Darren Burns, Head of Advice at Graviton
Significant parts of our modern lives exist in the online space. There’s your carefully curated Google Photos account, your Facebook Marketplace side hustle, or even your quiet cryptocurrency account. And while they’re a big part of our lives, these digital assets are often overlooked – or simply not known about – when it comes to our wills and estate planning.
In the past, a trusted adviser may have had a spare key to the family safe. Similarly, today’s advisers need to know how to access their clients’ online investment accounts.
“There are many people whose spouses, children and grandchildren have no idea what their digital footprint even looks like,” says Darren Burns, Head of Advice at Graviton. “They could have bank accounts or investment accounts that they don’t talk about and prefer to keep to themselves. It gets complicated when it comes to winding up an estate, and those digital assets have not been included in the will – and even more complicated if nobody knows about them.”
What’s the best way to handle those when advisers put financial plans together, and clients write up their wills? Burns says the appropriate approach for financial advisers now is the same as it was in the pre-digital age.
“Make sure your client has a plan in place, that it’s written down, and ensure you as the financial adviser know about it,” says Burns. “A generation ago, people would have included their physical assets in their estate planning. That would have included everything from financial assets, like investments and bank accounts, to things that have no financial value but great sentimental value, like family recipes or photographs that have been handed down through the generations. Back then, a client and their financial adviser would have had a plan, which would have included a will, with clear instructions as to what should happen with those assets.”
Today – when bank accounts are accessed online, and old family photos have been replaced by digital albums – the same principle applies.
“An updated will is imperative,” says Burns. “But today, advisers and clients must make provision for digital assets as well as hard assets. Facebook accounts or Google Photos might not have much monetary value, but they do have value to children and grandchildren. You just need to make sure someone can access them; otherwise, they’re going to be lost forever.”
For advisers, the emergence of digital assets has made financial and estate planning more complicated. It has also made trust and clear communication with clients even more important. “Sit down with your client, and have an open conversation with them,” says Burns. “As an adviser, you’ve got to understand exactly how big their digital footprint is, and what they want to do with those accounts and assets when they pass away.”
For clients, this new digital dynamic deepens the need for a trusted adviser, who is backed by a reputable organisation. “The complexity of winding up an estate is often underestimated,” says Burns. “And in the digital space especially, there are very complex ‘what-ifs’ that the average person doesn’t consider until they speak to a qualified financial adviser. And even then, it’s a bit like visiting your doctor: if you don’t give the adviser the full picture, they can’t give you the advice and guidance you need.”
The risk, Burns warns, comes down to what some financial advisers call the “illusion of the last breath”. “What that means is that you always think you’ll have a last, dying breath, in which you’ll tell a family member what your Google password is, or how to access your hidden crypto millions. But the reality is, you never know when your last breath will be,” he says.
“Have a plan,” Burns concludes. “Have a plan, and – whether it’s your financial adviser, your spouse or your best friend – make sure someone knows about it.”
ENDS
