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
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
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
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!
In so far as Wills are concerned, it's essential to bear in
mind that aside from appropriate Will powers, executors may still
be restricted in what they can do with some digital assets. For
instance, online service providers may require users to consent to
the information stored in user accounts. Generally, users don't
own the uploaded material or supplementary rights to access that
information. Furthermore, service providers may decline access to
an executor or next of kin.
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.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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