves, an online record of our lives containing our favourite photos, videos, and other memories.
The platforms do typically have a process for deceased accounts. Facebook for example has a feature where you can assign a friend or family member to become the “legacy contact” of your social media account. This enables the approved user to gain full access to your account in case of death or a debilitating accident.
Naming your successor and including your passwords in your estate plan will facilitate a smooth transition of ownership so the account can be either deleted or become a memoriam Facebook page.
Ask these three questions about your social media accounts when adding them to your plan:
- Should the account be deleted?
- Will the account be maintained? (i.e. is it a joint account with your significant other?)
- Do you have any other social media accounts besides personal?
- Would anyone want the account to become a memorial page?
- Are there pictures and photos you would hate to lose on your social media accounts?
- Are any of your social media accounts monetized? (i.e. YouTube)
2. Make a List of ALL Digital Assets
It’s not news to anyone that Canadians live much of their lives in digital environments. In fact, over 80% of Canadians have used at least one online tool or service that incorporates their personal finances.
This cannot be ignored while planning estates.
The surge in boomers who have a presence online has created millions of intangible digital assets.Estate Planning In the 21st Century: New Considerations In A Changing Society, BMO Wealth Management
It’s very important to keep track of each service used to process personal and financial data. These assets are no less important than physical ones just because they exist online.
It’s a good policy to treat these accounts or tools as assets that can be passed on to next-of-kin or settled upon death or accident.
Here are some of the most common digital assets you need to consider:
- Paypal accounts
- Social media accounts
- Entertainment accounts (Netflix, iTunes, Spotify)
- Photo storage or sharing devices
- Personal websites
- Professional websites or eCommerce stores
- Online banking accounts, including investments
- Email accounts
- Financial planning or estate planning apps
- Online accounts for service providers (i.e. Rogers, TekSavvy, etc.)
- Gaming accounts
Create a list of all of your digital assets and the login credentials necessary to access them.
Either store this list in a safe physical file or in a secure password manager that your executor or next-of-kin can access. Here are some password managers we recommend you look into purchasing:
You should also include an inheritance or succession plan to determine what will be done with your digital assets upon death or accident.
This is especially important if any of the assets are business related. We recommend you seek professional help as an executor when dealing with the succession plan for substantial digital assets.
3. Prepare Your Cryptocurrency
Cryptocurrencies have become prominent in mainstream media due to BitCoin recently reaching upwards of $10,000 USD for a single unit.
While the market has been under speculation and criticism from professional economists, a growing number of Canadians own some amount of cryptocurrency.
Cryptocurrency ownership will only become more popular as time progresses, however, the problem lies in that they are intangible and often stored on third-party devices like USB sticks or personal computers. This makes them easy to be overlooked, despite their value.
The solution? Keep track of your cryptocurrency value and location at all times. Creating or curating a written template that accommodates cryptocurrency is the easiest way to ensure that your estate is prepared for the future.
Cryptocurrencies like Bitcoin, Ethereum, XRP, Litecoin, Tether, and EOS should be treated as legitimate financial assets and therefore included in every estate plan with care.
Free Estate Planning Resources
Trying to prepare your own estate?
Updating your will to include new assets and individuals?
Learning more about your executor duties?
If you’re looking for more help with estate planning, feel free to make use of our free estate planning resources:
- Official Executor Guide for Canadians
- How to Prepare Your Estate for Your Executor
- Will Preparation Guide
- Inheritance Planning Guide
- How to Choose an Executor
- Executor Duties in Canada
- I’m an Executor – what do I do now?
- Can you include pets in your will?
- What happens to an estate without a will?
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