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Digital Estate Planning
As new forms of property and business become more common - such as domain names, Bitcoin and other cryptocurrencies, Apps, social media accounts, crowd sourced finance and other profitable hobbies - you may have to reconsider the way you think about your assets when making your Will.
With nine out of ten Australians presently holding at least one social media account, most of us possess some form of digital wealth that is worth considering when estate planning.
However, the unique nature of digital assets may mean that dealing with them may not be straightforward. In the course of administering your estate, your executor will need to consider and access any digital assets you may have. Likewise, your attorney during your life may need to do the same.
It’s important to consider your digital assets as part of comprehensive estate planning and to develop a strategy that assists your Executor or Attorney in seeing out your wishes when the time comes.
What is a "Digital Asset"?
All of the following are examples of digital assets:
- online accounts on social networking platforms such as Facebook, Instagram and Twitter
- email accounts
- Bitcoin or other cryptocurrency
- online gaming accounts
- music, photos or other files kept in cloud storage with providers such as Apple iCloud, Google Drive or Dropbox
- data, texts, documents and digital files stored on cloud or hard storage (hard storage can include laptops, desktops, USB keys or external hard drives)
- licenses to music, videos or movies purchased through service providers such as Apple iTunes, Amazon or Spotify
- blogs and domain names
- digital access to financial accounts; and
- intellectual property including trademarks and copyrighted material.
Are my Digital Assets of value?
Digital assets can have varying value, be it personal, sentimental or financial. It’s important to consider whether they are worth preserving and how.
Some digital assets, such as those connected to a business including domain names, blogs or intellectual property, may have commercial value and therefore carry real financial worth. As an example, if a business relies on email, the absence of timely access or denial of access to those emails could be detrimental to the business and even result in financial loss.
Consider also social media influencers and professional YouTubers. If they generate income from advertising, then their account may hold financial value. Proper estate planning would ensure this value doesn’t extinguish upon the death of the account holder.
Other digital assets may be valuable for emotional reasons. Have you given any thought to what happens to all your Instagram photos or Spotify playlists once you’re gone? Your loved ones may wish to hold on to them for sentimental reasons. Photos, videos and music stored electronically can often be lost if your representative is not empowered to access your acccounts and deal with them according to your wishes.
What happens to my Facebook if I die?
The answer to this question depends on how you have prepared for this event. Social media sites such as Instagram, LinkedIn and Facebook each have procedures setting out how an account is dealt with upon death.
Facebook’s default process is to memorialise the account upon notification of the account holder’s passing. The word "Remembering" appears before the deceased’s name. No one can log in to the account, and the profile remains available for the existing audience to view and share memories. Without the nomination of a “legacy contact”, which can be done through your Facebook settings, an account cannot be accessed or changed.
Effective Digital Estate Planning
There are a number of steps that can be taken to safeguard your digital assets in the event of incapacity or death:
- identify your digital assets and make a list;
- read the Terms of Service and check your account settings;
- update your Will and Power of Attorney to account for your digital assets.