Technology is forcing us all to change the way we think of personal finance. As our lives become increasingly digital, we need to adapt the way we think about wills to include our online presence.
In this blog I’ll explore what the most common digital assets are, how to incorporate them into a regular will, and how doing so will benefit you.
Common Digital Assets: A Brief Overview
Most of us have an online presence, but we don’t think about that presence as having any real value. If you think about it for a few minutes though, you will realize that your online presence is immensely important! Actors, actresses, musicians, politicians, and other celebrities are already acutely aware of this and jealously guard their online reputation, but most of the rest of us don’t give it much thought.
What if your online reputation was damaged though? What if someone hacked your online account on Facebook, Instagram, etcetera, and started posting horrific illegal pictures or writings? Your reputation with friends, acquaintances, and work would be negatively affected! Your online presence has value. Most of us just think about it that way.
Here are some digital assets that you may have that you should consider both safeguarding and leaving to others if something should happen to you:
1. Social Media Accounts
From Facebook and Instagram to LinkedIn and Twitter, your social media accounts contain a wealth of memories and connections. Specifying how you want these accounts to be handled ensures your digital legacy is managed according to your wishes.
Without specifically leaving these accounts to others in your will, your family, and even your executor, may have difficulty accessing them, shutting them down, or even controlling access to them.
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2. Digital Photos and Videos
Our smartphones and digital cameras capture countless moments. Including instructions on how to access and distribute these digital memories ensures they are shared with the right people, and maybe even more importantly, not sharing them with others.
3. Cryptocurrencies and Online Investments
The rise of digital currencies and online investment platforms requires careful consideration in Digital estate planning. Including details about these assets in your will prevents potential loss or disputes over their ownership. Especially with Cryptocurrency.
Without the access codes, the accounts are locked to everyone. Unlike a bank, you can’t show up with a will and a death certificate to gain access to the account. No codes – no access.
4. Intellectual Property
If you are a content creator, artist, or writer, your digital portfolio is a valuable asset. Clearly outlining the ownership and distribution of your intellectual property in your will ensures that your work is protected, continues to contribute to your legacy, and is transferred to your heirs as you wish.
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The Benefits of Including Digital Assets in Your Will
There are many benefits to including digital assets in your will, and no downside! The biggest stumbling block that people face is just recognizing that they have digital assets that need to be addressed.
1. Preserving Your Digital Legacy
Including digital assets in your will ensures that your online presence is preserved and passed on to your loved ones. Everything digital from memories on social media to valuable digital content like cryptocurrency, can be easily transferred to the people of your choice if you include them in your will.
If you don’t include them, then they either get lost, fall between the cracks of the legal system, or are transferred by law to people that you would rather not have them.
2. Avoiding Legal Complications
Without clear instructions in your will regarding your digital assets, your heirs may face legal complications when attempting to access or manage your online accounts. A well-drafted will can streamline the process and prevent unnecessary hurdles.
3. Protecting Financial Assets
Digital assets encompass not only sentimental items but also financial resources such as cryptocurrencies, online investments, and digital currencies. Including these assets in your will ensures that your heirs can inherit and manage these valuable resources appropriately.
4. Ensuring Privacy and Security
A will for digital assets enables you to address privacy concerns and specify who should have access to your sensitive online information. This adds an extra layer of security and control over your digital presence after you’re gone. You don’t give everyone access to your accounts or your phone when you are alive. Why would you let others access it if something happens to you?
Real-World Examples of Loss Due to Neglecting Digital Assets in Wills
1. Lost Cryptocurrencies
In 2013, Gerald Cotton founded an investment company called “Quadriga.” It focused on investment in cryptocurrency. By early 2018 Quadriga had over $250 million of investment. In December of 2018, Gerald Cotton unexpectedly passed away while traveling. He, and he alone, knew the access codes to the crypto wallets that held everyone’s investments.
Unable to access the accounts, Quadriga declared bankruptcy and all $250 million of investments were lost. This happened to a corporation, but the exact same scenario has happened to many individual investors. Cryptocurrency is a popular investment today and if you invest in it, it is imperative that you protect that investment.
2. Inaccessible Social Media Accounts
You can easily find numerous stories of families that have faced challenges gaining access to the social media accounts of their deceased loved ones. Many families grieve for years as social media account continue to send out “remember when” notices about their deceased client.
Without clear instructions in a will, platforms may be unwilling to grant access, leading to the potential loss of cherished memories and digital connections. Facebook in particular, will “memorialize” a person’s account but won’t remove it without legally binding instructions for an executor to do so.
3. Disputed Intellectual Property
Failure to address digital intellectual property in a will can result in disputes among heirs. Artists, writers, and content creators should explicitly outline how their digital works should be managed and distributed to avoid conflicts.
Conclusion: Embracing the Future of Estate Planning
We all have digital assets whether we recognize it or not. Because of that, it is important that we all proactive and comprehensive approach to estate planning in a way that includes our digital assets.
A will that includes digital assets is not just a legal formality; it is a crucial step in safeguarding your online wealth and preserving your digital legacy for future generations.
As we navigate an increasingly digitized world, incorporating digital assets into wills ensures that your loved ones can seamlessly inherit and manage both the tangible and intangible aspects of your estate.
Don’t let your online presence become a source of confusion or loss—take the necessary steps to include your digital assets in your will or contact a proper organization for will set up and embrace the future of estate planning.