Digital assets and death

In today’s digital age, our online presence and digital assets have become an integral part of our lives. From social media accounts to cryptocurrencies, these assets hold significant value, both sentimental and financial. However, the question arises: what happens to these digital assets when we pass away? This insight explores the importance of planning for the digital afterlife and provides guidance on managing digital assets after death.

Understanding digital assets

Digital assets encompass a wide range of online and electronic possessions, including: 

• Social media accounts: Facebook, Instagram, Twitter, LinkedIn, and other platforms where we share our lives and connect with others. 
• Email accounts: Personal and professional email accounts that contain important communications and information. 
• Financial accounts: Online banking, investment accounts, and cryptocurrencies like Bitcoin and Ethereum. 
• Digital media: Photos, videos, music, and eBooks stored on cloud services or personal devices. 
• Online subscriptions: Services like Netflix, Spotify, and other subscription based platforms. 
• Personal websites and blogs: Domains and content created and maintained by individuals.

The importance of digital estate planning

Just as we plan for the distribution of our physical assets, it’s crucial to consider our digital assets in estate planning. Without proper planning, these assets can become inaccessible or lost, causing distress for loved ones and potential financial loss. Here are steps that can be taken to ensure your digital assets are managed appropriately after your death:

• Inventory your digital assets: Create a comprehensive list of all your digital assets, including login credentials and security questions.
• Appoint a digital executor: Designate a trusted person to manage your digital assets. This individual should be tech-savvy and aware of your wishes regarding your digital presence.
• Include digital assets in your will: Clearly outline how you want your digital assets to be handled in your will. This may include instructions for closing accounts, transferring ownership, or preserving certain content.
• Use online tools: Some platforms, like Google and Facebook, offer tools to manage your account after death. For example, Google’s Inactive Account Manager allows you to decide what happens to your account if it becomes inactive.
• Keep information secure: Store your digital asset inventory and instructions in a secure location, such as a safe deposit box.

Legal considerations

The legal landscape surrounding digital assets is still evolving. Different jurisdictions have varying laws regarding the management and inheritance of digital assets. 

• Inheritance tax: Digital assets are subject to inheritance tax, and their value must be reported to HMRC as part of the estate. 
• Compliance: Executors must ensure compliance with relevant laws and regulations regarding the management and transfer of digital assets.

As our lives become increasingly digital, it’s vital to consider the fate of our digital assets after we pass away. By taking proactive steps to inventory, plan, and secure these assets, we can ensure that our digital legacy is managed according to our wishes and that our loved ones are spared additional stress during a difficult time. Digital estate planning is an essential component of modern life, and addressing it now can provide peace of mind for the future.

If you have any questions or need further assistance please get in touch with Natalie Butt.