Preserving your digital legacy: How to include online accounts in your estate plan

Part of our Wealth Management practice deals extensively with helping clients plan for the distribution of assets after their death. Most people think of this in terms of tangible assets: real estate, financial accounts, jewelry, artwork, antiques, or other family heirlooms or items of value. However, a growing area of concern is what happens to your digital assets in the event of your death?

Recently, I sat down with Joe Oleksak, the leader of Plante Moran’s cybersecurity consulting team to talk about this emerging issue.

What are digital assets?

The things that come to mind for most people are online investment accounts, bank accounts, cryptocurrency accounts, and other online financial sites and information that have a monetary value. In most cases, the assets we’re talking about are the username and passwords that would allow someone access to these accounts.

Some of the things that people might not think about, however, are online file storage, digital photo albums, music playlists, blogs, email accounts, or social media sites. These types of digital assets may contain original creative work or property that’s irreplaceable and has significant sentimental value.

How to protect digital assets — and transfer them when the time comes

Regardless of your age, experience, or financial circumstances, protecting your privacy online and keeping your electronic information out of the wrong hands is critical. However, when it comes to estate planning, the more information your family, heirs, trustee, or personal representative has, the easier it is to resolve your estate if you die or become incapacitated. Balancing these two goals can be challenging, but Raj has some general suggestions to help you give your family a map without opening yourself up to too much risk.

1. Share carefully.

Be careful of who you share your login credentials with. Unfortunately, identity theft originating from family members is fairly common. There’s also the risk of a family member misplacing your credentials, which could result in them getting into the wrong hands.

2. Designate a “digital fiduciary.”

Add a digital fiduciary to your will or trust, and provide them with specific instructions on how you’d like your digital assets handled upon your death. Your “digital fiduciary” can be the professional trustee you name as successor trustee of your trust, or personal representative of your estate, or someone else of your choosing.

3. Take inventory.

Make an inventory of all your digital assets, and provide a copy to your fiduciary, attorney, or professional trustee. Update the information as it changes, and review it annually. Your inventory should include account numbers and IDs but not passwords. Include:

• Online memberships or payment service sites
• Investment/banking sites
• Social media sites
• Blogging sites or other places you may have written content archived
• Photo storage and sharing sites

4. Lock up your passwords.

Record passwords and answers to your account security questions and lock them in a safe right away (don’t leave them out where an unauthorized person could see them). Your trustees can use them to gain access to your accounts if you can’t do so. This way, you don’t have to risk sharing your passwords with a trustee or family member. They’ll also be safer here than in a password storage software application, which might be prone to fraud, bugs, and hacking.

5. Use strong passwords for websites and devices.

Many of us log onto multiple sites daily and use the browser’s auto-save function for login credentials. While we advise against this practice, it’s better than writing the passwords on a piece of paper that someone could find. If you use this method, make sure you have strong passwords for not just the websites you frequent, but your devices, too, namely laptops and cell phones.

What can I do if I think a recently deceased loved one had undisclosed assets?

If you’re charged with acting as a trustee on behalf of someone who didn’t provide a full inventory of their digital assets, here are a few steps to take:

• Watch the mail for statements from unknown financial institutions or accounts — they may come monthly or quarterly depending on the type of account and can give you insight on where to look for missing assets.
• If you have access to the deceased’s computer, you can look for favorite sites or browsing history which can tell you if they were using any social media sites, blogging sites, or even some financial sites.
• If you’re a trustee, you should also be able to legally request a log from the deceased’s internet provider to see if there are additional IP addresses that may lead to assets.

Remember, though, the process to locate an asset, verify that the original holder is deceased, and grant a legally designated heir access can be very complicated and frustrating. The best solution is to plan in advance and share information securely with your family or trustee so that he or she can act on your behalf when it becomes necessary.