How to Plan for Digital Assets in Your Will

In the modern era, digital assets have become an integral part of our daily lives. From photos and videos stored on the cloud to social media accounts and online banking platforms, we are increasingly conducting important personal and financial activities in the digital realm. However, these digital assets are often overlooked when it comes to estate planning. As a result, many people fail to ensure that their digital legacy is handled according to their wishes after they pass away.

When it comes to writing a will, it is important to not only consider physical property like real estate, investments, and personal belongings, but also to plan for the digital assets that you own. Properly planning for your digital assets ensures that your loved ones can access and manage these items, and that any digital property you wish to pass on is distributed in accordance with your desires.

This guide will provide you with a comprehensive approach to planning for digital assets in your will, discussing key considerations, common types of digital assets, and practical steps to take to ensure that your digital legacy is well-preserved and respected after your death.

What Are Digital Assets?

Digital assets refer to any content or information stored or used in digital form. These assets can take many forms, ranging from photos, documents, and videos to more complex items like cryptocurrency, domain names, or even social media accounts.

Some common examples of digital assets include:

• Personal Files: Photos, documents, videos, music, and other media that you have stored on your devices, cloud storage, or external hard drives.
• Email Accounts: Your email inbox, including personal, professional, and subscription emails.
• Social Media Accounts: Accounts like Facebook, Instagram, Twitter, LinkedIn, and others, including the content, messages, and relationships associated with them.
• Digital Currency: Cryptocurrencies such as Bitcoin, Ethereum, and other blockchain-based assets.
• Online Business Accounts: Accounts for e-commerce platforms like Etsy, eBay, or Shopify, or for subscription services like Patreon, YouTube, or other monetized online platforms.
• Intellectual Property: Patents, trademarks, copyrights, or domain names you may own.

In addition to these examples, digital assets can include things like online banking accounts, digital memberships, and even virtual property in online games.

Why Digital Assets Matter in Estate Planning

As the digital world continues to expand, digital assets increasingly carry financial, personal, and emotional value. They are often an important part of someone's legacy. For example:

• Financial Assets: Many people hold significant amounts of money in online accounts, whether it's in online banking platforms, PayPal accounts, or digital wallets for cryptocurrencies. These assets are just as important as physical assets like real estate or stocks, yet they require special planning to ensure they are passed on correctly.
• Emotional Assets: Digital content, such as photos, videos, and personal emails, holds sentimental value for family members and friends. These types of assets may contain precious memories or provide a final connection with a loved one.
• Business Continuity: If you own an online business or have a professional digital presence, your digital assets will play a role in ensuring that your business continues to run smoothly after your death.

Without proper planning, your loved ones may face unnecessary challenges when trying to access and manage your digital assets. Many online platforms have strict terms of service that prohibit the sharing of login credentials or access to accounts after death, and without proper authorization, family members or executors may not be able to access these accounts.

Legal Challenges Surrounding Digital Assets

One of the main challenges with digital assets in estate planning is the legal complexity involved. Different countries and jurisdictions have varying laws related to digital assets, and many online platforms have specific terms and conditions that govern what happens to your accounts after you die. Some key considerations include:

3.1 Terms of Service Agreements

Most digital platforms have terms of service that govern how accounts are managed after the account holder passes away. Some platforms may allow family members or executors to request access to the account, while others may not. It's essential to familiarize yourself with the terms of service of each platform and plan accordingly.

For example:

• Google offers an "Inactive Account Manager" feature, which allows users to specify what should happen to their account and data after a certain period of inactivity.
• Facebook and Instagram allow users to designate a legacy contact to manage their account after death. This contact can either memorialize the account or request its deletion.
• Apple has the "Digital Legacy" feature, which lets users designate legacy contacts to access their data.

These features can simplify the process of managing digital assets, but they must be set up in advance.

3.2 Digital Asset Ownership

Some digital assets are not entirely owned by the individual. For example, music, movies, or books purchased from services like iTunes are typically licensed rather than owned. This means that these assets may not be transferable upon death, and there may be restrictions on who can access or inherit them.

Cryptocurrencies, on the other hand, are typically owned outright, and proper planning is necessary to ensure that access to these digital assets is transferred to the appropriate parties.

3.3 Privacy and Security Concerns

Digital assets are often subject to privacy and security concerns. Without the right legal permissions or access credentials, a deceased person's family or executor may not be able to access important information or data, which could be crucial for managing the estate or fulfilling the deceased's wishes.

Steps to Plan for Digital Assets in Your Will

Now that you understand the importance of planning for digital assets, let's explore the practical steps you can take to ensure that your digital assets are properly addressed in your will.

4.1 Make a Comprehensive List of Digital Assets

The first step in planning for your digital assets is to create an inventory of all the digital assets you own. This list should include:

• All online accounts (social media, email, shopping accounts, banking, etc.)
• Digital files stored on personal devices (photos, videos, documents, etc.)
• Online memberships and subscriptions
• Cryptocurrency wallets and digital currencies
• Domain names or intellectual property
• Any online businesses or platforms

For each asset, record the following information:

• The name of the platform or service (e.g., Facebook, PayPal, Google Drive)
• The username or account number
• The password (use a secure password manager to store this information)
• Any two-factor authentication methods or recovery codes
• The value of the asset (if applicable)

4.2 Use a Password Manager

A password manager is an essential tool for securely storing the login credentials for all your digital assets. Many password managers offer features that allow you to designate a beneficiary or executor who can access your passwords after your death. This can make it much easier for your loved ones to access and manage your digital assets without risking the security of your accounts.

4.3 Designate a Digital Executor

A digital executor is someone who is responsible for managing your digital assets after your death. This person could be the same as the executor of your will, or it could be someone specifically appointed to handle your digital affairs. You should inform your digital executor about your digital asset inventory, and ensure they are comfortable with handling the tasks that may arise.

4.4 Specify Your Wishes for Digital Assets in Your Will

In your will, you should clearly specify how you want your digital assets to be handled. This may include:

• Who should inherit your digital assets
• How your digital accounts should be managed (e.g., deleted, memorialized, transferred)
• Whether your digital business accounts should be passed on or closed
• How to handle any cryptocurrency or digital wallets

It is important to understand that not all online platforms allow digital assets to be transferred to another person. You may need to grant access to specific accounts through a power of attorney or another legal document, depending on the platform.

4.5 Include Instructions for Legacy Contacts

For platforms that allow you to designate legacy contacts (e.g., Facebook, Google), make sure you include these instructions in your will. This will ensure that your designated legacy contacts have the proper authority to handle your accounts.

4.6 Use a Digital Will

In addition to your traditional will, you may also want to consider using a digital will or online estate planning service that allows you to store and manage your digital assets. Some services allow you to specify your wishes for digital assets and provide instructions for how to manage them after death. These services may also store your passwords and account information securely.

Conclusion

As digital assets continue to play a larger role in our lives, planning for their management and distribution after death is more important than ever. By taking proactive steps to inventory your digital assets, designate a digital executor, and specify your wishes in your will, you can ensure that your digital legacy is properly handled.

Remember that digital asset planning is not a one-time task. It's important to regularly update your digital asset inventory and review your plan to ensure that it reflects any changes in your online presence or assets.

By including digital assets in your estate plan, you can provide peace of mind for your loved ones, and ensure that your online legacy is protected and managed in accordance with your wishes.

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