Managing your digital footprint

By Mary Wall

As technology continues to advance, we live in an increasingly online world. It seems we are always connected ”” from social media activity to digital photos and more. Virtually everyone today has a digital footprint, but not everyone understands how that footprint can have a significant impact on your financial life.

New complexities come with a digital world: protecting digital assets as part of estate planning, managing your online reputation so that it has a positive impact on both your personal and professional development, and avoiding risks such as identify theft. In order to properly manage these complexities, it is essential to put a digital plan in place.

Technology has not only revolutionized our world, but it has also become an asset. Digital assets include online personal, financial, social and business assets, as well as their monetary and sentimental worth. Despite their value, more than 63 percent of high-net worth individuals do not have a strategy in place outlining procedures for their digital assets. Additionally, 45 percent do not have organized passwords that can be shared with family members. The majority of these individuals have not addressed the trust and estate concerns regarding ownership and access to various financial information, health records, loyalty programs, photos, business intelligence, social media sites and other private information.

Advanced planning around digital assets can help prevent losses and avoid unexpected costs in the future. To avoid these losses and get started, prepare a digital inventory, address storage of that inventory and be sure to consistently update your inventory. Finally, update your Power of Attorney and Will with specific provisions to deal with digital assets.

Another important aspect of your digital footprint is your online reputation. Whether posted by yourself or others, your online information can affect everything offline. When applying to school or for a job, or even when building other personal relationships, your online presence is always evaluated and taken into account. For example, in 2013 more than three-quarters of United States-based companies actively research online information about applicants. Actions such as posting negative or inappropriate comments, sharing private information, posting content pertaining to alcohol or drugs or even simply making grammatical mistakes can hurt your online reputation. To properly manage your online presence, understand that content on the internet can be difficult to remove completely, so it is best to minimize, or even eliminate, anything you would not want others to see.

Increasing reliance on technology has also increased the problem of identity theft. Identity theft occurs when someone uses your personal information without your authorization with the intent to commit fraud. This can happen through dumpster diving, phishing, telemarketing schemes or a phony credit card check. Keep in mind that when you are active on websites that track your location in real time, you are also exposing yourself to potential risk. Therefore, you must always be cautious and alert in order to protect yourself. You control the information that you release and therefore you are the best person to protect yourself.

To try and prevent identity theft, consider paperless statements to avoid documents falling into the wrong hands, shred materials with personal information and never click on links in emails that ask for personal information.

Although it may seem difficult in an always “connected” world to properly manage your digital footprint and create an appropriate plan for your digital legacy, by following the mentioned steps or consulting with your financial advisor, you can greatly reduce your exposure. At U.S. Trust, for example, we have expanded our financial empowerment program to cover online reputation and digital asset management.

The program was created based on client feedback and proprietary research that revealed that investors were not properly considering planning for digital assets or the risks they were taking online. Wealth management and investing needs are constantly evolving and we must be sure to evolve alongside them. Therefore, it is imperative to keep up with our transforming world and secure our digital footprint to the best of our abilities, both personally and financially.

Mary Wall is managing director and wealth strategist for U.S. Trust, based in Stamford. Her email address is mary.wall@ustrust.com.

Editor’s note: This article has been updated to correct the author’s email address.