Digital assets and estate planning

As we move into an ever more digital age, the concept of digital assets has become more prominent, but many people still don’t consider these specifically within their estate planning.

In this article, our Wills, Trusts & Probate expert, Louise Gibbs-Kneller takes a whistle-stop tour of some of the issues around digital assets that need to be considered.

 

What are digital assets?

 

Put simply, a digital asset is anything that is stored digitally and is uniquely identifiable. This covers a broad spectrum and includes (but is not limited to) all of the following:

• Documents/manuscripts stored on a device.
• Audio/video files or photographs.
• Logos, illustrations, or animations.
• Non-fungible tokens (NFTS).
• Email accounts/other digital accounts such as social media or loyalty apps/accounts.

All of the above could have either a monetary or sentimental value.

 

Why do I need to consider digital assets in my Will or estate planning?

 

You will appoint executors within your Will. The role of your executor is to deal with everything you own at death, and this will include your digital assets as well as the physical ones such as property or bank accounts.

This means it is vital that you consider these when thinking about your Will and your estate and take steps to ensure your executors know what you have, especially if it may have monetary value.

You may need to consider whether it is necessary to appoint an additional executor to assist with your digital assets.

Some digital assets such as cryptocurrencies are not easy to deal with, in large part due to their current lack of transparency which can make them tricky to transfer on death.

Additionally, if the relevant key for these assets is lost then the asset becomes untraceable and unrecoverable, so ensuring safeguarding of things such as cryptocurrencies is an essential part of your estate planning.

Additionally digital assets are not always easy to decide about, so you may need to specifically consider how these are dealt with in your Will and who they should go to.

 

Planning considerations for particular types of asset

 

Let’s take a look at what might need to be considered for different types of digital assets:

Photos/videos – often these will have sentimental value as treasured memories of times passed, but they can have monetary value if of a professional standard and may have copyright attached to them as well. So, what needs to be considered?

• Making hardcopy albums of photos in case the digital copy is lost.
• Consider appointing a separate executor to deal with a back catalogue where copyright is attached to the photos/videos.
• If personal memories, consider if you would want family members to see them. If there is a possibility that they would cause distress you may wish to consider deleting them in your lifetime, as your executors may not be able to after your death.

Music downloads – through streaming services such as Spotify or Apple music. These are usually on licence with the provider. On death the licence usually comes to an end and access to the music is lost.

• If there are songs with sentimental value, you may wish to burn a copy to a CD but check within the terms and conditions of the provider first to ensure you are not violating any terms of the licence.

Loyalty points – schemes such as Nectar, Tesco and Boots (and the numerous others out there) offer points which can soon add up and these have a monetary value.

• Some of them can be passed on death to a nominated person. However, the rules are different for each scheme, so it is important to check the terms for any loyalty point schemes you are signed up to in order to see if they can be passed on.

Emails – both Google and Apple have mechanisms in place to allow temporary access to email accounts. A nominated person needs to be chosen during your lifetime, and they will be able to access and close accounts with these providers. Other providers may vary, so it is important to check with the provider. There are also several other considerations:

• Is there anything sensitive or confidential in your emails? Could the content cause distress or upset for family members? If so, consider deleting those emails during your lifetime.
• Does any of the content of emails have monetary value? If so, consider backing these up on a hard drive, or by printing hard copies.
• Do the emails relate to a business? If so, it is crucial to consider and plan for what happens to business emails and ensure these can be passed on. This is a crucial part of succession planning for your business to ensure business continuity.

Social media accounts – Facebook, Instagram, X formerly Twitter (and others) all have options for accounts post death, again it is important to check with each one to see the options.

• Most include options of deletion or memorialising the accounts, and a legacy contact will again need to be nominated.

Intellectual property – this can include copyright, patents, literary or musical works to name but a few.

• Consider appointing an executor to deal exclusively with these assets who has experience of dealing with them.
• Ensure your executors know where to find documentation relating to these assets. Including details around royalties and any contracts related to them.

 

Conclusion

 

The above are examples of just some of the considerations around digital assets people need to think about when estate planning, and a good starting point is to consider doing the following:

• Making a list of your digital assets to be stored with your Will.
• Writing a letter of wishes to assist your executors in relation to your digital assets.
• Backing up items on hard drives or by printing hardcopies.
• Closing inactive accounts.
• Considering deleting any sensitive or confidential information you don’t want family members to see.
• Trying to review terms and conditions.
• Setting up legacy contacts where this is available.

 

Here at Fosters Solicitors, we can assist and advise you around your digital assets and all other aspects of your estate planning to help ensure your loved ones have everything they need to effectively administer your estate.

Please contact us for more information. More details of our award-winning Wills, Trusts & Probate services can be found here.

 

This article was produced on the 8th May 2024 by our Wills, Trusts & Probate team for information purposes only and should not be construed or relied upon as specific legal advice.