Find Out How We Can Help

Can you add digital assets to your estate plan?

On Behalf of | Jun 26, 2023 | Estate Planning

Digital assets are becoming more and more common. Many people don’t even read physical books anymore, for example, choosing to simply download books that they can read on a screen. The sale of physical media for musical artists has been in constant freefall, with the exception of collector’s items like records. People used to have vast CD collections, but they now just download albums to a hard drive or listen on a streaming service.

In essence, the Digital Age has changed how people acquire goods. Part of creating an estate plan is putting the assets you’ve acquired into that plan and distributing them to your heirs. But can you do so with these digital assets? How are they different than physical and financial assets that may have been the sole concern of previous generations?

You may or may not be able to transfer them

In some cases, you certainly can pass digital assets on. This is likely to become very common over the next few decades with things like photo collections. People aren’t printing out photos the way they used to, but they can still take pictures and store them on digital devices. These can be passed on to the next generation, and these are very sentimental items.

But when it comes to consumer goods, such as a collection of video games, books, music or movies, things get a bit more complicated. For one thing, many people “buy” these products from online services. But these services aren’t actually selling the product. If consumers read the fine print, they will find out that the price they’re paying is just for a license. The company itself still owns the movie, but the consumer is given a license that allows them to watch the movie whenever they want. In essence, this feels the same as owning it.

But it isn’t the same because ownership is never transferred and cannot be passed to the next generation. When that person passes away, these accounts are simply closed and access to their media is lost. This is true even if they have spent thousands of dollars building up that collection, believing they owned the products.

As digital assets become even more common, more complications related to passing them along are sure to arise. Those who are doing their estate planning need to know exactly what steps to take to safeguard all that they can for the benefit of their loved ones.