So you’ve got an estate plan, will and durable power of attorney set up. Good job! Lots of people don’t.
In fact, most experts estimate that 50-60 percent of adults in the United States don’t have a will, so you’re ahead of the game.
But you’re not done. You’ve got a plan for your physical assets but something is still missing…
You need a plan for your digital estate too.
Why You Need a Digital Estate Plan
Think about how much of your life is online:
- Bank and investments accounts
- Social media
- Bookkeeping software (business owners, accountants or bookkeepers)
And probably more than that. According to some estimates, the average person has 70-80 passwords (so don’t feel bad if you forget some of them).
Now…think about what would happen if you died suddenly. Your spouse, family or legal representative wouldn’t have access to all of those accounts.
That would be unfortunate for your pictures. But what if your executor needs to access your bank account and financial records? Or you want your online subscriptions and memberships stopped after your death?
These are just some of the reasons you need to have a plan for your digital estate BEFORE you (or your heirs) need it.
There are five things you need to do to create your digital estate plan.
First: make an inventory of your digital assets
Be thorough. A good rule of thumb is to include anything you have a password for and/or make regular payments on.
Second: make a list of passwords (and keep it updated)
For most people this will take the most time. You’ll probably use the “Forgot password” option a lot. Don’t worry…you won’t be the only one.
Third: decide what you want done with each account
This depends on what’s in each account:
- Bank and financial accounts and apps
It will probably be easier for your executor or guardian if they can log into these accounts.
- Social media accounts
Your family and friends may want to be able download pictures from your account. Otherwise, designate someone to shut down these accounts after an interval of time…and maybe send out an announcement of your memorial service.
- Email accounts
Emails can have important information plus the contacts on your email list may want to be informed if something happens to you.
- Financial software (i.e. Quickbooks)
Your accountant and/or attorney should have access to this so they can file appropriate tax returns.
- Subscriptions and automatic payments
You will probably want to cancel these if you die or become incapacitated
Four: Choose someone to be in charge of your digital estate
Pick someone you trust (or more than one person) to take care of the tasks above. Give them explicit instructions (allow access, cancel, etc.).
This shouldn’t be your executor or guardian. They’ll already have plenty to do.
Five: Make it Legal and Official
The best way to handle this is to make a note in your will or attach a codicil to your will (your attorney can handle this).
There are two reasons to do this:
- Some states don’t recognize a digital estate plan as a legal document
- Your will is public information after you die…obviously you don’t want the whole world to know your passwords
To keep your digital estate plan safe, give a copy of it to your attorney and/or store a hard copy in a safe place. Update it regularly.
Your digital estate plan, like your estate plan and will, will make things easier for your family and loved ones if something happens to you.
Would you like to talk about your digital estate plan or any other necessary legal document like your estate plan, power of attorney or last will and testament?