Estate Planning in the Digital Age



Anthony Ma

Financial Advisor & Associate Portfolio Manager


The arrival of COVID-19 vaccines is providing a sense of hope for the eventual end to the global pandemic. While we look to the new year with optimism, we would be foolish to miss the opportunity to reflect on what we have learned from a year of Zoom meetings and the proliferation of online apps and services.

According to app store intelligence firm App Annie:

• Mobile app usage grew 40% year-over-year in the second quarter of 2020.

• Consumer spending in apps hit a record high of $27 billion in the second quarter.

• Mobile app downloads reached a high of nearly $35 billion.1

Whether we return to the old normal or create a new one, we have all been cata­pulted into the digital age and it is here to stay.

Digital assets – What are they?

Traditionally, when you think about how to distribute your estate when you pass away, you think about your financial as­sets (bank savings and investments) and physical assets (real estate, vehicles, and other possessions). Generally, there is a monetary value that you can divide as a percentage or dollar value to family members, friends and charities. What you may not have thought about – yet – is an asset class called digital assets, which includes everything from loyalty points, email accounts, and social media websites to cryptocurrencies and personal photos and videos. Just like financial and physical assets, they can have both a fi­nancial and sentimental value.

Why do they matter?

Have you thought about how you would ensure a collection of photos and videos on your computer are made known to your family members when you pass away? What about the thousands of loy­alty points and travel rewards that you have saved up? Or the online banking and investment applications that you do not have a paper trail of?

As you can imagine, things can get com­plex very quickly, especially since this is still a relatively new space and laws and regulations have yet to keep up. Without proper planning, your family may find themselves in an overwhelming situation when trying to settle the digital assets of your estate.

What can I do about them?

Here are three steps to help you start the process of integrating your digital assets into your estate plan:

1. Create a digital asset inventory. The first step is to create an inventory of your digital assets. Ask yourself the following questions:

• What hardware do I have? (Computers, laptops, tablets, smart phones, external hard drives, memory cards)

• What software and apps do I use? (Online banking, email accounts, travel rewards, credit cards, cloud-based storage, loyalty points, cryptocurrency)

• Which digital files are important to me? Especially if you are a creative producer or artist... (Photos, videos)

• What social media presence do I have? (Facebook, Twitter, Linkedin)

Your digital assets will change at a much faster pace than your financial and physical assets. Therefore, you will need to have easy access to your inventory and be able to make updates on a regular basis. A useful list to include with your inventory is a catalogue of your login credentials.

2. Identify appropriate help. Once you have identified all your digital assets, it’s important to determine an appropriate executor. Given the accelerated growth of a person’s digital footprint, executors will have a large responsibility in the future to navigate potentially hundreds of different digital assets.

3. Provide access and instructions. To help your executor, you will want to ensure you have left instructions on how to access your digital asset inventory. You should also include a detailed set of instructions on how you would like your digital assets to be handled. For example, you may want to leave all your Aeroplan points to a certain family member or your Starbucks rewards to your coffee buddy at work. You may want to keep your Facebook account active so that your friends can continue to see your photos, or you can choose to deactivate your account. Each digital asset could have a specific distribution plan.

There are an increasing number of businesses and platforms that offer to help people organize their digi­tal and physical assets. Consider contacting your lawyer or financial advisor to see if they have any recommendations.

Digital assets add a new layer of complexity to your estate plan in this digital age. Planning for your eventual demise is not an enjoy­able task and might be low on your priority list. However, if the global pandemic has taught us one lesson, it is that plans can change in a heartbeat and uncertainty is certain. It pays to be prepared and plan for this uncertainty. ■

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