Don't forget online passwords when crafting an estate plan

This article looks at the problems that can arise when one doesn't create a digital estate plan.

Nowadays, one's online life can have just as much importance as one's "real" life. People communicate, shop, bank, do business, and even date online. When a person passes away, however, their online accounts can present a problem for surviving loved ones, especially if no instructions have been left behind about how to access those accounts. That's why digital estate planning is taking on more importance than ever before. Planning what will happen to one's digital assets will help family and loved ones avoid problems and disputes that could otherwise arise.

Denied access

One problem with not leaving behind directives to deal with online accounts is that without those directives it can become extremely difficult to work out who will get access to those accounts. Access to most online accounts is governed by the terms and conditions written by the companies that provide those accounts along with federal privacy laws. Those companies are often very resistant to providing access to any user's account even after that user has died.

That's why an estate plan should include an updated list of passwords for online accounts. Directions can be left behind authorizing a family member to access the list and to take control of one's online accounts. This list will also help family members keep track of most digital assets, which may otherwise get lost or forgotten about.

Why digital assets matter

Like tangible assets, digital assets can have either monetary or sentimental value. PayPal and Amazon accounts, for example, may be worth quite a bit of money. Furthermore, as MarketWatch points out, such accounts are also often linked to bank accounts and if left idle they become easy prey for hackers. Ensuring a trusted individual has control over these accounts can act as a security measure against possible theft and fraud.

As the Chicago Tribune points out, even if an online account has no monetary value, it likely has sentimental value to loved ones. Facebook, Twitter, Instagram, and other social media profiles are now where many people store their photos and videos. Depending on each account's privacy settings, it can prove extremely difficult for surviving loved ones to access those pictures and videos if they have not been granted access to the account itself. For some, it can feel as though they are being barred from keeping a family photo album of a loved one they have just lost.

Creating an estate plan

The evolving issues surrounding digital assets are a reminder of why it is so important to have an estate plan in place as soon as possible. An estate plan provides protection and assurance to one's loved ones and can save them from dealing with many potential conflicts and disputes. An estate planning attorney can help clients draft an estate plan that is effective at protecting their assets and provides a comfortable and secure future for their family.