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Digital Assets as Part of Your Estate Plan

I have just settled into seat 15A on flight VA872 from Sydney to Melbourne and upon retrieving my ‘large electronic device’ to start typing, I realise the technical resources I was intending to use to inform this article have not successfully downloaded. Aargh!

Instead, I start thinking more broadly. Why are digital assets even important in an estate plan? Why do we even care?

Most of the time, we don’t actually ‘own’ anything. Our use of Facebook, Instagram, YouTube, Snapchat, iTunes and the like is often under license and how we can deal with the technical content on those digital platforms is primarily dependant on each platform’s service agreements and policies. This may include creating an ‘in memoriam’ page or shutting down the user’s account upon death, incapacity, or lack of use.

What is the legacy we are actually wanting to pass on to our loved ones? It is the memories and moments in time captured in our photos and videos; it is the tapestry of our personality reflected in our taste in music or film; it is the sharing of our souls through emails or blogs or text messages. Most of the time these ‘digital assets’ have little monetary value, but they keep us alive in the hearts of the people whose lives we have touched.

But the value of digital assets goes beyond sentiment and memories. Our digital footprint includes electronic banking information, online accounts, digital wallets, cryptocurrency, internet domain names, online gaming accounts, and even intellectual property developed through blogging and developing a digital brand.

So how is the ‘Lawsaurus’ dinosaur dealing with this? Well, we are a bit behind the eight ball. Canada and the USA have already introduced legislation to give people the power to plan for the management and disposition of their digital assets in the same way that they can plan for other property, by allowing their executor to take control of their digital assets.

The New South Wales Law Reform Commission is currently reviewing access to digital assets upon death and incapacity, and my personal prediction is that it is likely we will follow the Canadian model.

What can we do in the meantime? Well, until the law provides more clarity in this area, at Partners Legal we recommend that will makers set out their wishes in relation to how they would like their executor to deal with their ‘digital assets’ in a Memo of Directions, with an inventory of usernames and passwords, instructions on the location of and access to these assets, and directions as to which assets must be preserved, and which can be deleted or destroyed.

Until the law catches up with technology (which let’s face it will probably never happen), it is worth putting some thought into who you would like to put in control of your digital assets (this may be different from the person you entrust to administer the rest of your estate) and expressing your wishes via a Memo of Directions.

If this article has raised questions for you, the team at Partners Legal can help.  
This article contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information.