We use online tools and accounts for most aspect of our lives, whether it be online bank accounts, Facebook account or domain name purchases etc. These online accounts and tools are more convenient and make our everyday lives easier to manage. However they can cause problems for family and friends when you die.
People often make Wills dealing with their tangible assets such as personal possessions, property and assets with paper records such as bank accounts and shares. Our digital assets also need to be considered and arrangements made for dealing with them when the inevitable does happen.
So what are digital assets?
There is no precise legal definition for digital assets. There are the obvious assets such as online bank and savings accounts but we also need to consider assets such as social media accounts, photographs and videos, blogs, emails, online gaming accounts and virtual currencies such as Bitcoins, digital music, subscription services and domain names to list a few.
There is a difference between sentimental value, for example most photographs and videos; and assets with monetary value, potentially bitcoins and domain names.
What are the problems?
The first significant issue is how will your Executor know your digital assets even exist and what access will they have to these digital assets if they do.
Also, how will your Executor deal with them? What requirements need to be met to allow another person to access, transfer or sell the assets?
Another problem will be putting a value to these. Particularly when someone’s estate is subject to Inheritance Tax it is important that all assets are valued correctly. Some assets, such as online music, may not have a value at all as the owner only has a licence to listen to the music. Other assets, such as virtual currencies may have a value in the online market and the Executor will need to determine the real value.
For items with sentimental value there may be problems if family or friends would like to receive these. Your Executor may not know what your wishes were.
So what can you do?
The main thing you can do is actually list your digital assets and who you would like to leave them to when you die. Your Will might need some specific wording to deal with these particular assets, so this is also something to consider.
You can also make arrangements to appoint a person to deal with your digital assets and it’s best if this is documented in your Will. If any assets have intellectual property rights, that may continue for many years, then you should consider appointing a specialist Executor to deal with these and decide who is to benefit from any royalties received.
In order for the person you appoint to know how to access these assets it’s worth considering using a password information service, this allows you to securely list all your username and passwords to access the different online accounts you may have in one location. Meaning you can give the person dealing with your digital assets when you die one username and password to access all the details they need to manage these accounts
With regards to the non-monetary value assets, such as your Facebook page it’s also worth noting in your Letter of Wishes (linked to your Will) how you would like these to be dealt with when you die. Facebook, for example, either allows your page to be completely deleted or they can create a ‘In Memory of….’ page.
Making provisions for our digital assets is a relatively new area of planning for the future and we anticipate that we will see continuous changes from the companies and organisations that provide the accounts and tools. Hopefully the procedures for dealing with these assets will become clearer but, for now, it is an area we all need to consider carefully and ensure proper arrangements have been made.
For more information on protecting and managing your digital assets when you die, please do not hesitate to get in touch.