With so much of our financial and personal information now online, estate plans must address the fact that our digital selves will outlast our human selves. Loved ones left with the unpleasant task of navigating and penetrating the digital maze can inherit a complicated puzzle.
Your online banking account, email accounts, Facebook page and even online photo albums can outlive you– leaving family members and estate executors burdened with digital remains that can have important personal and financial value.
Many heirs discover that they have no clear authority to access and manage online accounts of the deceased even if they have the passwords. Confusing and sometimes contradictory online user agreements (and state and federal laws) may restrict Internet users’ ability to transfer their online accounts to loved ones after their death and prevent families from retrieving information stored in the digital realm.
New law provides guidance
Fortunately, there is help! On January 1, 2017, California passed The Revised Fiduciary Access to Digital Assets Act that permits executors and trustees to gain disclosure of a person’s digital assets after the original user’s death under certain conditions. This is very important because, until last year, federal and state laws regarding digital access made it difficult for executors and trustees to get such disclosure without a court order.
Being named an executor or trustee isn’t necessarily enough to gain access to a decedent’s digital assets. Instead, the executor or trustee must provide evidence of the decedent’s consent to disclosure, and, if necessary, get a court order that verified that consent.
The new law makes it easier for executors and trustees to show that the decedent had consented to disclosure and to gain access to the deceased’s digital information. It also gave content providers and privacy advocates with what they most wanted: a requirement of prior consent before disclosure.
Protecting your digital afterlife
Given the complexity our digital lives present to our future heirs, it’s essential to include online accounts in one’s estate. Ignoring this important area of our lives can prevent loved ones from recovering family photos or videos or settling your final bills.
Here is how to update your estate plan to protect your digital afterlife and help your executors and trustees access the information needed to settle your affairs.
1. Take inventory of all your online accounts, including e-mail, social media, blogging, photo-sharing, frequent-flier, shopping/retail, credit card, banking, and bill payment accounts, such as those established directly with utilities. For each account, list login and password information as well as answers to secret/challenge questions.
The security of such a list is critical. Consider using a password management system such as LastPass (www.lastpass.com) or 1Password (www.1password.com). These services encrypt your login and password information and keep it securely stored in the cloud. You will have a master password to unlock the data, so it’s easy to retrieve and update password information. Do not put any password information in your will, as it becomes a public document.
2. When you have completed your inventory, write down where you have stored the information and the master password needed to access it. Put that information in your safe deposit box or in your attorney’s vault.
3. Consider signing a statement, which can be drafted by an estate-planning professional, authorizing the companies that hold your online information to disclose that information to your executor or another representative.
4. Update your will or trust granting permission to your executor or trustee to access digital assets.
Updating your existing estate plan to reflect the new law is a smart move and will ensure a less complicated transfer of your assets for those left behind.