In today’s digitally dominant world, our lives are increasingly lived and recorded online. It’s not just our social media profiles and email accounts, but a vast array of digital assets, including blogs, eBooks, digital photos, music, financial accounts, and cryptocurrencies, that form a considerable part of our personal legacy.
While these digital assets have considerable sentimental and monetary value, they can often be overlooked in traditional estate planning, leading to complications and potential loss after the owner’s demise.
Digital Asset Estate Planning is the process of organizing and securing digital assets for easy access and management after the owner’s death or incapacity. It involves creating a detailed inventory of online assets, appointing a digital executor, providing access details, and giving clear instructions on how these assets should be managed or distributed.
The new era of digitisation calls for a new approach to estate planning. A comprehensive digital asset estate plan can ensure that your online legacy is preserved and passed on as per your wishes, preventing legal disputes, financial loss, and emotional distress for your loved ones.
Types of Digital Assets to Include in Your Estate Plan
Acquaint yourself with diverse digital assets that should be considered when crafting your estate plan:
1. Financial accounts: Bank accounts, investment accounts, e-wallets, and cryptocurrency holdings are all part of your digital financial assets. Careful management and documentation can prevent unauthorised access and asset loss.
2. Social media profiles: Social media platforms, such as Facebook, Twitter, and Instagram, may contain personal information and treasured memories that your family members would wish to preserve or close down after your death.
3. Digital subscriptions and memberships: Online services, including streaming platforms, shopping memberships, and paid newsletters, may require cancellation after your passing to avoid unnecessary costs and complications.
4. Digital media collections: Music, films, e-books, and digital art files are valuable and often sentimentally significant assets that should be incorporated into your estate planning strategy.
Safeguarding Your Digital Assets
Implement robust security precautions to protect your online accounts and assets from unauthorised access:
1. Comprehensive inventory: Assemble a comprehensive inventory of your digital assets, including account details, login credentials, and relevant associated documents. Maintain this inventory securely and share its location with a trusted individual or include it in your estate plan.
2. Two-factor authentication: Enable two-factor authentication for your digital accounts to reduce the likelihood of unauthorised access and account breaches.
3. Password managers: Utilise a reputable password manager to centralise and further secure your login credentials, minimising the risk of lost or compromised accounts.
4. Regular updates: Periodically review and update your digital asset inventory to ensure that your estate plan reflects your current online footprint.
Incorporating Digital Assets into Your Will or Trust
Design an estate planning strategy that seamlessly integrates your online and offline assets:
1. Appoint a digital executor: Assigning a digital executor in your will can help ensure that your online assets are managed according to your wishes and in line with any legal requirements.
2. Encourage dialogue: Communicate your digital asset management preferences with your family members, digital executor, and professional will writer. A clear understanding of your desires will help prevent confusion or disputes after your passing.
3. Define the scope: Be explicit when defining the digital assets that your executor is responsible for managing. Include account details, login credentials, and any specific instructions or conditions.
4. Consider a digital asset trust: Digital asset trusts can offer additional privacy and control over your online assets, ensuring a secure and legally compliant distribution process.
Legal Considerations Regarding Digital Assets
Account for legal requirements and constraints surrounding digital asset management during estate planning:
1. Terms of Service agreements: Familiarise yourself with the Terms of Service agreements of your digital accounts, as these may dictate how your accounts are to be accessed, suspended, or closed upon your death.
2. Data privacy laws: When planning for digital asset management, take into account data privacy laws such as GDPR, which may limit what personal information can be shared and managed by your digital executor or beneficiaries.
3. Intellectual property rights: Consider the intellectual property rights associated with your digital assets, such as copyright, and ensure your estate planning reflects the appropriate transfer of ownership or licensed use.
Understanding Digital Wills: The Future of Estate Planning
In essence, digital asset estate planning reflects the intersection of technology and law, underlining the need for a dynamic approach to estate planning in the digital age.
Sovereign Planning’s professional will-writing services in the UK offer expert guidance and support in crafting a comprehensive estate plan that encompasses both your traditional and digital assets. Book a consultation today to explore your digital asset estate planning options!