Estate planning in a digital age

| Jun 18, 2017 | Estate Planning

With instances of hacking garnering banner headlines, internet security has become a prominent issue. Complex passwords, impenetrable firewalls and other weapons are growing in their sophistication to combat the growing and sinister efforts to access confidential information.

Hard copy has become passé. Paper trails are shorter, if not nonexistent. Banks, utility companies and others entice their customers to go paperless by providing the option of electronic statements and auto payments.

However, potential problems exist with this more convenient, cost reducing and environmentally friendly approach combined with the need for account security. Account holders who unexpectedly pass away or become incapacitated could leave their loved ones without much-needed access to important data.

Lacking physical evidence of bills or statements, family members could find themselves unable to manage a loved one’s bills and finances. They would have no knowledge of money owed and due dates without email or account access.

Digital asset planning can both preserve and protect important information. Plans should include the following:

  • Create a clear and specific statement of intent. You need to include accounts not just in the present, but also in the past and future. Simply put, provide details on who gets access to what.
  • Document a complete inventory of your accounts. Information should include login IDs and passwords that are maintained in a secure location.
  • Select an executor or representative that you can trust. Take into consideration the accessibility of the private and confidential information embedded in the digital assets.

An estate plan, digital or otherwise, should make life easier for your loved ones already going through difficult personal times. Proactively providing critical information and specific provisions can help them avoid sorting through reams of paperwork to secure assets or pay bills.