What is a digital asset?
Digital assets are relatively new in the world of estate planning, but they have become an important part of our estates. Digital assets are intangible items and information stored electronically on devices like computers, smartphones, and USB drives, or that exist in the cloud, including:
- Email accounts, like Gmail.
- Social media accounts, such as Facebook.
- Online payment accounts, including PayPal.
- Online trading accounts, for example E*TRADE.
- Domain names, websites, and blogs.
- Online marketplace accounts, namely Amazon.
- Online gaming sites, such as World of Warcraft.
- Cryptocurrencies, like Bitcoin.
- Cloud storage accounts, including Dropbox.
- Digital libraries and playlists, like those on Pandora or Spotify.
Digital assets such as these may have sentimental, practical, or monetary value to you or your family and, as such, should be addressed in your estate plan along with other assets that you own.
How do I include digital assets in my Will?
Your digital assets may be valuable to your family and friends. This is why it is important to include them in your Will. However, not all of your digital assets can be passed on through your Will. Some have to be passed on in other ways, while others cannot be passed on at all.
Generally, any digital asset that you own and that is transferable can and should be included in your Will. This includes:
- Funds in online bank accounts, PayPal accounts, and accumulated in online stores, like Etsy and Amazon.
- Cryptocurrencies, like Bitcoin.
- Digital media that you own, such as music, photos, and videos.
- Reward benefits, like frequent flyer miles and hotel loyalty programs, when transferable.
Some digital assets are not transferable and, as such, cannot be passed on through your Will. Examples are:
- Email accounts.
- Social media accounts.
- Subscription services like Netflix, Amazon Prime, and Spotify.
- Mobile phone apps.
You usually do not own these types of digital accounts but have been issued a non-transferable license to use them. In these cases, the service provider will typically have measures in place to allow an authorized individual to close, delete, download files, or take other appropriate actions after you have passed away.
What happens if I die without a Will that includes my digital assets?
If you die without a Will that addresses your digital assets, the executor of your estate may find it very difficult or impossible to:
- Locate all of your digital assets.
- Access photos, videos, and other personal information stored in your online accounts, mobile phone, computers, etc.
- Shut down your social media accounts.
- Access information needed to finalize your estate and distribute your assets–information that may be stored, for example, in your email and banking accounts.
How do I make digital assets part of my estate plan?
Planning for what happens to your physical assets after you die is something you need to do to ensure your valued possessions end up in the right hands.
The same is true for your digital assets. Here are some tips on how to make your digital assets part of your estate plan:
- Take inventory of your digital assets. Be sure to note which assets will go to named beneficiaries of your estate.
- Create a document, often referred to as a Digital Asset Trust, listing the following information:
- Website addresses.
- Pin codes.
- Answers to security questions.
- Other information needed to log in to your online accounts.
- Store your Digital Assets Trust document in a secure location. Then give someone you trust access to the document, now or at some point in the future, so that they can retrieve your digital assets if you die or become incapacitated.
- If you do not have a Will, consider making one. Including a provision in your Will that gives someone the authority to access your digital assets, and leaves instructions for what to do with them after you pass away, will ensure that your digital assets do not get overlooked or lost. Also, it will allow you to dictate how your digital assets will be distributed.
Plan Confidently with Rocket Lawyer
Don’t forget to make a plan for your digital assets while you are creating your estate plan. Doing so will ensure that your digital assets are distributed according to your wishes. You will also spare your loved ones any difficulty in preserving your legacy. Don’t hesitate to consult with a Rocket Lawyer network attorney for affordable legal advice tailored to your individual circumstances and needs.
This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.