How to organise your digital estate

Setting out what happens to your money, property and possessions when you die is an important task. But in today’s world, you also need to consider your digital assets when drawing up your will, and these can be wide-ranging. They can include everything from online-only trading, pension and bank accounts, to air miles and cryptocurrencies.

According to Philip Munro, partner in the private client and tax team at law firm Withersworldwide, digital assets consist of anything stored online or that exists electronically and holds value. So your digital footprint could also include intellectual property or computer files, for example, that you store in ‘the cloud’ and form a significant and valuable part of your estate. 

“Previously, people used physical filing cabinets, making account details relatively easy to find post-death, but these days much of this is online-only as we’ve moved towards a digital society,” he explains. “This can make it difficult to administer someone’s estate as executors may not have a starting point when it comes to what assets the estate comprises.”

Your online assets may come with several layers of log-in security, or your heirs may simply be unaware of them as there is not any physical evidence that they exist. A solicitor can advise on how best to include digital assets in your will when you write or update this to ensure that they are passed on in accordance with your wishes. And there are also some steps you can take to set up your digital estate that should make it easier for your heirs to piece this together when you’re gone.

Drawing up your digital asset inventory

As a starting point, create a personal balance sheet that includes the basic details of your digital assets, such as names and web addresses for each account. You can find examples of the most common types of digital assets in the free Digital Wishes pack on the SunLife website at https://www.sunlife.co.uk/over-50-life-insurance/digital-legacy-guide/. Also consider whether you’ve anything stored on your computer or in iCloud storage such as valuable photographic or other creative work. These may hold sentimental value too. Check the terms and conditions of the accounts and services that you use, as some may allow you to pass licences on to particular beneficiaries.

Rod Smith, partner at Royds Withy Kin, and co-chair of The Law Society Wills and Equity committee, says: “Consider any digital assets, interests and records with value, whether financial or sentimental. But don’t forget there could also be issues of privacy and/or security. Most importantly, you need an inventory of the digital assets, so hardware, how to access key information and the online accounts themselves, ideally by category. There should also be direction as to how each is to be managed.”

When you open or close online accounts, you can update your digital wishes, so this information may be regularly monitored. You could store your digital wishes online or store them securely with your solicitor alongside your will. For example, legacy planning platform Once I’ve Gone charges £49 a year for a secure online service that enables you to organise and store your final wishes, alongside financial and legal documents and anything else you want to leave, such as personal mementos. You can update this as and when needed, and appoint three or more trusted contacts who can access this information when you’ve passed away. The service offers discounts for charities and it’s free to those diagnosed with a terminal illness.

Shaun Cook, co-founder and chief technology officer at Once I’ve Gone, says: “All data stored in our accounts is protected by industry-leading encryption and cannot be accessed by any third-parties. We have made significant investments in security, supporting log-ins without the need for a standard password, instead sending users a unique one-time password every time they log in to their account for maximum security.”

Other providers that offer specific packages to store your digital assets include end-of-life and estate planning expert Kinherit, with services including a secure online vault for documents. This may store important information for your executors such as the location of your online savings and investment accounts and copies of share certificates.

However, when drawing up a list of your balances, accounts and wishes, you should avoid including a list of passwords, which would enable others to easily log into your accounts in your absence. Andrew Kidd, social mobility ambassador for the Law Society, says: “Account terms and conditions typically prohibit you writing down username or password information but, then again, if you don’t do anything to pass this information on access can be difficult.”

There could be criminal consequences, for example, if someone accesses online storage without authority from the service provider, stresses Smith. “So make sure you’re not unwittingly enabling someone to commit an offence under the Computer Misuse Act,” he adds.

Safeguarding your digital asset passwords

Storing passwords within your will also isn’t a wise idea as wills are public documents once probate is granted. Instead, you can create a separate document known as a ‘letter of wishes’ that can be stored alongside your will. You may choose to include details of any digital assets in this and doing so shouldn’t incur an extra cost when you make your will.

Munro says: “Your digital inventory within a letter of wishes or similar document may include where usernames and passwords can be found, such as a digital vault or third-party password protector.”

You may already have a password protector in place, for example if you hold cryptocurrencies. This can be spread across a number of digital platforms which are accessible through different passwords, account names and private keys.

Max Rothery, from finance community Finimize, says: “It’s common for crypto investors in our community to use a password manager, such as 1password or LastPass, to store these in one place. However, as with anything stored online, there are increasing concerns around cybersecurity.”

As digital assets become more sizable, users often move to a hardware wallet such as as Ledger Nano to secure their private keys. “Keeping passwords on a physical device, known as ‘cold storage’, is more secure from online hackers,” adds Rothery, who recommends Pamela Morgan’s ‘Letter to loved ones’ as a template to write instructions and grant access to digital assets such as cryptocurrency.

Along with your traditional executors, you can appoint a digital executor in your will, although this isn’t a legally recognised position. This can simply be someone who is relatively tech savvy and responsible for dealing with your online accounts in accordance with your wishes. Smith says: “In the body of your will you can state that you have appointed a digital manager, and expect the executors to work with them so that your digital assets are administered in accordance with your wishes.”

When you give different people access to a variety of assets you might want to prepare separate inventories and leave each person the appropriate one with access information.

Kevin McMullan, director at Saga Insurance, says: “Ultimately, you need to provide enough information to get access with the right documents around probate and wills. So you could divide up the documents, leaving basic details with family, and passwords and access with a solicitor that can eventually be used by your digital executor.”