Estate Planning – Covering your Digital Assets

Posted by on Saturday, December 6th, 2014
in Game & App Development, Privacy Law, Wills & Estate Planning

Efficient estate planning ensures that your worldly possessions transfer to your kith and kin in accordance to your wishes…but have you planned for inclusion of your virtual possessions? No longer are we able to pass on a bundle of love letters and pictures written to bridge the gap of miles and time. Similarly, we are no longer able to direct that a bundle of potentially scandalous correspondence be burned.

So many of us use free email accounts, picture hosting sites, music, movie and video storage, eBay, PayPal, Bitcoin and of course social accounts such as Facebook, Twitter and LinkedIn to list just a few examples and these contain massive amounts of information about our life. Generally speaking, most people’s virtual assets are divided into 3 broad groups, 1) accounts containing actual currency information; 2) accounts containing virtual property; and 3) accounts containing person information likely of personal or commercial interest to your heirs and others.

The first group seems a little more straight forward and includes accounts such as bank accounts that you only access through websites. A similar example might be your PayPal account that contains a balance. Slightly more difficult conceptually are accounts such as Bitcoin, World of Warcraft, Second Life, or X-Box live that deal in virtual currency but that may contain the equivalent of real world dollars that should be transferred on to your heirs. Finally, this group includes subscription accounts such as Skype, for which you may have a monthly subscription that automatically debits one of your other online accounts for payment.

A second group contains virtual property you own but which is held or stored in the cloud (a marketing term for not on your computer but on the company’s computer). This would include such things as music, movies, pictures or books. An article in The Economist from a few years ago stated the problem quite simply, in Britain individuals are holding in excess of US$14 billion in digital music alone.

Each content provider has their own terms of service which can vary. Some do not allow online content to be transferred if an account is cancelled or may simply try to delete content once they are notified of an account holder’s death (which is the subject of another post). This is developing law and will likely be confirmed as more people confront the difficulties of attempting to transfer validly purchased goods on to their heirs.

The third group includes your free email account, eBay, Facebook, Picasa, Twitter, LinkedIn or similar styles of accounts. The information contained in these accounts is of interest to your family and, in the case of some letters and pictures, may be the almost sole record of communication between parties for some time. Personally I have almost no physical pictures of my son who was born after we acquired our first digital camera.

Without further clarification on the exact terms of service and more confirmation from the courts or legislative bodies, the best practice may be to follow traditional Will drafting techniques – ensure your intent is clearly stated in your Will. So if you have an interest in protecting this information and passing it on to your heirs, the best course of action is to come in and have a chat with us at Vangenne & Company and include this information in your estate documents.