Do You Have a Digital Estate Plan?
It’s almost Tax Time, that time of year when lurking behind plans for Christmas is
the thought that we will soon have to face how organized—or not--our finances are. In addition to reviewing the documents and strategies we will need to be prepared for April 15th, it’s a good time to review the records and legal documents our family will need to manage our finances when we pass away, or even when we need their help because we are “getting older.”
I thought I was doing a fairly good job with my estate planning UNTIL I read this AARP article, “Prepare a Digital Estate Plan for Future Caregivers.”Then I realized there was a huge hole in what needed to be done before I died or become unable to manage my own affairs. Thefamily members who are the executors of my estate will need access to mydigital assets and data!
When my dad died 7 years ago at age 97, he didn’t even own a computer. As co-executor of his estate,anything digital relating to his life and estate was on my computer, and I was already managing it. The Power of Attorney, the Family Trust, his Will and his death certificate were all my brother and I needed to quickly settle his estate and distribute or dispose of his assets.
My situation is very different. A lot of what my co-executorsneed to know and have access to ison my computer. It not only needs passwords but, in some cases, specific legal permission to access it. I went to work to make this very necessary information accessible to them, physically and legally.
A digital estate plan is necessary for caregivers and survivors to manage your digital assets. I’m still in good health. However, at age 79, if I’m realistic, who knows how much longer my good health and brain power will last. I don’t want to leave a big mess for our 5 children, so I need to continue to follow and improve uponand update the advice about a Digital Estate Plan that I’m sharing with you.
There is additional information about the What-and-How-Toof digital estate planning in the five articles listed below, but hopefully my summary contains the basics and will give you the motivation and direction needed to start filling your own digital hole, if you have one.
What are your digital assets? The answer to that question will vary from person to person but start your plan by making a list that you can add to as other things come to mind. It may include most of the following and more, for both you and your spouse:
- Email and social media accounts
- Online banking and credit card accounts: note any accounts that may be linked to your card or bank for automatic billing
- Accounts for managing utilities
- Online subscription services
- Shopping or marketplace accounts (i.e., Amazon, eBay, etc.)
- Photos and videos saved online or in the cloud
- Loyalty program benefits (i.e., frequent flyer miles, credit card perks, etc.)
- Personal information or apps on your cell phone, or tablet
- Contact lists for calls, emails or texts
- Document files with a password, such as a journal or work projects
- Websites or blogs you maintain
- Entertainment, music, films, and e-book purchases stored online
Who do you want to have legal access to your digital assets? Prepare (or revise) your estate planning documents to include digital assets and related information:
- Where and to whom you want your digital assets to go
- All your documents (i.e., wills, powers of attorney and trusts) should authorize someone to be your “agent” and your executor for your digital estate. Include language giving your chosen person(s) authority to “access, control, use, cancel, deactivate, or delete digital accounts and digital assets, and to access, control, use, deactivate or dispose of digital devices.” This ensures they truly have your legal consent to do so.
- Give at least one person access to your accounts and the authority to act on your behalf.
- Tell the people you trust and who will need it where the plan and access information are located.
How will your family or other responsible parties access your accounts?When you’ve made your list and specified where and to whom you want each asset to go, you’ll need to add all the usernames, PINs, passwords, and in some cases answers to common security questions that go with each one. If you were to pass away suddenly or become incapacitated, someone must be able to easily access online bank statements, bills, and other information that requires action.Printing your year-end statement from each of your accounts and saving them in a file will create an easily accessible paper trail.
One in three family executors say a top challenge of taking over for someoneis locating passwords and accessing accounts. Almost 50 percent don't have legal authorization to ask providers (such as banks, credit card companies, email services) to disclose any details or give them access to accounts. Data privacy laws prevent providers from giving caregivers, even family members,access to vital information without proper paperwork. Write out clear instructions that will enable an executor to manage your affairs without court intervention.
How can you safely store digital access information?You need to keep things like usernames and passwords safe, but your caregiver or executor also needs to be able to find and access themwheneverthey are needed. Including them in your Will isn’t an option, because after you die, your Will becomes public information. You want tobe able to update your digital Estate Plan as you create and delete online accounts, without having to update your Will.
Some choices for how to keep this information safe include:
- Store information with a document vault service or one of the excellent password management tools that create, remember and fill in passwords automatically.
- Back up your data frequently. Store important items on external devices kept in another location.
- Keep hard copies of the information in a locked, fireproof cabinet or safe.
How can you ensure your digital estate is handled the way you want it to be?Write a letter of instruction for your future caregivers and executors thatspells out how you want your digital estate handled. Specify to whom assets should be transferred,which accounts you'd prefer to be deleted, or which ones you want saved as part of your personal history or memories you want passed on.
Some social media sites have functions and solutions you can select in advance. For example, Facebook allows users to designate a profile executor who can access your account upon death. G-mail users can designate an inactive account manager who may access the account if it is inactive for a specified period.
Give specific instructions as to who can access your email accounts, including bills, notifications, and credentials for other digital services. The content of your email may also be important for sentimental value, or to help to settle the estate.
Why a digital estate plan is so important: When our families can rely on a written plan that outlines the passwords for our digital assets as well as how those assets should be managed, they won’t have to worry about navigating a more extensive probate court process, and they can act quickly in the event of a sudden illness or death.The best digital estate planscover all our online activities. Make a note in your Will that you have one which, hopefully, you will soon. Writing this has made me realize that I need to update mine!
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