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Take a moment to reflect on the extent of our digital lives: Millions spend precious hours networking on social media, while individuals can now run entire businesses from laptops, or trade stocks from their smartphones.

Estate planning document with pen

Despite this, ideas of legacy and inheritance remain tied to the physical realm: a book collection or the contents of a savings account is far more likely to appear in a will than one’s digital assets.

This is a grave error. People own more than they realise, and consequently are neglecting adequately to protect it for when they are gone. Nowadays, a will needs to include your physical assets as well as your digital ones. Digital assets can be of immense and increasing value, but without the proper care, they can fall into the wrong hands – or disappear entirely.

Defining your digital assets

What does and doesn’t count as a digital asset? It’s less simple than it appears – especially since you don’t always own what you’ve paid for. You might assume that your MP3s, eBooks, or Steam downloads will make an impressive bequest for your loved ones. Unfortunately, this isn’t the case. When you pay for a song or a video game online, you’re really paying for a non-transferable license that essentially expires when you do. Where iTunes is concerned, the rights revert to Apple, and to accept their End User License Agreement is to give your explicit consent to this arrangement. In effect, the songs can’t be transferred because they were never yours to give away.

However, while this might seem unfair, it’s – fortunately – the exception rather than the rule, and there’s a good chance you still have digital assets to pass on to your peers. If you received significant winnings through online gambling but never thought to withdraw them, this could be a goldmine for your heirs. The same goes for funds stored in Paypal: while it’s unusual for individuals to leave large sums in their accounts, doing so may be standard practice if you’re running an eBay store or an ecommerce site. In this scenario, the cash flow won’t necessarily end with death: incoming payments could arrive for a long while after you’ve passed on.

Domain names are another, often overlooked, digital asset: while normally not worth much on the surface, there is always the chance that domain names could suddenly become valuable.

Of course, not all your digital assets will be monetary. Social media accounts host personal messages, photographs, video clips, and more – to a family member, this sentimental treasure trove may be worth more than any financial gift.

Where there’s a will…

So how should you make provision for your digital future? The first thing to do is appoint an executor to manage your estate – someone capable of safeguarding both your physical and digital assets. Without a nominated executor, any family or friend can put themselves forward to distribute your estate according to the intestacy rules. Would your parents or someone from an older generation know the full extent of your online presence or how to properly manage it?

Where the assets themselves are concerned, there are a number of steps you can take to ensure your wishes are enacted. Whilst hosting websites can sometimes gain control of your accounts, the right to limited access of your account generally defaults to your next-of-kin unless you’ve stated otherwise in your will or in the account settings (if that option is available). Not everybody wants their parents or siblings having unfettered access to years of private correspondence, so it’s best to leave instructions and a list of authorised users in your will regarding who is to manage that email account and have your settings adjusted to reflect this.

Naturally, the situation becomes more complicated when money is involved. For example, you may want your friend or flat mate to benefit from the still-accumulating revenues of your ecommerce site. However, leaving your Paypal password with them does not provide a clear solution: just knowing someone’s password and being “allowed” in the past to access their account does not mean they can do so once the named account holder is deceased. Leaving clear instructions in a professionally prepared will is the surest way of avoiding any tension between those closest to you.

The instructions you draw up need to be as comprehensive as possible: if your executor is unaware of valuable assets, they could be liable for any discrepancies. They are required to value the whole of your estate, both physical and digital assets. Complete a thorough “personal assets log”: a document that details all your online assets and the passwords to your various accounts. This will ease the burden on your executor considerably – and remove the possibility of them being made liable for an oversight.

Consciousness of digital assets is increasing every day. High profile cases (like that of Bruce Willis) have helped the issue reach a larger audience, and Facebook has introduced tools to memorialise or delete the profiles of dead loved ones. Nonetheless, the attitude towards one’s online property is still limping behind the times. By educating yourself and making the necessary preparations, you can spare your loved ones a lot of unnecessary pain – and ensure your digital assets end up where they’re supposed to be.


For more information on the topics covered in this post, or for any other wealth or wills-related queries, you can contact us on +44 (0) 20 7759 7519 or email one of our wealth experts.

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