Digital Transformation in Estate Planning

How digital tools and assets are reshaping trust and estate work, and how responsible planning must keep pace

In my more than four decades of handling trust, estate, and probate litigation, I have seen the tools of the field evolve, from handwritten wills filled with ink blots and testamentary clauses, to electronic signatures and laser-printed trust kits. Yet the transformation now underway promises nothing less than a paradigm shift. It changes not only how estate plans are drafted or stored, but also what they must cover and how they must function in a world of digital assets and digital behaviors.

A recent survey by TD Wealth reveals that 69 percent of estate and financial planners now incorporate digital tools into clients’ estate plans. At first glance that statistic may seem modest, but it represents a watershed moment. It signals that the traditional model of an estate plan dominated by physical assets such as real estate, business interests, and bank accounts is giving way to a more complex ecosystem. Today’s plans must include digital content, passwords, social-media presences, and even cryptocurrency.

In this article I consider what this reality means for practitioners, trustees, executors, beneficiaries, and most importantly, for the individuals and families who rely on these plans to preserve their legacy, avoid conflict, and protect loved ones.

The New Frontier: Digital Tools and Assets in Estate Planning

The TD Wealth survey found that among the digital content now incorporated into estate plans, the highest proportion involved blogs, social media, and email accounts (71 percent), followed by passwords (67 percent). At the same time, 61 percent of planners identified cryptocurrency and other digital assets as part of client portfolios.

This shift is meaningful because digital assets differ from traditional assets in three important ways:

Intangibility. A social-media profile or email account may have no formal title or certificate of ownership, yet it can hold immense personal or business value.
Access risk. Without secure management of passwords, credentials, or digital asset wallets, these assets may vanish or become permanently inaccessible.
Rapid evolution. The legal, tax, and regulatory landscape for digital assets is still maturing, meaning older plans that ignore them may expose families to risk.

In short, an estate plan drafted a decade ago that assumes the only assets are a house, bank accounts, and a life insurance policy is incomplete. It may miss crucial holdings or leave heirs stranded.

At Hackard Law, we increasingly see beneficiaries and heirs frustrated when an estate plan fails to account for a person’s digital footprint or when a fiduciary fails to act on that footprint. Social media accounts contain family memories, photos, and business correspondence. Digital asset wallets may hold cryptocurrency or non-fungible tokens. These items are not simply optional details; they are often central to a person’s identity and to the value of an estate.

What the Statistics Tell Us and What They Miss

With 83 percent of estate planning professionals now using digital tools such as planning software (52 percent) and online platforms (48 percent), this technological shift is well underway.

This digital infrastructure offers clear benefits. Software helps track holdings, platforms enable client collaboration, and remote access streamlines updates. For clients, this means faster revisions, simpler updates to beneficiary forms, and better documentation of digital assets. Yet software is only as effective as the process behind it. It does not guarantee that the right questions are being asked.

In litigation, I have encountered precarious situations. A decedent leaves a large cryptocurrency holding, but neither the executor nor heirs know it exists. The wallet is encrypted and the keys are lost. The estate stalls. Another client leaves behind an online business that generates income, but the plan never identifies who will manage or transfer control. These are not clerical oversights; they are structural failures.

The survey also found that the leading cause of family conflict is beneficiary designation. In 2022, 34 percent of professionals cited it as the main source of disputes, up from 17 percent in 2021 and 14 percent in 2020. As estates grow more complex, mixing traditional and digital assets across blended families and multiple jurisdictions, misunderstandings multiply. A mis-designated beneficiary on a retirement account can clash with a digital asset trust, and online income sources may be forgotten altogether.

This transformation is not about simply adding “digital assets” to a checklist. It compels us to ask sharper questions. Who owns each digital asset? Who controls it after death? What happens to online reputations, business operations, or passwords? What remains unaddressed because the planner assumed a traditional estate structure?

The Fiduciary’s Challenge: Document Management and Complexity

Another finding from the survey highlights the ongoing difficulty of maintaining current estate documents. The most difficult items to keep updated were powers of attorney (31 percent), current wills (29 percent), and guardian or beneficiary designations (20 percent). Market volatility also ranked as the number one threat to estate planning in 2022 at 31 percent.

Market volatility affects asset values, the timing of distributions, tax planning, and business succession. If an estate plan cannot adapt, it risks failing its purpose. Document management breakdowns mean even the best-drafted trusts or wills can become outdated or overlooked. A stale power of attorney might prevent a trusted agent from acting when a crisis occurs. When plans fall behind, digital assets or new accounts are often forgotten, and older versions of wills or trusts may no longer reflect the client’s true intent.

In practice, I have seen children unintentionally excluded, assets unaccounted for, and digital records lost forever. These are everyday risks. With digital tools now part of nearly every plan, keeping documents current is critical.

Families must ask important questions. Have all digital assets and access points been properly inventoried? Are passwords kept in a secure and recoverable way? Do beneficiary designations match across accounts and policies? Is every cryptocurrency wallet accounted for and safely managed? And have online businesses, websites, and other income sources been fully included in the estate plan?

A Modern Estate Planning Framework

The following principles form a modern framework for estate planning. They are grounded in decades of litigation experience at Hackard Law and are designed to prevent the most common sources of dispute.

1. Perform a complete asset audit, including digital assets.
Record not only real estate, business interests, and life insurance, but also:

Email and social-media accounts
Cryptocurrencies, tokens, and NFTs
Domain names, websites, and online income sources
Passwords, encryption keys, and cloud storage

Each asset must include clear access instructions and transfer or closure plans.

2. Inventory all digital credentials.
Clients often believe they have their passwords organized, only for heirs to find otherwise. Establish secure password vaults, multi-factor authentication, and successor digital agents. Include written instructions in the estate file.

3. Align all beneficiary designations with the estate plan.
Beneficiary designations override wills and trusts. Ensure that life insurance, retirement accounts, and pay-on-death designations support, not contradict, your estate plan. Include digital income streams in this review.

4. Create a digital asset trust or clause.
Include specific powers for a digital asset fiduciary, instructions for content management, and protocols for encryption keys and crypto wallets.

5. Review and update regularly.
Technology and family circumstances change quickly. Plans should be reviewed at least once a year or whenever major life events occur.

6. Communicate openly with family members.
The TD Wealth survey shows that 84 percent of planners encourage family discussions, but only 15 percent of clients follow through. Families should understand what exists, who has access, and how digital assets will be managed. Openness prevents confusion and conflict.

7. Work with professionals who understand digital risks.
Digital assets come with regulatory uncertainty and unique access challenges. Choose advisors who are experienced in both estate law and digital technology.

Why This Matters for Families and Heirs

A will, a trust, and a power of attorney are essential, but without digital integration they are incomplete. The cost of neglect can be high. Executors may face delays searching for access credentials. Assets may lose value or disappear. Beneficiaries may feel excluded or suspicious, fueling disputes. Fiduciaries who mishandle digital assets risk liability for losses, breaches, or failures to disclose.

At Hackard Law, representing beneficiaries across California—from Sacramento to the San Francisco Bay Area and Los Angeles—we see how proactive digital planning reduces conflict. Families who take time to plan for digital assets protect both value and peace of mind.

The Bigger Picture: What This Shift Means for the Industry

This digital evolution in estate planning also has broader implications.

Regulation and taxation. Governments are recognizing cryptocurrency, online businesses, and digital property rights. Estate plans must anticipate new reporting requirements.

Education gaps. Many trustees are skilled with traditional assets but inexperienced with digital holdings. Nearly one in five planners still avoid digital tools entirely, which may expose clients to risk.

Traceability. Digital assets can vanish if not documented. Lost passwords or expired domains can erase wealth and family history.

Complex family structures. Blended families and multi-jurisdictional lives add legal layers. When combined with digital holdings, these factors heighten potential for conflict.

Litigation risk. Disputes over digital access, online business control, and crypto ownership are rising. Clear planning and documentation are the best defense.

Guidance for Professionals

Attorneys and fiduciaries should take immediate steps to modernize their practices:

Provide staff training on digital assets and credentials.
Update intake forms to include questions about cryptocurrency, online content, and password storage.
Add digital asset clauses to standard documents.
Define fiduciary responsibilities for online businesses and digital income.
Maintain secure, regularly updated credential records.
Encourage family meetings to explain the plan.
Review and refresh documents annually.
Prioritize conflict prevention through transparency and documentation.

A Closing Reflection

When I began practicing law in the 1970s, estate planning focused on farms, small businesses, and handwritten wills. Today, we still protect those same tangible assets, but we also safeguard Bitcoin wallets, digital art, influencer accounts, and online intellectual property. The goal remains the same: to protect loved ones, preserve value, and maintain peace within families. The tools have changed, and so must we.

The TD Wealth survey shows that most estate planners are adapting, yet adaptation is only the beginning. We must lead, anticipate, and educate. For beneficiaries and heirs, the right question is no longer only, “Do I have a will?” It is, “Does my plan protect my digital life?”

For attorneys and trustees, the mandate is clear. Integrate digital strategy into every estate plan. Map all assets, document access paths, align beneficiaries, and communicate openly. By doing so, we preserve both assets and trust, the foundation of every successful estate plan.

At Hackard Law, based in Sacramento and serving clients throughout California, including the Bay Area and Southern California communities, we believe that any plan that ignores digital assets is incomplete. Work with professionals who understand both the legal fundamentals and the digital frontier, because your legacy deserves nothing less.

If you are a beneficiary or heir who suspects an estate plan may have overlooked digital assets, or if you are a fiduciary uncertain about secure access, now is the time to act.

For further reading, visit “Estate Planning for Digital Assets: Protect Your Legacy” at https://www.hackardlaw.com/news/estate-planning-for-digital-assets-protect-your-legacy/.

For questions or to arrange a consultation, visit Hackard Law’s Contact Us page at https://www.hackardlaw.com/contact-us/ or call 916-313-3030.

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