Estate Planning For Digital Assets Under New Jersey Law

As our personal and financial lives increasingly move online, estate planning must evolve to address a new category of property: digital assets. From email accounts and social media profiles to cryptocurrency and cloud-stored business records, these assets often carry both financial and sentimental value. Yet, without proper planning, they can become inaccessible—or even lost—upon incapacity or death.

If you haven’t updated your estate planning documents in the last decade, they likely don’t address digital assets.

For New Jersey residents, the legal framework governing access to digital assets is shaped by the state’s adoption of the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA). Understanding how this law operates—and how to plan effectively around it—is essential to ensuring your digital legacy is properly managed.

What Are Digital Assets?

Under modern estate planning law, a “digital asset” broadly includes any electronic record in which an individual has a right or interest. This can include:

• Email accounts and communications
• Social media profiles
• Online banking and financial accounts
• Cryptocurrency and digital wallets
• Cloud storage (photos, documents, intellectual property)
• Subscription and loyalty program accounts

The Importance of Digital Asset Planning

Failing to account for digital property can create legal, financial, and emotional complications for both loved ones and fiduciaries. Many digital assets are protected by layers of encryption and password protection. Unlike traditional bank accounts, there is often no centralized recovery mechanism if access credentials are lost. This is especially critical for:

• Cryptocurrency wallets
• Online-only financial accounts
• Domain names or monetized digital content

Even when a fiduciary is properly appointed, accessing digital assets is not straightforward. Custodians (such as email or social media companies) are legally bound to protect user privacy and may therefore refuse access without explicit user consent. Accordingly, custodians often require formal legal documentation or a court order, which can lead to delays in estate administration, increased legal fees, and frustration for executors trying to fulfill their duties.

Access to business-related digital holdings is particularly critical. Key assets may include: client records stored in cloud platforms; business email accounts; intellectual property or proprietary data; and revenue-generating websites or online storefronts. If no one can access these systems, operations can be significantly impacted. A well-structured estate plan can ensure continuity by granting authorized individuals timely access to essential digital tools and information.

Finally, not all digital assets are financial. Many hold immense emotional value, such as family photos stored in the cloud, videos and personal recordings, and social media accounts documenting years of life events. Without a plan in place, families may be unable to access and preserve meaningful content.

New Jersey’s Revised Uniform Fiduciary Access to Digital Assets Act

New Jersey enacted its version of the RUFADAA in 2017. The law grants fiduciaries—executors, trustees, and agents—legal authority to manage a decedent’s or principal’s digital assets, including email, social media, and online financial accounts.

RUFADAA establishes a three-tiered system to determine fiduciary authority:

• Online Tools: If a platform (e.g., Google or Facebook) provides a tool allowing users to designate access after death, that direction controls, even over a will or trust.
• Estate Planning Documents: If no online tool is used, the user’s will, trust, or power of attorney governs.
• Terms of Service Agreements (TOSAs): If neither of the above applies, the service provider’s terms of service will dictate access, often restricting it.

How to Establish a Digital Estate Plan

Being proactive ensures that digital assets remain accessible to loved ones while protecting privacy and security. Below are some key considerations and practical tips for establishing a digital estate plan:

• Explicit Authorization Is Critical: Without clear authorization in your estate planning documents, fiduciaries may face significant legal barriers when attempting to access digital assets. Even knowing an account exists does not guarantee access. It is imperative to include specific language in your will, trust, or power of attorney that grants authority over digital assets.
• Use Online Tools Where Available: Many platforms allow users to designate a legacy contact or set instructions for account management after death. Because these tools override conflicting estate documents under RUFADAA, they should be coordinated carefully with your overall plan.
• Inventory Your Digital Assets: A comprehensive digital asset inventory should include: account names and platforms; nature of the asset (financial, personal, business); and access instructions. For high-value assets such as cryptocurrency, private keys and recovery phrases must also be securely documented.
• Consider Privacy Preferences: Understandably, not all clients want full disclosure of their digital lives. Thoughtful planning can protect both your privacy and your family’s needs. For instance, RUFADAA allows individuals to: limit access to certain accounts; restrict access to communications; and direct deletion of specific digital assets.
• Address Cryptocurrency and High-Value Digital Assets: Cryptocurrency and other decentralized assets present unique challenges becauseaccess depends on private keys or recovery phrases, and there is often no centralized authority to grant access. Because loss of credentials may result in permanent loss of the asset, they require enhanced planning, including secure storage and clear fiduciary instructions.