Lost in the cloud: What happens to your digital assets when you die?

Even the Luddites among us have lives online: bank statements and power bills delivered by email, passwords, social media accounts, digital photographs, video game assets and maybe even some cryptocurrency.

There’s more to your digital life than you probably realize, said Gerry W. Beyer, a law professor and a leading U.S. expert on estate planning who teaches at the Texas Tech University School of Law in Lubbock. Your assets include all the passwords that unlock your digital world. If you don’t plan how to pass that on before you die, it’s going to pass along with you. You have to know what online accounts you have, including social media, email, finances, subscriptions and digital files.

In addition to teaching others about estate planning, Beyer has written several articles and books on the topic, including “Estate Planning for Cyber Property.” That guide to help estate planning professionals, written with Kerri G. Nipp, includes a breakdown of digital possessions that shows just how much someone might have and how diverse those assets could be. Their list includes items stored on technology like computers and smartphones and in the cloud: digital photos, personal and professional blogs, videos, emails, texts, documents, music playlists, medical records, tax documents, home security recordings and avatars, among other things.

Have you thought about what should happen to your YouTube and other videos stored somewhere in cyberspace? Or who should be able to access virtual currencies and online banking and investment accounts or your eBay shop? How will others pay your bills online, either permanently or for a short time because you’re temporarily indisposed? Who’s going to cancel the automatic payment for the food delivery subscription when you’re no longer cooking dinner?

Some people keep client records, patient records, inventory, customer databases and more in cyberspace. Even domain names or blogs can be valuable, but Beyer and Nipp note they require a password to access or renew.

And wouldn’t it be a shame to let those airline and credit card points expire when you know your daughter would love to use them?

There are also tangible assets in digital form, including cryptocurrency, non-fungible tokens (NFTs), assets collected in online games and Metaverse assets that bring an immersive experience to life, for example, per Beyer.

But Americans are notably bad at planning for what happens when they die or are disabled.

While fewer than a third of U.S. adults had a will in 2024, according to the Wills and Estate Planning Study from Caring.com, it’s likely that fewer still have planned for their digital assets. And many might not even realize they have them, Beyer told the Deseret News.

He believes failure to do that planning is more than a missed opportunity. It’s the beginning of a nightmare for loved ones and increases the likelihood that things that really matter could be lost in the cloud.

Start with what’s easy

First, of course, you have to know what you have. Do a digital inventory and be thorough.

Then start with what’s easy. That’s Beyer’s advice. Super easy means adjusting your setting on Facebook and Google and Apple and other social media or virtual platforms that let you designate someone who can access what’s there should something happen to you. You can set that up yourself without outside help.

If something happens to you and you took that step, a loved one can easily have the access you wanted to give them. If you didn’t preplan and take care of it, getting access could require a court order, lots of time and is possibly not doable.

Electronic communications planning is next. Do you want someone to be able to get into your email and find your Visa bill, the bank account statements and all those bits and pieces that come to your inbox? It would help them pay creditors, notify family members and probably transfer assets.

One of the key distinctions is planning between electronic communications and ones that aren’t: “That’s where you see a lot of rule differences,” said Beyer, who lists emails, text messages and private posts on social media accounts as examples. You have to decide if you’re going to give someone access to what the messages say or just the catalog, such as who the messages are from and to and the dates, but not the substance.

Sometimes people would rather keep loved ones out of private emails, documents or other electronic material “because they may contain hurtful secrets, non-politically correct jokes and stories, or personal rantings,” per Beyer and Nipp.

Figuring out access is not just about death, either. Will someone be able to get into your accounts to pay your bills if you become disabled short or long term? Skip your mortgage payment or phone bill for a month and see what happens.

Beyer said to consider what to do with your personal email from two perspectives: Put it in your durable power of attorney in case you become disabled, stating whether someone can access contents. And put it in your will in case you die.

The email trap

If you’re always in your work email and figure that’s the best place to have your statements, receipts and correspondence sent so you don’t miss anything, reconsider. Your work email account probably isn’t actually yours, so the likelihood you can legitimately share the password or grant someone else access if something happens to you is slim to nonexistent. Most companies shut off access about 11 seconds after learning you died and they’re even faster to cut you off if you’re let go.

Beyer said he has seen that happen to the students he teaches, too. “They get their email for a certain length of time after they graduate, then it’s all gone.”

Perhaps worse, your email will probably be forwarded to someone else — perhaps your boss or that colleague that was always competing with you for a promotion. If you leave a company, that doesn’t mean the company lets go of your role or work product. What arrives in that inbox could have a broader audience than you thought. And lots of times, companies monitor email, as well.

The work-around to losing access might be making backup copies. That requires both planning and ensuring that your work email agreement allows that.

Call in a pro

Digital estate planning involves paperwork, just like estate planning for tangible assets. Beyer suggests people need a power of attorney for property management, a financial power of attorney and a will or trust to control who will have access to assets and communications, including emails and texts. Appropriate plans are sorely needed for those who have cryptocurrency or NFTs.

Getting a professional to help can ensure wishes are clear and enforceable, Beyer said.

Laws in different states vary, so he recommends finding a lawyer who does a lot of estate planning. “If you’re not legally trained, you may not appreciate some of the things you do that won’t have the result that you want,” he said. “A document that could be 100% valid in one state might be worthless in another.”

Beyer admits it’s a pain on lots of fronts. No one wants to think about death. No one wants to shell out money if they think they can do something themselves. “It’s a very stressful thing, but afterwards the difference of how easy or hard it’ll be on your family is incredible.”

Not planning impacts both physical and virtual treasures. He worked on a case where the parents had been dead many years and the adult child lived in the house and paid the bills and taxes, but didn’t do the paperwork to transfer the title. When the house needed major repairs, the heir couldn’t prove home ownership and things stalled. “It took almost a year for us to do all the legal proceedings and all the stuff needed to get the property transferred, whereas a simple will would have solved all the problems. It’s very common. It’s a real hassle and a lot of people don’t take the necessary steps to either plan or take care of it after somebody passes,” he said.

Assets like bank accounts where you can name a beneficiary don’t have to be in your will. But to pass the other things on, you probably want to list them and provide directions so that someone can actually get the information needed to access them. Back when everyone got paper bank statements and bills, a person could watch the mail for a month and know what was out there. That’s no longer true. Most people get those updates by email, which you have to be able to get into.

Paradise lost

With cryptocurrency and NFTs, you need pass phrases and seed phrases and passwords. Forget those and what was owned disappears. Unless they’re on an exchange, there’s no way to get the password back, Beyer said.

“People have lost umpteen millions of dollars because they don’t have any way of getting the password. You have to plan for that or the assets just disappear,” he said.

For example, in December, Medium reported that about 13% of all Bitcoin has been “lost due to forgotten private keys, hardware failures and irreversible mistakes. This isn’t just a quirky footnote in Bitcoin’s history; it’s a dynamic factor that could reshape its value and role in the financial world.”

The question is, how do you control the assets yourself while ensuring they’ll be safely transferred to someone you designate should something happen to you? Safely is the key word, because things can go awry between people, especially when something with monetary value is involved.

There are lots of hypothetical situations that for some people come true. It’s hard to over-imagine the possibilities.

Say you tell your husband your password and the seed phrase for your cryptocurrency, then you divorce and he snags it. What then? Or you die and your daughter knows information to access the crypto, but you actually wanted to leave it to your niece and did so in your will. Your daughter could say she forgot the password. Yikes. Then again, if you tell your niece the password so she can get it, maybe she’ll do so prematurely.

What you never want to do is put pass phrases, seed phrases and passwords in the will, where who sees it is out of your control. Wills, once probated, can be viewed.

Most people don’t have millions in crypto. But without planning, your photos and poetry and that music library you built over decades could disappear, too.

Startups tackling gaps

Even if you do everything you can to secure and pass on your digital treasure, things can go wrong. But the risk is smaller than if you did nothing.

What happens if your executor is lousy? “Then everything is bad,” Beyer said.

Companies are tackling some of those problems, storing names and passwords securely, with the promise that upon your death they will distribute the Bitcoin or whatever to those you designate. Beyer said a lot of them are startups with great ideas, but he added it’s hard to say whether or not they will have longevity.

He likens it to when stocks and bonds first became a thing and transferring shares and sorting out percentages of ownership and distributing profit was new. “Historically, that was very, very difficult. Now it’s easy and we don’t hold the stock certificates any more, right? A broker has them, but they are all regulated and insured and the system has evolved over the last 150-200 years, while we’re just in the very beginnings of dealing with digital things.”

The exchanges are based on the blueprint created for stocks and bonds, but for now at least, they’re not insured. “It’s all sort of still a Wild West sort of thing,” said Beyer.

Still, there are other tips to help the process of giving your digital assets their own afterlife. Among the tips from Beyer and Nipp:

• Make tangible media backups. Put important digital materials on a thumb drive or copy them to a CD or DVD, for example.
• Take inventory of assets, including account details, usernames, passwords and instructions for handling the accounts in case of disability or death. “Store this inventory carefully, considering options like a trusted person, encryption, a safety deposit box or an online password storage service,” they said. Beyer and his wife use a safety deposit box their heirs will be able to access later. And they update it at least once a year.
• Consider storing photos and videos on a website that multiple family members or friends can access immediately. Why not share them now?
• Wills should state whether the fiduciary has access to digital assets.
• Consider putting digital assets in a revocable trust, “which may not become part of the public record and is easier to amend than a will.” You really don’t want to redo your paperwork with every password change.
• There are online afterlife companies that can help plan for digital assets.
• There are also businesses that will manage your passwords securely so you only have to keep track of one. But guard that one carefully.

The good news now, per Beyer, is that most estate planners now know a lot about dealing with digital assets because they’re so common. A decade ago, you needed a specialist. That’s no longer true.