With the rise of social media presence and a shift towards the use of digital platforms, it is important to consider your digital assets when estate planning.
Examples of digital assets include digital money such as cryptocurrency; social media accounts; photographs, images, files or data stored on your mobile phone, computer or cloud service; music bought on your iTunes account; online shopping accounts; email accounts used to access various online banking platforms and utility accounts; money held in mobile phone accounts such as M-PESA and so on.
Although the presence of digital assets is almost guaranteed in our lives, there is a gap in the succession laws of Kenya as there is no definition of a "digital asset". Where a deceased has not specified in his will who would inherit his digital assets, they would generally form part of the deceased's residuary estate and vest in the residuary beneficiary. On intestacy, the digital assets would generally vest in the immediate next of kin determined by the Law of Succession Act. It is important to note that digital assets can be difficult to find if one doesn't know where to look. For example, if your beneficiaries are unaware that you own cryptocurrency, they might never find your digital wallet and this would be a valuable asset that they would fail to benefit from. Some digital assets such as photographs, videos and emails have no monetary value but could have sentimental value to your loved ones. Just in case they are aware of such digital assets, how would your personal representatives go about retrieving them, particularly when they do not have the required passwords or access codes?
It is therefore advisable to create a plan in respect of your digital assets during your lifetime. Some service providers of online accounts and mobile payment companies have their own service contracts setting out what happens on death. It is important to consider who you wish to appoint to handle your digital assets after your demise and set out directions on how you would wish and want them to be handled and/or distributed. Such directions and wishes in relation to assets are usually set out in a will. However, given the fact that once filed in court a will becomes a public document, it would be advisable to record usernames, passwords and other sensitive information in a separate memorandum which remains as a private document and which can be updated as required. It is, of course, paramount to balance privacy and confidentiality with appropriate disclosure.
Through estate planning, you can protect your privacy as well as make it easier for your executor to manage your estate after death. To get started, make a list of all your current digital assets; it may surprise you that you have a lot more than you thought. Next, engage the services of an estate planning advisor on how to include your digital assets.
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.