Why do we need to protect our digital assets?
Many of us haven’t thought about protecting our digital and financial assets at all. It’s not that we are irresponsible or don’t care about them.
It’s just that we’ve always associated topics such as asset protection, estate planning, digital inheritance, and digital legacy management with rich people (or, in modern terminology, “High Net Worth Individuals”) but not with us.
We are working hard, for sure, and our net worth is definitely not zero, but we are still not among those featured in articles in Forbes, Bloomberg, TechCrunch, Entrepreneur or Wired.
Why then, these days, do even people who are not high net worth individuals need digital legacy management to protect their digital and financial assets? What has changed?
A lot, actually. Let’s have a look.
People have multiple and diverse assets
Even if many people are not ultra rich, they have many and diverse assets – bank accounts, credit cards, and insurances, to start with the basics, but then on top of these, people often have many others:
- Stock trading accounts on online trading platforms or with digital brokers
- RSUs (Restricted Stock Units), ESOPs (Employee Stock Options Plan) or Stock Options (for employees in tech companies)
- Small crypto holdings – Bitcoin, Etherium or others
- Small shares in startup companies (for angel investors)
- Retirement annuities, pension schemes, and provident funds
- Various insurance policies – life insurance, disability cover, home and car insurance, etc.
The list can go on and on, and it’s clear that the picture is very different picture from 50 years ago!
Assets stored in different repositories
Now think about the list of assets that you have, which might be similar to the one that we crafted above. Where are these assets stored? Exactly! Most of them are stored in different repositories!
So not only are your assets complex and diverse, but they are stored in different systems!
Yes, and what about ExPats!
An ever-increasing number of people globally are becoming expats. According to official data from the UN, the number of people who have moved to live and work in other countries has increased by 50% in only the last 10 years!
And what do you do when you move to another country? You open a local bank account, establish local retirement planning, take out local insurance policies, and sometimes buy local real estate.
So we have seen that many people have complex and diverse assets stored in various systems and repositories, and being an expat further complicates the situation.
This whole situation provides your loved ones with little to no transparency about the assets that you own.
If something were to happen to you, your loved ones wouldn’t know where your assets were and would be unaware of the very existence of many of them.
The many real-life horror stories that we often hear illustrate the magnitude of the problem.
But if you are a data-driven person and don’t trust emotional stories, here are the raw numbers:
- $100B in unclaimed assets in the US
- £77B in the UK
- More than a trillion dollars in abandoned and unclaimed financial and digital assets in the US and EU alone!
It’s arguable whether the horror stories or the raw numbers are the more striking!
The elephant in the room. Really.
It’s inevitable that you ask, “But why do we have this problem?” The answer is easy: because in most countries globally, there is no legal requirement for the companies that store your assets to inform your family members if something happens to you, even if they have their contact details!
You can’t avoid asking, “But why don’t governments force these companies to inform the beneficiaries? Why don’t they make it mandatory? Especially when most of them have the contact details of the beneficiaries anyway?”
You already have a whiff of the answer. Guess where these moneys go, after the obligatory period of being abandoned in the financial institutions. Right – after that period, they go to the state!
So the financial institutions operate freely with your hard-earned money for several years (the period depending on the country or the state in the US), and then the politicians get hold of your money – forever!
Quite sick to think that tomorrow your children will witness these same politicians convincing them to vote for them, in election campaigns funded by their own money – that they should have inherited.
You feel bad now, I know. But don’t worry. The good news is that there is a really easy and very effective solution to protecting your digital and financial assets!
And your loved ones, too 🙂
What is digital legacy management?
Digital legacy management enables you to easily track, manage, and protect your digital and financial assets.
It enables you to set up your digital inheritance plan, stipulating the assets that you want to include in it and the beneficiaries whom you want to inherit them.
The digital inheritance plan is a single pane of glass for all your assets; it doesn’t matter in which repository or system they reside.
The best part of digital legacy management is that it uses digital inheritance services, which use advanced technology to detect a fatal event happening to you and upon detection proactively inform your loved ones about the designated assets.
Your family members should not carry the burden of remembering the details you have shared with them. The digital inheritance service will proactively inform them about the designated assets.
Digital legacy management services enable you to keep your asset catalog up to date with a few simple clicks. No need for expensive attorneys, and no need to spend time visiting law firms or dealing with digital estate planning tools.
Using digital legacy management to protect our digital assets
Digital legacy management enables people to easily and safely protect their digital and financial assets and ensures that in the case of a fatal event, the beneficiaries and family members will be proactively informed about the designated assets.
They’ll be aware of the existence of the up-to-date asset catalog, and they’ll know where to identify the assets and how to claim them.
Many digital legacy management services, such as DGLegacy, also offer legal services for the beneficiaries as part of their overall service package. Your loved ones will not only be aware of your assets but will receive legal support in the process of claiming!
Is it really safe?
Yes, it is. Most digital legacy management services know that trust and security are at the core of their business, so they take it really seriously.
From basic things such as 2FA, through end-to-end encryption with custom master passwords, to regular independent security inspections and certifications.
What are the alternatives?
You can’t help but wonder whether you can’t use traditional or digital estate planning services, for example.
Apart from the obvious fact that they are expensive, there is a bigger problem with them.
Imagine that one sunny day you decide to draw up your estate plan – digitally or via a traditional attorney.
You carefully choose the law firm or the digital service, you schedule an appointment, and after several weeks of meetings and information exchange, you get your estate plan. Yahoo!
Now imagine that this sunny day was just three years ago. Can you compare the assets that you have now with the ones three years ago? Quite different, right?
So how exactly will your estate planner protect your loved ones in the case of a fatal event if the estate planner is not aware of the very existence of your assets?
If your family members get hold of your estate plan, they’ll be unpleasantly surprised that some of the assets listed there are obsolete, while others they are sure that you possessed are missing!
The reason is simply that people these days have a very dynamic catalog of assets, and it’s completely unrealistic to expect to go to an estate planning attorney every six months to update your estate plan.
Estate planning services, traditional or digital, were great for protecting your legacy a few decades ago. In today’s dynamic world, you need a solution that enables you to easily and safely protect your complex and diverse assets and provide transparency to your loved ones.
The road ahead
Digital legacy management services are becoming more and more popular. The trend started in the US and Europe but is rapidly spreading around the globe. This is not surprising. Many people globally have complex and diverse assets, and many global hubs attract expats.
Seeing all the advantages of digital legacy management services, we can foresee that within a few more years, they will be the predominant way global citizens will protect their digital and financial assets.