In a recent survey PWC* estimated that UK households have more than £25 billion in digital assets.
A digital asset is content owned by any individual that is stored in digital form. All your digital assets combined make up your Digital Estate. For most people in the UK a proportion of their estate is digital. The largest digital assets might be your iTunes library for music, Amazon for digital books, email accounts, shop accounts like ASOS.com and PlayStore, and online bank accounts. Many people also have their own domain name – this also has a value.
So what happens to digital assets when you pass away – and how do you ensure they are dealt with according to your wishes?
James Hickman is a digital assets expert at Lexikin,** an innovative new online platform which creates a digital record of all your assets and wishes acting as a digital executor, and he says that before we start thinking about what happens to them, we need to understand who owns them:
“The law around ownership and therefore the ability to bequeath digital assets is grey at the moment. It’s simply a case of the digital world moving at a faster pace than the law.
“The truth is that, many of the things we would think of as ‘digital assets’ are in fact ‘digital licenses’. This means that the items purchased through a particular site are not actually owned by you. You have merely purchased a license to use the media. Typically, these sorts of arrangements allow you to use the content or services but they are not transferable i.e. you can’t pass them on when you die. For example, your iTunes account; when you purchase music from iTunes you are simply buying a license to listen to that music – you don’t actually own it. It means that this particular digital asset will not make up part of your estate and you will not be able to bequeath it. However, the law is changing, and will eventually catch-up with the issue of digital assets – so at some point you may be able to bequeath it, so it’s worth listing now to safeguard it for the future.”
Hickman recommends that you keep a Digital Inventory of your assets, “The fact there are a number of tech start-ups entering the market looking to address these issues shows that a demand has already been created. Lexikin, being one such company, has developed a platform that allows its customers to store all their important digital assets and memories securely, so that they can leave them to whomever they wish should something happen.”
Technology is changing and digital assets will become an ever more important part of an individual’s net worth in years to come. It therefore follows that without keeping a track on these they could potentially be lost in the cloud forever.
Any platform you consider using should have the ability to incorporate both digital and old world assets – effectively producing a living Will. A Living Will means that you can update your assets whenever you like and ensure that your asset register and Will are always current.
Hickman says, “It pays to be prepared, start considering your digital assets now. Have a think about what you want to happen to them after you are gone. This means not only your bank account and pension but also your social media accounts, digital photos and anything else you own and store online. When you write your Will, or create a Living Will, you can request that your executor manages your wishes, however diverse and varied they may be, so that the whole of your estate is covered and not just the traditional parts.”