Aside from your filing cabinet, where do you keep most of your important information? Probably on your computer and various online accounts. And what will happen to that information when you die? Your survivors could spend months seeking permission from online service providers to obtain access and authority to manage and close down these accounts. If your survivors don’t have access to your email accounts, they may not even know that some financial accounts exist if you have signed up for paperless statements, i.e. monthly statements delivered by email.
The fact is, digital media has evolved beyond being just a tool. For many of us, digital media has become a necessity that impacts our daily finances, recordkeeping, communications and social lives. The problem, from an estate planning perspective, is that these resources have gates that we must get through to access this important information.
Because more and more information is migrating from paper to computers, there is an increasing need to plan ahead for the proper handling of our digital assets. The keys to unlock these assets include account usernames and passwords, and a roadmap for locating where the digital assets are located. Without this information, your executor or trustee will probably not have timely access to your email accounts, online financial accounts, and online retailers and service providers that hold credit card information. Additionally, assets such as digital photos, Facebook pages, and other information stored online or on your computer may never be retrieved.
How do you plan ahead as to who should have access and who may review your important documents and online accounts? Much like you do today with regular assets: identify what you own; select a capable person to manage these assets if you become incapacitated or die, and ideally, provide instructions on what to look for and where to look.
Identifying your digital assets. Start with a list of your hardware, including computers, backup hard drives, and any thumb drives or compact disks used to store important information, which should be labeled. If possible, provide a brief overview of the contents of these items, including if you use a financial management program such as Quicken or keep the books of a family business on a personal computer.
You will want to list your online accounts, such as bank and brokerage accounts, and personal accounts including email addresses and social networking pages. For all of these online accounts, you should keep a running list of the username, password and other information needed to log on. While security experts warn against writing any of this information down, the reality is that your survivors will need this information upon your incapacity or death. You will need to not only write it down, but keep this information in a safe but accessible place, in other words not in a file on your computer if your computer requires a password when logging in.
Selecting a digital assets agent. Next, identify who is the right person to access and review all of your important online information. If you have created a clear roadmap of your digital assets and where they can be found, the digital assets agent need not be highly computer savvy, and could likely be your agent under the power of attorney, your executor or your trustee. If you choose someone outside of these roles, you will need to provide authority for them to act during your incapacity and after your death. Thus, your agent under your power of attorney, executor or trustee should be empowered to bring in the digital assets agent and hire additional professional assistance if required.
Completing a set of instructions. A brief set of instructions can go a long way toward making this entire plan work. If possible, provide any additional information that will pull everything together, again with an eye toward what exists and where it can be found. Additionally, you may want to provide direction for your digital assets agent to notify certain members of your online community about your death, for instance email acquaintances and possibly others that you communicate with regularly via email or social networks.
Organization is as important today as it has always been, but the tools required today can be quite different than even ten years ago. Recognize that the types of information your survivors will need after your death has not changed, but locating and accessing the information is a whole new ballgame, thus the need for planning ahead for your digital assets.