When we think of wills, we tend to think of physical things, of cherished heirlooms, such as our great-grandfather's pocket watch, our grandmother's wedding dress, or the family home, but what of the intangible keepsakes in our life? What are digital assets? What are digital assets in a will?
In the age of the Cloud, and social media, more and more of our lives are being played out virtually, so it's only natural that some of the things we hold dear also exist in the digital realm. These “items” are known as digital assets.
What Are Digital Assets?
What are digital assets in a will? Digital assets are defined as any item that exists in a digital format that you have a personal right to access or use. In other words, if you own anything that is only accessible via a computer or phone, it's considered a digital asset.
Not all digital assets can be passed on via a will, but we still recommend that you grant access to them in an accompanying document - consider adding digital assets clause in will. In this way you would know exactly what happens to your digital assets when you die. This is the reason why it is recommended to have an early digital assets estate planning so they can be managed by your loved ones.
Don't worry if you're more befuddled than ever after those definitions; it can be quite a confusing concept at first, so let's take a look at some specific examples of digital assets.
What Happens to Your Digital Assets When You Die
To supplement more answers to your question, "What are digital assets in a will?" here are the digital assets that you can pass on via will:
- Digital Media (Photos, Videos, Music)
Computers and the Cloud have become the cardboard boxes of the modern age, holding everything from family photos and videos, to our music collections. If these items aren't accounted for during the preparation and execution of your estate plan, your loved ones may lose countless cherished family memories in one fell swoop.
- Non-Fungible Tokens (NFTs)
NFTs are unique units of data stored on digital ledgers that provide public proof of ownership over a digital asset. They can be worth a lot of money, but if they're not included in the will, the NFT deed will remain in your name.
A cryptocurrency is a digital currency, and just like your paper money, you should specify an inheritor in your will.
- Digital Documents
More often than not, deeds of ownership pertaining to artistic creations such as music, film, theatrical works, and literature are stored online as digital documents. If said deeds are left out of your will, your loved ones will not qualify for royalties or have any say in matters of deed management.
Digital Assets That Cannot Be Passed On Via a Will
- Social Media and Email Accounts
As social media and email accounts typically don't have a value, ownership cannot be traded via your will, but you can grant access to family or friends so that they can manage them according to your wishes.
- Online Subscriptions
Temporary digital assets such as Netflix or Disney+ subscriptions can't be passed on to your will, as, technically, you do not own any aspect of the service. That said, you may still need to grant access to your accounts so your loved ones can halt payment.
- Licensed Domains
Owning the license to a domain is not entirely the same thing as owning the domain itself, so you cannot pass it on as property in your will, but, as domains can be valuable commodities, we recommend noting down access information in a document that can be addressed after your passing.
Why It's Important to Disclose Access Information of Digital Assets in Your Estate Plan
Passable digital and tangible assets should be regarded equally, as they can both be passed on in a will; however, as a nascent phenomenon, the laws and protocols surrounding digital assets are still in flux.
Notions of ownership understandably become a little blurry when it comes to intangible items, so it's easy to forget to include them in your will, but if these ephemeral entities are left unaccounted for, your loved ones will run into one or more of the following obstacles.
The passwords you came up with to keep ne'er do wells out of your phone, computer, Cloud, and online accounts could potentially prevent your heirs from accessing your data.
Encryption is any protocol that adds another layer of security on top of password-protected data. Modern-day encryption can be nigh on impossible to crack, so if access codes aren't included in a will, loved ones may never be able to access the store data.
- Criminal Laws
To prevent fraud and identity theft, our online data is protected by both federal and state laws, and these laws apply to everyone, including relatives of those that have passed. There has been a concerted effort to add more nuance to these laws in this regard, but for the time being, the only way to ensure loved ones have access to your digital assets is by granting permission in your will and providing any necessary log-in details.
- Privacy Laws
There are also laws in place to prevent online service providers from passing on your digital data to unauthorized persons or institutions. Again, in life, this is for our own good, but once we pass, it poses yet another problem to our heirs.
How Are Digital Assets Added to a Will?
The good news is that, with our help, making your will online and bringing your estate plan into the digital age is incredibly easy, but before you get started, let's discuss a few things you can do to streamline the process.
- Make a List
Your first port of call should be to make a list of all your digital assets. Include all your online accounts and any log-in information. As your will becomes public record after your passing, it's important that this information is noted on an accompanying document rather than the body of the will itself.
- Double Check Ownership
Understanding the difference between ownership of, and license to use, something is important. Make sure you have a right to pass a digital asset on.
- Backup Your Data
Don't trust the Cloud to take care of everything. Back up all your data to prevent accidental loss and grant your heirs easy access to your digital assets.
- Be Specific
Granting your beneficiaries blanket access to all of your digital assets can complicate things. Be as specific as you possibly can in regard to who receives the passable digital assets and who should receive the log-in information of your non-passable digital assets.
It also helps to leave specific instructions on how your digital assets should be managed. For example, do you want your social media accounts taken down after your passing? If so, when?
We'll Take It From There
The remainder of the process is a collaboration between you and Timur Berberoglu, our amazing in-house estate planning attorney with over 15 years of industry experience. Together, you will work on transforming your intentions into legal documentation, ensuring everything plays out exactly how you want it to.
Digital Assets Estate Planning: Making It Easy
Creating a will has never been a pleasant task, and with the rising prominence of the digital world, it's becoming increasingly complex, but here at Wills.com, we pride ourselves on sharing the burden.
A will is a parting gift for loved ones, and we believe that the giving of such gifts is a wonderful thing, which is why our hope is that by making will composition as care-free as possible, you can truly enjoy the beauty of your act.