Estate planning and your digital assets

You probably already know how important it is to have a plan for your physical and monetary assets. These key items are routinely included in wills and are designated a power of attorney.

However, as more and more of our information moves online, it's important to have a plan for your digital assets as well. From financial assets like bitcoin to mementos like family photos, if you don't create a plan for what should happen to these assets after your death, your family will have a very hard time, and in some cases they will not be able to gain access to them at all. Ensure your family has access to everything they need with these four steps.

Step one: Define your digital assets

Digital assets cover almost everything we do online, from social media to online banking. Everything that requires a password for access probably qualifies as a digital asset. They include online documents, photos, videos, audio recordings, financial records, cryptocurrencies and almost anything else of value that is stored on a computer, laptop, tablet, hard drive, or cloud storage device. Make a list of all online accounts, especially those for banking, insurance, credit cards, savings, transaction platforms like PayPal and Venmo, social media, email, Dropbox, and anything else that holds assets you would like saved or passed on. Now, make a list of all their accompanying usernames and passwords.

Step two: Formalize your plan in writing

When it comes to social media sites, you'll have to decide if you want them shut down or maintained. Some people keep Facebook accounts open to serve as a memorial so people can comment and share photos and memories of the deceased. Facebook allows users to name a "legacy contact" to take control of their account in the event of their death. This person can post an obituary on your timeline and archive posts and photos. Similarly, Google has an "inactive account manager" option, which allows you to share data and contacts with another person. Other sites have similar features, but all require you to activate them ahead of time.

Attach your plan for your social media sites to a printed copy of your username and password list. Store these documents in a safe, a safety deposit box, with a trusted relative or with your estate attorney.

Next, name a digital executor in your will. This should be someone you trust to go through your online accounts and specify what happens to your assets according to your instructions. Be sure to include whether you would like your accounts shut down or kept open.

Finally, assess the value of digital assets like bitcoin and provide instructions for how you would like them distributed to family members. Include access to your personal key, and make sure your power of attorney has agency to allow access to your cryptocurrency.

Step three: Provide easy access to your beneficiaries

Assign a beneficiary to receive the access to your list of usernames and passwords and make sure they have easy access to it, as well as answers to security questions and other online safety provisions. If you have online investments, talk with your estate planning attorney to make sure they are incorporated into your asset distribution.

Step four: Work with an estate attorney

Digital assets, especially when they include online investments, can be complicated to disburse. Work with an experienced estate attorney to make sure you're leaving your family with access to both financial and sentimental assets. Routinely update your estate plan with the most up-to-date information on your digital assets to ensure that the executor of your will have the most access.

• Michael J. Anselmo is an attorney at Anselmo Lindberg and Associates in Naperville. The full-service law firm provides specialized legal expertise in areas of default, real estate, business and corporate services, estate planning, and general civil litigation.