I've built a great online presence - What happens when I die?
The use of digital devices and social media is a widely accepted and integral part of life in today's society. The reality is that each of us in one way or another has generated our own digital assets. By way of definition, digital assets include your online accounts such as your social networking channels, email addresses, cloud storage, pay pal or other financial information. In addition, there are also your hard storage devices used to collect and save information of a private and financial nature such as laptops, desktops and external storage drives which are generally protected by encryption.
Many people don't think about how their digital assets will be dispensed with in the event of their death or incapacity but it is very important to have a plan in place regarding the management of your digital assets should either of the above circumstances occur.
In advising on estate planning, lawyers often discuss digital assets with clients, advising on the potential risks associated with excluding them from your Will. Careful planning around what to do with your digital assets can simply and effectively reduce risks such as hindering required asset transfers to family members who may not have access to or knowledge of your digital assets. It also means that any embezzlement after death which may expose digital assets or result in a shortfall for your estate beneficiaries can be pinpointed.
From a practical perspective, it's a good idea when you provide instructions for your estate planning documents, to prepare a digital inventory which details all of your assets including relevant usernames, passwords and secret questions, to enable simple access to your personal and financial information. This is particularly helpful for your appointed Attorney should he or she wish to exercise their authority pursuant to a Power of Attorney. In the case of a Power of Attorney, you can also request the inclusion of a specific clause to give your Attorney the power to control and deal with your digital assets. It would be sensible to nominate someone who is tech savvy and will have no difficulty accessing and managing your digital assets. Once your inventory is complete, make sure that you remember to update it when you periodically change your passwords. Store the information securely whilst remembering to make sure that it's accessible to those you have allocated permissions to should they need it!
It would be fair to say that the law is forever changing - as are modern forms of asset ownership. With the majority of the population reliant on social media, the growth of digital assets is inevitable. Unfortunately, digital assets are not personal property in the sense that they can't be classified as physical property which can be transferred to a third party. Although digital assets aren't presently administrated by any legislation in NSW, it is still important to minimise the risks by making an allowance for your digital assets in your estate planning documents.
If you have any questions around making provisions for your digital assets in your Will please contact our Wills and Estates team:
Rosemary Carreras, Senior Associate
Phone: +61 2 9895 9277